Invest earlier in the tax year

Did you know that by investing at the beginning of the tax year, you could benefit from more interest on your investments than if you invest at the end of the tax year.

This is pretty simple to explain. Let's imagine that you invest into a fund paying its dividend quarterly, with a yield of 5%. Let's also imagine that you invest into the same fund eight months later:

Date invested Amount invested
Yield (per annum)

Time invested
Value 
07/04/17 £5,000 5% 12 months £5,254.72*
07/12/17 £5,000 5% 4 months £5,062.50*

By simply investing for eight months longer, your portfolio could work better for you in for your retirement. And don't forget, if you reinvest your dividends, and the fund grows in value, your total returns would further increase.

Whether this was something you had never thought about, something that was painfully obvious, or something in between, topping up your pension earlier in the tax year could be a no-brainer.

If you would like to top up your pension, please email Sarah Culver and she will send you the correct forms.

Note: For those of you who aren't sure what they will earn this year, be wary to not go over the annual allowance.

Each year you will receive a pension statement (on the anniversary of when you opened your pension). This is a great time to have a look at how the funds are performing, and whether it is time to change anything.

*this figure is before any platform or service charges. The annual management charge will also be priced into the value of the fund. This figure does not account for any capital gains or losses during the period.

Published on 24/05/2017