The Labour leadership election may be set to dominate the news agenda and dinner party conversations for the next month or so but it may not have as much of an impact on your investments as many fear.

Sir Keir Starmer resigned as Labour leader this morning, paving way for a leadership election and a new prime minister to be appointed before the summer recess.

Newly-appointed Labour MP Andy Burnham is the only candidate to have thrown his name in the ring so far and it is unclear what his policies will be and who else will challenge.

Stock markets don’t like uncertainty but investors have had to get used to plenty of political upheaval in recent years.

Starmer is the fifth prime minister to resign since 2016, starting with when David Cameron stepped down in the aftermath of the Brexit vote.

The most recent resignation before that was Labour leader Tony Blair in 2007.

But exclusive analysis by wealth manager Quilter for MoneyWeek shows that while these resignations make good headlines, they don’t actually have a drastic impact on stock markets, which could be good news for investor portfolios.

What impact do leadership elections have on financial markets?

Quilter analysed economic indicators such as equities, gilts and the value of sterling against the dollar in the three month build up to a prime minister’s resignation and the three months after.

The analysis showed a mixed picture.

Tim Armitage, investment strategist at Quilter Cheviot, said: “Leadership resignations often prompt headlines about market uncertainty, but history suggests markets do not react to resignations themselves, rather they respond to the underlying risks those resignations expose or resolve.

“Across recent UK history, market reactions tend to fall into three broad patterns – where the resignation follows an external shock, reflects a loss of policy credibility, or occurs against an already dominant macro backdrop.”

UK equities were up by 3.8% in the three months before Tony Blair stepped down in May 2007 and fell 7% in the three month aftermath.

But in some cases, such as the resignations of David Cameron in May 2016 and Liz Truss in October 2022, UK equities actually rose in the three month aftermath by 13.6% and 12.3% respectively.

Armitage added: “In the case of David Cameron, his resignation followed the Brexit referendum, which drove a sharp fall in sterling. While this created immediate volatility, it also supported UK equities and bonds due to the international earnings profile of many listed companies.

“In contrast, Liz Truss’ resignation followed a clear crisis of policy credibility linked to unfunded tax cuts. Markets had already reacted sharply, particularly in gilt yields, and stabilised as her departure removed a key source of uncertainty alongside intervention and reassurance from the Bank of England.”

The impact on sterling has also varied, falling by 7.2% against the dollar when Boris Johnson resigned in July 2022, but rising by 9.2% when Truss left Downing Street.

Armitage said: “Boris Johnson’s resignation came during a period dominated by global macro forces, namely rising inflation and the energy shock following Russia’s invasion of Ukraine, meaning there was little discernible shift in market direction attributable to domestic political change.”

The FTSE 100 and FTSE 250 don’t appear to have been impacted since Starmer’s resignation.

Armitage said: “For investors, the key takeaway is that political change tends to matter most when it alters confidence in fiscal and economic policy. Periods of uncertainty can create short-term volatility, but markets often stabilise quickly once a clearer policy direction emerges.

“Looking ahead, any market reaction to Sir Keir Starmer’s resignation will depend less on the event itself and more on whether it reduces or increases uncertainty around fiscal policy, regulation and economic direction. Early signals on policy continuity and key appointments are likely to be more important for investors than the leadership change alone.”

The key lesson appears to be that time in the market, rather than timing the market, remains the main policy that investors should follow.

Andrew Prosser, head of investments at InvestEngine, said: “Political instability – such as a change in prime minister – can create both risks and opportunities for investors but those who want to grow their money over the long term should not be worried. This upheaval may move markets in the short term, but history has shown markets always recover, and often quicker than expected.

“The investors who tend to come out ahead of periods like this are the ones who stay diversified and stay invested. Our advice is that long-term investors should avoid making knee-jerk decisions, ignore the noise and sit on their hands. Time in the market, as ever, matters more than timing the market.”

The Renters’ Rights Act went live in May, ending no-fault evictions and shifting tenancies to rolling contracts.

The reforms also ban landlords from requesting more than one month of rental payment upfront.

The one month advance payment can only be paid once a tenancy agreement is signed.

This means tenants only need to pay a deposit when moving into a property and one month upfront if requested.

Before the changes, landlords could request large amounts in advance.

Requesting larger upfront rent payments was traditionally a way to reduce the risk of rent arrears, particularly when tenants failed to meet affordability criteria.

We reveal alternative ways to test tenant affordability and reduce the risk of rent arrears.

Tenant referencing

A key part of choosing a tenant is referencing.

Landlords can conduct credit checks, get employer references and assess affordability.

You can also talk to a tenant’s previous landlord to check if rent was paid on time and if the property was kept in a good condition.

Some of these checks can be done yourself but there are companies such as Goodlord and HomeLet who can do the work for you.

Nouran Moustafa, practice principal at Roxton Wealth, said: “Landlords need to stop seeing large upfront rent as the only form of security. It was never a perfect test of affordability anyway. Someone can have cash today and still be financially unstable three months later.

"The better approach is proper, evidence-led referencing, income checks, employment status, credit history, previous landlord references and whether the rent is genuinely affordable against the tenant’s wider commitments.”

Rent guarantors

Some analysts predict that landlords will become more reliant on guarantors.

This is where a family member is required to set aside funds in case a tenant fails to pay rent.

Analysis by property insurance technology firm Zero Deposit found the average renter in England is likely to fall short of standard affordability requirements of 2.5 times the annual rent.

With average rents currently standing at £1,438 per month, equivalent to £17,256 per year, tenants would typically need to earn at least £43,140 annually in order to pass affordability checks, Zero Deposit said.

However, average earnings across England currently sit at £41,859, leaving the average renter £1,281 below the required threshold.

Sam Reynolds, chief executive of Zero Deposit, said: “While the Renters’ Rights Act is designed to improve security for tenants, it also significantly changes the way landlords manage financial risk within the private rental sector. With restrictions on upfront rent payments and fewer traditional safeguards available, landlords and agents naturally place greater emphasis on affordability checks and income protection when assessing prospective tenants.

