We're talk-in' a-bout mon-ey, mon-ey 🎼 🙋

This week on Vestpod: set-up your workplace pension, explore the new Lifetime ISA and a get acquainted with the realities of freelancing.
What’s the point of having a plan if it’s not ambitious?” Marta-Lane Fox, CBE, British businesswoman, philanthropist, and public servant. Co-founder Lastminute.com 
This week, we have two exciting updates to share with you:
  • Our very own Vestpod founder Emilie Bellet was interviewed by the lovely Paola Garbini of NOI Club. NOI is a thriving community of female achievers that champion each other and organise regular meetups. Go check it out!  Thank you, Paola, for all your support!    You can read the full interview here.
Introducing the workplace pension
Do your visions of retirement involve an endless supply of Bollinger and napping on a beach in the Maldives? You aren’t alone, dear friend. But have you got any idea of what your income will look like once you bid farewell to working life? Exactly. Don’t make the rookie mistake of thinking that your state pension will cover all your whims and wishes; it will just about provide for the very basics.  

No need for alarm just yet, though - there is a good chance your employer offers access to a pension at work scheme, also unimaginatively known as the the workplace pension. Most UK employers are now obliged to put in place a qualifying workplace pension scheme and automatically enrol their qualifying workers.

This scheme is quite handy, as it helps you save for retirement without you doing much. You will be auto-enrolled, contributions will be automatically deducted from your salary, your employer will (usually) make contributions and you may be eligible to get tax relief from the government as well. Handy indeed.

In a nutshell:
  • 3/4 of eligible employees are participating in the workplace pension;
  • 79% of eligible employees have saved into a workplace pension in at least three of the last four years;
  • Almost 6.9 million auto-enrolled workers saved £82 billion in workplace pension schemes in 2015.
The government has set out minimum levels of contribution that must be paid to the workplace pension scheme by you and your employer. If your employer decides to pay the minimum amount, the minimum total contribution, as a percentage of your qualifying earnings is:

For a more detailed example click here.

You should get information about any workplace scheme you are entitled to join within 2 months of starting work. If you are an eligible employee, your employer will automatically enrol you. If you notice that you aren’t enrolled, contact your personnel or the HR department to find out what’s up.
Free money, anyone?
We’ve talked about how neat ISA’s are in our previous newsletters, but here’s a refresher: an ISA - which stands for Individual Savings Account - is a tax-free way of saving and investing money. There are different types of ISA accounts available - cash ISA, stocks and shares ISA, help-to-buy ISA, junior ISA, innovative finance ISA - and they all have slightly different specificities. In short, it’s an easy, tax-free way to save money.

From April 2017, there will be a new ISA kid on the block: the LIFA or “lifetime ISA”. The Lifetime ISA was launched to help savers beef up their savings towards a deposit for a first home or for retirement. The government will pay you a 25% bonus (up to £1,000) for every £4,000 saved per year. If you’re under 40, the Lifetime ISA is definitely worth considering.  Find out why over at Vestpod.
To freelance, or not to freelance?

If you think freelancing is a euphemism for ‘I’m just sleeping in and chilling’, think again. Freelancers are business owners without employees. It is estimated that in the UK alone, there are 1.9 million freelancers (2015), i.e. 6% of all workers in employment. Since 2008, the number of freelancers increased by an astounding 36%.

Sure, the global financial crisis of 2008-9 that saw unemployment increase by almost 50% has something to do with these figures. However, the number of freelancers has continued to steadily rise since. Why, you ask? Freelancing is often a lifestyle choice - think less commute, more time with your family and greater control over what your day looks like. But what does freelancing life really look like, and could you ever become one?

The world of freelancing can be mired in uncertainty, which is why we are starting a freelancing series that will look into the different aspects you should keep in mind if you’re considering, or already are, freelancing.
  • How do I do manage my taxes and what is the self-assessment tax return all about?
  • What are the best saving vehicles (ISAs, pension, etc) for a freelancer?
  • Making a living out of a freelancing career: figure out how to find and keep clients and how much to charge.
  • Determining what your long-term freelancing goals are.
Our very own freelancer, Veronica from Vestpod, kicks off the series this week with a humorous and honest piece - An introduction to freelancing: 7 tips for newbies.

Thanks for reading, and see you next week!

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We are not certified financial advisers! The articles and information made available on Vestpod are provided for information and educational purposes only and do not constitute financial advice. You are advised to consult with an independent financial advisor for advice on your specific circumstances. Read our Disclaimer  here.
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