"As a result, we expect guarantors to become an increasingly common requirement for renters who fall outside standard affordability criteria, particularly younger tenants, overseas applicants, self-employed workers, and those moving to high-cost rental areas."

Rent guarantee insurance

Landlords can also protect themselves with rent guarantee insurance.

In return for a premium, this type of insurance pays out the monthly rent amount for a set period if your tenant falls into arrears.

It may also cover the legal fees associated with serving notices and legally evicting tenants.

Michelle Lawson, director of Lawson Financial, said: “Rent guarantee insurance is now a must and is a low cost way of protecting your rental income against most adversities.”

Find a good lettings agent

A lettings agent should have a book of reliable tenants that they have already reference and recommend.

Using a lettings agent can also help keep up with ever-changing rental rules and regulations to ensure you are renting your property out legally.

Lawson added: “A good letting agent will be fully referencing prospective tenants.

“Self-managing landlords will be the ones potentially sleep-walking into disaster as so many are inexperienced and rely on social media to find tenants and for advice- they need to ensure that they use reputable channels.

“There are many industry backed resources that they can call upon but a number will still cut corners which, with the Renters Rights Act and subsequent council imposed fines, could prove costly. to avoid doubt, they should now be employing the services of a good letting agents who knows the new legislation as the buck stops with the landlord regardless.”

Landlords may have only just finished preparing for the new rental reforms introduced in May but there are plenty of other deadlines to be aware of in 2026 and you could be fined up to £40,000 for failing to comply.

The buy-to-let sector has faced numerous shakeups in recent years, with extra stamp duty charges, the end of mortgage interest relief and changes to capital gains allowances.

The most recent overhaul came last month when the Renters’ Rights Act was introduced, ending no-fault evictions and making tenancies more flexible.

Landlords had until the end of May to provide tenants with an information sheet of changes.

That is just the beginning though and there are still other changes that landlords need to prepare for and failure could result in hefty fines.

Jack Malnick, managing director of property information website Landlord Resource, said: “While there isn’t another major deadline associated with the new Renters’ Rights Act that you need to consider this year, there are a lot of ongoing aims you should be taking into account each month to meet future regulations and avoid additional fines.”

Here are some of the other major rental dates and deadlines for landlords to be aware of.

23 June 2026: The Housing Health and Safety Rating System (HHSRS) changes

Updated health and safety rules mean landlords must ensure their properties are maintained to a good standard for tenants or face penalties of up to £40,000 under the new Housing, Health and Safety Rating System (HHSRS) coming into force on 23 June.

Local authorities use the HHSRS to look into potential health and safety risks in homes in England and Wales. Changes introduced under the Renters’ Rights Act are intended to make the rules easier to understand and enforce.

The current more complicated A-J rating system is being replaced, under the changes. From 23 June, any hazard discovered in a landlord’s property during a local authority inspection will be categorised as high, medium or low.

High risk hazards (known as Category One) will continue to trigger councils' duty to take action against the landlord. The council will still be able to use its discretion when it comes to dealing with medium or low risk issues (known as Category 2).

Under the updated HHSRS, the ‘risk of harm’ rating has also changed, from the existing ‘one to four’ levels to new ‘extreme, severe, serious, and moderate’ categories. Again, the bandings haven’t changed, just the descriptions.

The advice from the National Residential Landlords’ Association (NRLA) is that if landlords are complying with all current health and safety guidance under the HHSRS they don’t need to do anything differently.

“However it is vital that you continue to carry out regular inspections of your properties to make sure they are hazard free and safe for your tenants to live in,” the NRLA said.

The revised HHSRS will affect homes in England only. Wales has different regulations and will need to adopt the guidance separately, so will be using the existing HHSRS until further notice.

31 July 2026: Final court date for section 21 notices

Any section 21 notice or section eight eviction notices filed before the Renters’ Rights Act came in must hit court by this date or they will lapse.

Late 2026: Regional rollout of Private Rented Sector database

The government’s Private Rented Sector (PRS) database is due to launch later this year in the next stage of the rental reforms. It will be gradually rolled out in different regions.

Landlords will be required to register themselves, their properties, and their compliance status on an area-by-area basis.

2027: PRS database becomes mandatory

No precise date has been given but it will be mandatory for landlords to be on the PRS database at some point in 2027.

This is supposed to make it easier for tenants to identify who their landlord is.

End of 2028: New Landlord Ombudsman

By the end of 2028, it will be mandatory for landlords to be members of a new Landlord Ombudsman and to be on the PRS database before they can even list a property for rent.

Failure to register to the new PRS Database and ombudsman could lead to an up to £7,000 civil fine, or up to £40,000 repeat fine.

1 October 2030: EPC changes

Currently, landlords can only rent out a property if it has a minimum Energy Performance Certificate (EPC) rating of E.

This will rise to C from 1 October 2030, meaning landlords have four years to start looking into energy efficient measures.

2035: Decent Homes Standard

The full Decent Homes Standard will be introduced in 2035.

Under the standard, properties must be free from hazards, in a reasonable state of repair and with reasonable services such as a kitchen and bathroom and free from damp or mould.

Landlords can be fined up to £30,000 if their rental properties are found to be below the Decent Homes Standard. The HHSRS remains the statutory framework for hazard assessment under the Housing Act 2004, enforced by local authorities. The DHS complements rather than replaces the HHSRS.

Mental capacity can become increasingly fragile as we age, putting at risk our wishes to pass on an inheritance. But there are ways to protect you and your loved ones’ legacies – and avoid lengthy court battles.

A recent case in the High Court highlights the dangers of waiting too late to get our affairs in order, how useful it can be to write a will when we are fit and healthy, and the merits of a lasting power of attorney.

Michael Gwilliam died in 2022 at the age of 79. His daughters said he had always wished to die intestate – without a will – so they would automatically inherit his estate, worth between £750,000 and £1 million, the BBC reports.

But after his death his daughters found he had in fact made a late will – while experiencing late onset schizophrenia that caused delusions his daughters and others were acting against him.

Inheritance and mental capacity

Gwilliam wrote the will in 2014, the year he was sectioned under the Mental Health Act. The will saw a quarter of his estate left to his daughters with the rest to be split between his sister, former partner and three nephews.

Gwilliam’s four daughters challenged the will's validity on the basis their father lacked the mental capacity to write it. They were eventually successful, but said winning was an "unbelievable relief" after such a long and difficult case.

John Holdsworth, board director at The Association of Lifetime Lawyers and associate and chartered legal executive at law firm Coodes, said: “Having a loved one who has either lost or is losing capacity is deeply challenging.

“The best advice is to get hard conversations out of the way before it’s too late – to make sure families, loved ones and their last wishes are protected. However, we know that things can often change quite quickly.”

If you’re finding yourself in a situation where your loved one has already lost capacity, and they don’t have a lasting power of attorney (LPA) or a will in place, you may need to apply to the Court of Protection for authority to act on their behalf.

It’s a good idea to seek advice from regulated experts, such as accredited members of The Association of Lifetime Lawyers, who specialise in providing tailored legal advice for older people and those in vulnerable circumstances.

Holdsworth said there are at least six things to consider if your loved one is losing capacity where there is an estate to inherit.

Six ways to prepare for a loved one losing mental capacity

1. Have difficult conversations before it’s too late

Nobody likes to think about a parent, loved one or themselves getting older, becoming vulnerable or reaching the end of their life, but planning ahead is key to ensure both wellbeing and security, advises Holdsworth.

An important part of this is discussing what happens should you or your loved one lose capacity to make their own decisions in later life. It’s important to at the very least, have a lasting power of attorney and an up-to-date will in place.

2. Creating a lasting power of attorney

Having a lasting power of attorney in place allows you to appoint someone you trust to make decisions on your behalf if you are no longer able to.

There are two types of LPA, one of which concerns decisions about property and finance, the other, decisions about health and welfare.

“Both types of LPA are extremely powerful legal documents, allowing attorney(s) to make important decisions about the management of property, bank accounts, and bill payments, and choices around care plans, medical treatment, residence and end of life wishes,” said Holdsworth.

For decisions around property and financial affairs, an individual can activate their LPA before they lose capacity, so if your parent or loved one decides they no longer want to manage their own finances, despite being of sound mind still, they can seek the support of their attorney(s) immediately.

For decisions around health and welfare, an LPA is only activated once the individual is deemed to have lost capacity.

3. Having an up-to-date will in place

It can be helpful to think of a will as something that can bring great comfort to your family and to you. It outlines how you want your assets to be distributed after your death and appoint people you trust to put your wishes into action.

“If you or your loved one is starting to lose capacity, choosing an appropriate lawyer with training in mental health and capacity law to help you is something that could be really helpful,” said Holdsworth.

However, whilst making a will is usually recommended to ensure your wishes are carried out, it is not compulsory and there are rules in place to say what should happen if no will is made and you die “intestate”.

4. Have a capacity assessment completed

If someone might have capacity issues, you need to ensure that they are legally able to make a will. To demonstrate this, it is good practice to have a specific capacity assessment completed by a qualified person at the time they make their will so this capacity can be documented should a challenge come after the person’s death.

Capacity for making a will stems from a 19th century case where someone wanting to make a will needs to understand:

• what a will does
• have a general understanding of their assets and where they are (property, bank accounts, investments etc)
• understand who might reasonably expect to inherit from them
• and be free from any delusions that would affect their ability to make rational decisions about where their assets go after their death.

5. Apply for a statutory will

Additionally, if someone wants to make a will, but has lost the capacity to do it, you can apply to the Court of Protection for a statutory will.

The Court will take the views of the person and their family and friends if appropriate into account before a best interest’s decision is made on their behalf by the Court.

This route can also be used if you find out a will has been made in circumstances you think are suspicious and after the person has lost capacity.

6. Apply for deputyship

A deputy is a person appointed and authorised by the Court of Protection to make decisions about either the property and financial affairs or personal welfare of someone who cannot make decisions for themselves as they lack mental capacity.

This could be, for example, because they’ve had a serious brain injury or illness, they have dementia, or they have severe learning disabilities. A deputy can be a professional (like a lawyer) or a family member or friend (lay person).

To act as a deputy for your parent or loved one’s affairs, you must provide the Court of Protection with medical evidence of the loss of capacity, as well as lodging an extensive application and arranging the necessary insurance.

A qualified lawyer can help you to gather the required documents and complete the forms correctly and can also act as a deputy if you prefer not to take on this role yourself.

More than twice as many people say their financial situation is worse now than it was a year ago, research suggests, as the cost of living continues to bite. But wealth was thousands of pounds higher in households with a financial plan – regardless of income level.

Average UK household wealth fell by almost a fifth (17.5%) to £104,329 over the past 12 months, down from £126,482 in the previous period, a survey by wealth manager St James’s Place found.

Causes for the drop included the cost of food and essentials (57%) but also lack of a salary increase (19%) and increased tax bills (8%).

The findings – based on estimated average household wealth, which includes savings, investments and physical possessions but excludes property – are from St. James’s Place’s fifth Financial Health Report, conducted annually among 6,000 individuals across the UK.

Just over a third (34%) said their finances have worsened over the past 12 months compared to only 17% who said it had improved.

Everyday financial confidence is also slipping. Just 37% now describe themselves as financially comfortable, down from 42% last year.

Alexandra Loydon, group advice director at St. James’s Place, said: “Many households are feeling worse off, with living costs and heightened global uncertainty weighing on confidence and, understandably, affecting how people feel about their finances and the future.”

Financial plans linked to wealth

However one factor stood out as having a big impact on household wealth – those who had a financial plan were thousands of pounds better off, across every income level.

On average, households with a financial plan say they have £157,416 in wealth, compared with £70,610 for those without.

Among households earning under £20,000 a year, those with a financial plan are around £24,500 better off on average than those without. At the other end of the scale, the gap rises to nearly £200,000 for those earning over £80,000.

The benefits extend beyond wealth. Seven in 10 people (72%) say having a financial plan makes them feel more confident about their financial position.

Meanwhile half (51%) describe themselves as financially comfortable, compared with just 29% of those without a plan. Three quarters (76%) also say they feel financially resilient and able to cope with unexpected changes, compared to 52% of those without a plan.

Yet fewer than four in 10 people (38%) have a financial plan in place, unchanged since the research began tracking the nation’s financial health in 2022.

Wealth and financial plans by region

When it comes to wealth and having a financial plan in place, London stands apart, with average household wealth of £171,455 and the highest proportion of people with a financial plan in place (46%).

By contrast, planning levels are lower in regions such as Wales (30%), Northern Ireland (33%), and Yorkshire and the Humber (35%) where average household wealth is also significantly lower at £86,847, £100,534, and £73,488 respectively.

Elsewhere, 40% of people in the North West have a financial plan, with average household wealth of £82,968, while in Scotland 37% of people are planning and average wealth stands at £96,918.

Loydon said: “Those who take a more structured approach to managing their money are better placed to build wealth, feel more confident and stay resilient, regardless of their income or circumstances.

“At a time when so much feels outside of our control, it becomes even more important to focus on the things we can influence. Having a clear plan for your money, and taking small, consistent steps to manage it, can make a meaningful difference – helping people feel more in control and better prepared for whatever comes next.”

Simple steps to help build a financial plan

1. Identify your financial goals

Start by being clear about what you want your money to do for you. From short-term goals, such as building an emergency fund or paying for a holiday, to longer-term goals, like buying a home or saving for retirement. Clear priorities can help shape better decisions and make planning more manageable.

2. Understand your current position

Take stock of your income, outgoings, savings, debts and assets. Understanding where your money is going can help identify areas to adjust and create opportunities to save or invest more consistently.

3. Build an emergency cash buffer

Building easy-access emergency savings for the short-term to cover unexpected costs or changes in income can provide greater financial confidence in uncertain times. Investing over the long term is also key when it comes to building financial resilience. Even small, regular contributions can build up over time.

4. Think about investing for the long term

Longer-term goals require a longer-term approach. Investing can help build wealth over time, especially when it is started early and maintained consistently. Ideally when you invest you should be prepared to tie your money up for at least five years.

5. Review your plan regularly

Financial circumstances change. Reviewing your financial plan as your situation evolves can help ensure it remains on track with your goals and priorities.

6. Consider seeking professional advice

Professional advice can help you gain a clear vision and structure for your saving and investing, particularly if your finances are more complex. People who seek advice are often better placed to work through tricky financial situations and build stronger wealth foundations.

Large parts of the Renters’ Rights Act have come into force and while it should improve outcomes for renters, critics argue it’s made the task of being a landlord tougher.

One of the Labour government’s flagship policies, the bill looks to shift what some perceive as the power imbalance between tenants and landlords.

But its introduction comes after years of the buy-to-let market being clobbered, with increases to the second home stamp duty surcharge and tax reliefs on mortgage interest slashed.

The changes contained within the Renters’ Rights Act, which applies primarily to the private rental market, are being phased in from 2026 onwards. A large number of changes came into effect in May 2026.

‘No fault’ evictions have been banned, renters can now ask to live with a pet and landlords cannot reasonably refuse and fixed-term tenancies have been replaced with rolling contracts.

The act will look to extend Awaab’s Law to private rentals too, although this hasn’t come into effect yet. The law, already in place for the social rented sector, means landlords have to investigate and fix serious damp mould and emergency hazards within a fixed timeframe.

While the Renters’ Rights Act will arguably improve lives for tenants, landlords already working in a challenging market need to arm themselves with as much protection as possible.

Here are four key things landlords should consider doing now.

Rent guarantee insurance

With the Renters’ Rights Act abolishing Section 21 (of the 1988 Housing Act) ‘no fault’ evictions, landlords now have to rely on section 8 to take over possession of a property.

Under Section 8, tenants can be evicted on anti-social behaviour grounds or for owing at least three months’ rent.

However, this could lead to extended periods where landlords are left significantly out of pocket and facing legal costs if a tenant disputes a case and it goes to court.

Rent guarantee insurance can protect you in this situation, covering for missed rental payments and sometimes legal costs.

Rent guarantee insurance usually pays out for between six to 12 months. How much you pay will vary depending on the type, size and location of the property, your level of cover, the excess and the insurer’s assessment on how likely it is a tenant will default on payments.

You could also ask a prospective tenant to agree to have a guarantor, who can cover any rent should the tenant be unable to pay.

Chris Norris, chief policy officer at trade body the National Residential Landlords Association (NRLA), said: “For landlords who rely on rental income to cover essential costs, a guarantor or rent guarantee insurance is a sensible option.

“With Section 8 possession routes likely to be slower and costlier, cover that pays out for unpaid rent and the legal costs of regaining possession can be the difference between a manageable setback and a serious financial hit.”

Tighten referencing and affordability checks

With fixed-term assured tenancies ditched through the Renters’ Rights Act and, alongside the banning of Section 21 evictions, it’s incumbent on landlords to do thorough affordability and referencing checks on tenants to ensure they can keep up with payments and won’t cause any problems.

As a landlord, you can carry out referencing and affordability checks yourself.

You can also get the help of a letting agent or professional tenant referencing company, just bear in mind you’ll need to pay for this.

For example, a professional referencing company can charge anywhere between £15 and £40 per tenant.

If you carry the checks out yourself, you could hold an initial phone or video call with the tenant to gauge their personality and also find out other useful information about them like what type of employment they’re in and if they smoke.

You could carry out a credit check on them, review their bank statements and ask their employer and previous landlord for a reference as well.

Sim Sekhon, group chief executive officer at Propoly, a platform for lettings agents, said: “Landlords and letting agents will need to place far greater focus on upfront due diligence, particularly around affordability, income verification, previous tenancy conduct and overall risk profiling before a tenancy begins.”

Do note, under the Renters’ Rights Act, it is now illegal for landlords to refuse to rent a property to a tenant receiving benefits or with children aged under 18.

Consider adding a pet policy to your tenancy agreement

The Renters’ Rights Act sets out that landlords cannot unreasonably refuse a tenant’s request for a pet. This part of the act came into effect in May 2026.

Therefore, it could be worth adding a pet policy to your tenancy agreement to avoid any disputes down the line.

Sián Hemming-Metcalfe, operations director at Property Inspect, a website for property managers, surveyors and landlords to manage property reports and inspections, said: “A well-drafted pet policy can help set expectations around issues such as cleaning responsibilities, flea treatment, nuisance behaviour and how any pet-related damage will be managed.”

As well as adding a pet policy to your tenancy agreement, it may be worth adding pet damage to your existing landlord insurance which would cover you in case of any accidents.

Hemming-Metcalfe added it could be worth writing out an inventory and agreeing on it with a tenant.

This will establish the condition of the property, including contents, general cleanliness, walls, floors and appliances, when they moved in and could help if a tenant disputes whether their pet has caused any damage down the line.

Start keeping detailed records and stay on top of compliance and property standards

Section 8 notices rely on strong evidence against a tenant, so it’s important landlords hold detailed records of all aspects of a tenancy which they can use to prop up a case that goes to court.

Hemming-Metcalfe said: “Maintain thorough inspection reports with photographic evidence, accurate maintenance records, rent payment histories and clear logs of tenant communication throughout the tenancy. Evidence of issues such as antisocial behaviour complaints or unresolved repair access can also become critical if matters reach court.”

Landlords must also ensure they’re keeping on top of property standards and compliance.

This includes ensuring Energy Performance Certificates (EPCs), gas safety certificates and electrical reports are valid and up to date and deposits are correctly protected through a tenancy deposit scheme. Repair issues will also need to be addressed promptly, with clear records maintained throughout.

Hemming-Metcalfe added: “Beyond avoiding fines, compliance will increasingly form part of a landlord’s ability to successfully pursue possession claims. In practice, maintaining accurate property records, inspection evidence and audit trails will become just as important as the physical management of the property itself.”

Are you a landlord affected by the Renters’ Rights Act and other recent legislative changes? If you'd like to share your story, get in touch by emailing editor@moneyweek.com.

The £1 million inheritance tax-free allowance figure is one of those numbers that has taken on a life of its own. Most people know about it, but very few have checked whether it applies to them.

At first glance, it seems straightforward. A couple has two nil-rate bands – also known as inheritance tax-free thresholds – at £325,000 each and two main residence nil rate bands at £175,000 each. Add the allowances together and you get £1 million you can pass on free of inheritance tax, which is otherwise charged at up to 40%.

But in reality, it is more complicated.

For example, if you’re married or in a civil partnership, any unused inheritance tax-free threshold can be added to your partner's threshold when you die. This tax perk does not apply to unmarried couples.

Sue Allen, chartered financial planner at Chester Rose Financial Planning, warns. “Care needs to be taken to ensure you qualify or know where you stand,” she says.

The issue usually lies with the £175,000 residence nil-rate band, which you could get if you give your home to your children or grandchildren. This extra allowance is often treated as part of the standard allowance. But it isn’t – and certain rules mean you may not get it.

When does the £1 million inheritance tax-free allowance not apply?

In practice, there are a few common scenarios where the main residence nil rate band is assumed to apply but doesn’t.

1. Couples without children

Couples without children are a straightforward example of where the £1 million inheritance tax-free allowance doesn’t apply.

“It is common for them to assume they are comfortably within the £1 million threshold, only to find that, without direct descendants, the main residence nil rate band doesn’t apply to them,” said Allen.

“At that point, the IHT allowance drops to £650,000 between them, which can come as quite a shock.”

2. Estates worth more than £2 million

The £2 million inheritance tax threshold acts as a tapering point for the residence nil-rate band. If your estate – total assets minus debts – is worth more than £2 million, the residence nil-rate band is reduced by £1 for every £2 that the estate exceeds this threshold.

If an estate's net value exceeds £2.35 million, the residence nil rate band is completely lost for a single individual. For a surviving spouse, the threshold for complete loss is £2.7 million.

“There is a growing number of people, particularly in London and the Southeast, who find themselves over the £2 million threshold without really thinking of themselves as having large estates. A property and a reasonable level of investments can get you there,” said Allen.

“We often find that, as a result, these clients don’t qualify at all for the main residence nil-rate band.”

Inheritance tax on pensions is due to change in April 2027, with most pensions being treated as part of the estate by HMRC for IHT purposes from then. This will increase the value of estates, potentially pushing them over the £2 million threshold when the residence nil rate band starts to taper.

3. Downsizers

Later-life decisions can create further complications when it comes to inheritance tax thresholds. Downsizing, for example.

There are rules that allow you to preserve a percentage of the main residence nil rate band when you sell a property – known as the downsizing addition or downsizing relief. However, these rules are not straightforward and require careful planning.

The amount of the downsizing addition will usually be the same as the residence nil rate band lost when the former home is no longer in the estate. Again, the amount of the preserved main residence nil rate band needs to be left to direct descendants to qualify.

It will also depend on the value of the other assets left to direct descendants. The downsizing addition cannot be more than the maximum amount of residence nil rate band available if the sale or downsizing had not happened.

The estate’s personal representative must make a claim for the downsizing addition within two years of the end of the month that the person dies. HMRC can extend this time limit in some circumstances.

You do not have to tell HMRC when the downsizing move, sale or gift of the former home happens. The estate’s personal representative makes a claim for residence nil rate band and any downsizing addition when filling in the inheritance tax returns.

You should keep the details of the move, gift or sale so that the estate’s personal representative can get that information when they make the claim.

You can only take one move, sale or other disposal of a former home into account for the downsizing addition. If the person that died downsized more than once, or sold or gave away more than one home between 8 July 2015 and the date they died, the estate’s personal representative can choose which to use to calculate the downsizing addition.

4. Blended families

Blended families are another area where things don’t always align when it comes to inheritances. They are increasingly common, but the inheritance rules haven’t kept pace. This can often lead to disputes over inheritances.

“It’s easy for assets to be passed in a way that makes perfect sense from a family perspective but doesn’t meet the technical requirements for the main residence nil-rate band,” said Allen.

For residence nil rate band purposes the direct descendant is:

• a child, grandchild or other lineal descendant
• a spouse or civil partner of a lineal descendant (including their widow, widower or surviving civil partner)

This also includes:

• a child who is, or was at any time, their step-child
• their adopted child
• a child fostered at any time by them
• a child where they’re appointed as a guardian or special guardian when the child is under 18

The person who inherits the home does not have to be under 18. But a person’s step-child is only someone whose parent is, or was, the spouse or civil partner of that person – cohabiting doesn’t count.

Direct descendants also do not include nephews, nieces, siblings and other relatives.

How to avoid the £1 million inheritance tax trap

The key thing to do is forget the £1 million inheritance tax-free threshold – unless it actually applies to your specific situation. If you’re able to, using gift allowances and giving gifts early on could reduce a potential inheritance tax bill, as inheritance tax is not charged on gifts made more than seven years before death.

“Plan around the actual position,” said Allen, from Chester Rose. “In many cases, that means starting to gift earlier rather than later, as the seven-year rule is only useful if there is enough time for it to work.”

Regular gifting out of surplus income is also often overlooked, despite being one of the more practical options available.

“However, careful record-keeping and a clear understanding of the rules are essential, as not all assumed income qualifies. It is also important to have a cash flow plan in place that identifies how much you can afford to gift and when. You do not want to leave yourself short in later life,” said Allen.

Wills might need to be revisited to ensure the structure doesn’t prevent the claiming of the main residence nil rate band, or that planning can be undertaken after death to ensure this can be claimed. “This is particularly important when trusts are incorporated into wills,” said Allen.

For those close to the £2 million threshold, even small adjustments can help preserve part of the main residence nil-rate band. Without such planning, it can disappear entirely.

“The £1 million figure isn’t wrong, but it is conditional,” Allen said. “The difficulty is that most people don’t realise how conditional it is until they look more closely at their own situation. By then, the number they have relied on for years isn’t quite right.”

Inheritance tax planning can be complicated and is highly individual to specific circumstances. It’s always a good idea to get specialist legal and financial advice before acting.

Councils have been given new powers to fine landlords up to £7,000 if they fail to fix poor housing conditions in their properties in the latest stage of the government’s rental reforms.

Large parts of the government’s Renters’ Rights Act have come into force, including a ban on so-called “no-fault” evictions, an automatic switch to rolling contracts and limits on how often rents can be increased.

Landlords had until 31 May to hand over the government’s Renters’ Rights Act Information Sheet 2026 document, detailing the changes to tenants or risk a £7,000 fine.

In the latest change as of 22 June, councils can now take stronger action where landlords fail to fix problems, alongside existing enforcement powers.

Fines of up to £7,000 can be issued if landlords refuse to fix poor conditions.

The fine will apply to 21 types of hazards that are found to be serious - the most dangerous level - which include freezing conditions, faulty electrics, fire hazards, structural issues and unsafe layouts.

The new penalty sits alongside existing powers councils can use to tackle unsafe homes that put tenants at risk. These include forcing repairs, carrying out emergency works and recovering costs from landlords who fail to act.

The landmark reforms have raised fears already squeezed landlords, particularly those on a small-scale, have been given more reason to abandon the market and sell up.

Landlords can be fined up to £7,000 for failure to comply.

But these aren’t the only compliance failures that could result in a fine.

What other rules will landlords need to follow?

Beyond providing the tenancy information sheet, there are other rules that landlords have to follow or face a fine for breaching.

Landlords can’t ask for or accept rent from a tenant before a tenancy agreement has been signed between both parties.

Landlords also cannot stop someone from viewing or renting a property just because they are on benefits or have children.

Rental properties also have to be advertised with asking prices, while landlords are banned from encouraging people to bid higher than this advertised price.

There will also eventually be a register that landlords need to sign up to or they will face a fine. A date for this hasn’t been set yet.

Councils will be responsible for issuing fines and there could be higher charges for repeated failures and landlords could even be banned for serious breaches.

Landlords ignoring the rules can be reported by their tenants or found through council inspections.

There are more changes coming as well as part of the wider rental reforms.

By the end of 2028, it will be mandatory for landlords to be members of a new Landlord Ombudsman and to be on the private rented sector (PRS) database before they can even list a property for rent.

Failure to register to the new PRS Database and ombudsman could lead to an up to £7,000 civil fine, or up to £40,000 repeat fine.

Additionally, the minimum requirement for Energy Performance Certificates (EPCs) is due to rise from E to C in October 2030, while the full Decent Homes Standard will be introduced in 2035.

Under the standard, properties must be free from hazards, in a reasonable state of repair and with reasonable services such as a kitchen and bathroom and free from damp or mould.

Landlords can be fined up to £30,000 if their rental properties are found to be below the Decent Homes Standard.

If you are renting your property through a lettings agent, it is worth checking with them if you are compliant.

Lettings agency Kinleigh Folkard & Hayward suggests keeping clear records of agreements, inspections and communications, adding: “A well-organised system can make compliance easier and support positive tenant interactions, including maintenance requests. Landlords may find it beneficial to work with partner agents who offer online software to help with record keeping and to manage the additional requirements.”

Rob Norton, UK director at property software brand PlanRadar, said: “As the new rules come into force, landlords and property managers will face significantly greater pressure to evidence activity across their portfolios in real time. Every inspection, repair and tenant interaction will need to be accurately recorded and easily accessible.

“However, many are still relying on disconnected systems to manage these processes, creating gaps in visibility and increasing the risk of disputes or delays.

“As a result, we’re likely to see an acceleration in the shift towards digital tools that provide a clear audit trail and a single source of truth across assets. In an increasingly regulated environment, that level of oversight is becoming essential.”

Millions of UK pension savers could be missing out on tens of thousands of pounds in long-term returns by delaying contributions until the end of the tax year, new data from digital pension provider Penfold had suggested.

The start of a new tax year is a natural catalyst for pension savers to make sure they are making the most of their annual pension contribution allowances. Paying into a pension before tax year end makes sense as unused annual allowances can’t always be recovered (beyond the carry forward rules).

But while this behaviour has become a consistent annual trend, it may come at a high long-term cost.

Take someone investing £10,000 at the start of each tax year. Over 25 years they could end up with around £24,000 more than someone who waits until the end of each year to contribute the same amount, assuming 5% annual growth, according to Penfold’s calculations.

Chris Eastwood, CEO at Penfold, said: “We see this pattern every year. Many people top up their pension close to the tax deadline.

“It’s great to see people taking action. But starting earlier gives your money more time to grow, and that can make a real difference over time.”

Paying into a pension before tax year end

Analysis of contribution behaviour on Penfold’s workplace pension has revealed a clear pattern of last-minute saving.

One-off pension contributions in March reached up to 4.4 times the average monthly level seen throughout the rest of the year.

This means a disproportionate share of pension saving is concentrated at the end of the tax year, with around one in five (around 22%) of annual contributions made in March alone.

The data also shows the average contribution value in March is around three times higher than in most other months.

But those who leave paying into a pension to the last minute with a one-off lump sum could be missing out.

How pound cost averaging could boost your pension returns

Waiting until the end of the tax year to make a one-off large contribution to your pension – rather than investing regular smaller sums – not only potentially gives your money less time to grow, it can also mean you miss out on the advantages of pound cost averaging.

Standard Life gives an example: if you invest a lump sum of £12,000 and the market then drops over the next year, your investment could end up down 10%.

But if you spread that investment out and invest £1,000 each month across the year and the market drops in the same way, then you buy into the market at a lower price each time, meaning your overall investment may only drop by 5% in total.

Though if markets rise rather than fall over the same period, you’ll make smaller profits than you would have if you’d invested the lump sum.

In contrast to one-off contributions, Penfold’s data also found regular monthly contributions remain broadly consistent throughout the year, which can help with long-term saving habits over last-minute decision-making (though all pension contributions are a good idea).

“The new tax year is a good moment to reset”, Eastwood from Penfold said. “Contributing earlier and more consistently can help savers make the most of compounding and build stronger financial futures.

“Small, regular contributions throughout the year can be a simple way to build a bigger pension over time.”

Business owners and farmers must play by strict new rules when it comes to passing on assets, after changes went live at the start of the new tax year on 6 April. But some families will be left much worse off than others under the switch.

The beneficiaries of unmarried couples, divorcees and single farmers and business owners could face paying potentially hundreds of thousands of pounds more in inheritance tax compared to if they had been married, following the implementation of the controversial changes to some IHT reliefs this month.

Sean McCann, chartered financial planner at NFU Mutual, said: “While married couples can potentially leave up to £6.3 million of qualifying agricultural and business assets free of inheritance tax, the same is not true for single farmers or divorcees who haven’t subsequently remarried who are limited to a maximum of £3.15 million.”

What are the new APR and BPR rules?

Businesses and farms are entitled to what’s known as business property relief (BPR) and agricultural property relief (APR) – these reliefs limit the amount of inheritance tax due.

In the 2024 Autumn Budget, the government announced plans to cap the value of agricultural properties and businesses that could be passed on free of inheritance tax to £1 million – anything above that level would only get 50% tax relief.

Inheritance tax is charged at 40%, so the change would effectively introduce a 20% tax rate on the value of inherited farms or businesses over £1 million.

Following pressure from farming and business groups, the government amended the policy in December 2025, announcing it would raise the cap to £2.5 million.

It also permitted the allowance to be inherited by a spouse or civil partner – on top of existing allowances of £325,000 IHT-free per person, plus the nil rate residential allowance of £175,000 per person – boosting the amount that could be passed on IHT-free to £5.65 million.

But certain groups are set to miss out on the more relaxed rules, leaving their families with much bigger inheritance tax bills.

Hardest hit by new inheritance tax rules

Married couples and civil partners have significant advantages when it comes to inheritance tax planning. Anything left to the surviving partners after the first death is normally free of IHT.

The survivor can also benefit from any unused part of their late spouse’s £2.5 million inheritance tax-free APR and BPR allowance as well as the £325,000 inheritance tax-free allowance.

Unmarried couples do not benefit from the spousal exemption, meaning that leaving assets to a surviving partner could trigger a bigger IHT bill. In this case, while the deceased’s £2.5 million APR and BPR allowance and £325,000 tax-free allowance would cut the amount of IHT payable, only the survivor’s allowances would be available on the second death when passing assets to the younger generation – not the combined allowances as would be the case of a married couple.

Divorcees also miss out – while widows and widowers can benefit from their late spouse’s unused £2.5 million 100% APR/BPR allowance, regardless of whether they owned agricultural or business assets, the same is not true of divorcees who have not remarried. Beneficiaries of divorcees can only benefit from the person who has died’s allowances.

Bigger inheritance tax bill

McCann from NFU Mutual has highlighted one example which shows the significant difference in the IHT bill depending on whether the deceased is a widower or a divorcee.

Take Steve, who owns a farm and business assets worth £6.5 million. He has:

• 300 acres worth £3.5 million
• machinery and stock worth £1 million
• farmhouse and buildings worth £2 million

The table shows the difference in how Steve would be treated for inheritance tax purposes depending on whether he is a widow or a divorcee.

Ways to avoid inheritance tax

There are some strategies those affected by the changes to agricultural property relief and business property relief can use to help avoid inheritance tax or reduce their inheritance tax bill.

Couples who are not married face additional complexities as they don’t benefit from the tax-free exemption available to spouses. This means leaving assets to a common law partner could trigger an inheritance tax liability, followed by a second charge on their subsequent death.

“Unmarried couples who want to maximise the amount passed on to younger generations could consider using the £2.5 million 100% APR and BPR allowance and £325,000 tax-free allowance to leave assets to the younger generation on first death, leaving the survivor free to do the same,” said McCann.

For those unmarried couples who don’t wish to get married, it’s important to take advice on the advantages and disadvantages of this approach before taking any action, he said.

McCann added: ‘’Before the inheritance tax proposals were announced, the approach of many farmers was to gradually hand over more of the day-to-day management to the younger generation while holding onto the ownership of the assets until a later date.

“The new rules will prompt many to pass on the assets at an earlier stage, because if they live seven years [after giving the gift], they would normally be free of inheritance tax.

‘’For that to work it’s important that the farmer doesn’t continue to benefit from the assets they give away. If they intend to continue in the business, they’ll need to pay a market rent to the new owner or if in partnership with them, reduce their profit share to reflect the new ownership.’’

Many Brits are facing a huge gap between when they want to retire and when their savings will actually let them, new research says – with some currently on course to have to wait more than two decades longer.

On average, people would like to retire at age 61 – five years before the current state pension age of 66 (rising to 67 in April), according to a study on Britain’s retirement expectations – and how financially prepared people are to meet them – by savings platform Flagstone.

But currently only 14% of people are on track to meet that milestone with their desired savings amount to retire comfortably.

Katie Horne, savings expert at Flagstone, said: “The fact only 14% of Britons are on track to retire when they want to is a wake-up call – but it's not insurmountable. Even those on six-figure salaries face a gap of over a decade between their desired and realistic retirement age. That shows this is as much about strategy as it is about income.”

What is your real retirement age?

The projected retirement pot of everyone surveyed – from a group of 2,000 in February – was modelled using a 5% annual growth rate and their current yearly pension contributions.

Respondents were classed as ‘on track’ if their projected pot would meet the amount needed for their chosen retirement income and age.

When it comes to income, those in the survey said they would need around £56,822 a year in pre-tax income in retirement. The pensions association Pensions UK estimates you would need, after tax, around £43,900 for a single person for a comfortable retirement, which is about the same amount.

Based on a pre-tax income level of £56,822 per year, a retirement age of 61, and the 4% withdrawal rule, the retirement pot required to support this lifestyle is around £1.42 million, according to Flagstone’s calculations, in a drawdown pot not an annuity.

However Brits aged 55 and above – the demographic closest to retiring – currently only have an average total of £146,668 saved for retirement, according to Flagstone’s research. The average contribution, across all demographics, is around £6,963 a year.

At this rate, most people won’t be able to retire until the age of 83 – a 22-year gap between aspiration and financial reality by Flagstone’s calculations.

This also means less time to enjoy retirement, with Office for National Statistics (ONS) life expectancy figures showing the average woman lives until 83, while it’s 79 for men.

Some amount of gap between desired and likely retirement is consistent regardless of income. Even those earning over £100,000 face an average ‘retirement readiness gap’ of more than ten years.

The research also showed a stark gender pension gap. The average man has £141,663 saved for retirement and contributes £7,435 a year. Women, by contrast, have saved £78,171 – roughly half as much – contributing £6,363 annually.

Closing the gap

Brits are actively doing what they can to save for retirement. A workplace pension remains the most common way to save, according to the research, used by 60% of people, followed by savings accounts (57%), and private pensions (41%).

One obvious way to grow your pension pot is to increase contributions (42% of those surveyed said they would consider this). But other tactics included speaking to a financial adviser (33%), and reviewing pension providers and fund performance (29%).

Horne from Flagstone, said: “For many, saving more is only part of the answer. Making sure existing savings are thoughtfully placed can be equally important. That might mean consolidating old pension pots, moving cash into accounts paying higher interest rates, or switching to an investment fund with stronger long-term performance.

“Even among experienced savers, time is often an overlooked factor in retirement planning. The sooner you act, the more interest you earn – and the longer that interest has to grow.”

A group of 270 UK individuals are part of an exclusive community that is technically open to everyone in the country, if you have the time, money and investment performance to join – the £2 million ISA club.

The figure, revealed in a Freedom of Information request to HMRC by financial planning firm Bowmore Wealth Group, showed just what is possible if you take your ISA savings ultra seriously over the long term.

By investing the full annual ISA allowance of £20,000 – equivalent to £1,666 a month – in a stocks and shares ISA and achieving an average annual return of 7%, investors could build a £2 million tax-free portfolio over three decades, according to Bowmore’s calculations.

John Clamp, chartered financial planner at Bowmore, said: “Reaching a £2 million ISA pot is no longer an unrealistic ambition for investors and could be achieved tax-free in as little as 31 years with consistent investing.”

We look at some of the best stocks and shares ISAs in a separate article.

The benefits of long term investing

The findings highlight the growing importance of ISAs as a long-term wealth-building tool, particularly as more savers look to make the most of tax-free returns.

However, Bowmore warned many investors risk falling short of their goals by holding too much in cash ISAs for too long or by dipping into their savings prematurely.

While cash ISAs may appear to offer security, their lower returns can significantly slow wealth accumulation over time – often shrinking in real terms due to inflation. In contrast, investing in equities can dramatically accelerate long-term growth, particularly when returns are compounded.

Clamp said: “ISA millionaires are becoming increasingly common but the next milestone – the £2 million ISA – is already within reach for many investors who take a long-term view.”

“The real difference comes down to behaviour. Consistently investing the full allowance and allowing returns to compound over time can turn what seems like an ambitious target into something very achievable.”

From £1 million ISA to £2 million ISA

Separate research by investment platform AJ Bell found it takes 25 years of saving £1,433 a month – or £17,196 a year, less than the £20,000 annual allowance – to build up a £1 million ISA. But it only takes a further 10 years to make it to the £2 million mark. This is assuming you get 6% growth on your investments.

Laith Khalaf, head of investment analysis at AJ Bell, said: “It’s no walk in the park to build up a million pound ISA, but once you get there, hitting new milestones becomes increasingly easy because you have a huge tailwind from growth on the money you’ve already stashed away – known as compound growth.”

He added: “Compound growth is a formidable force, though you do have to be diligent and patient to harness its power. Clearly the higher the return you achieve on your investments, the more powerful the effect of compound growth on your wealth.”

Over the long term, then, a cash saver is likely to see a weaker compounding effect than an investor putting their money into the stock market, though the investor will of course see greater fluctuations in the value of their holdings along the way.

Effects of compound growth

“Compound growth is a wonderful thing when you break it down,” said Khalaf. “Even to reach your first million pounds in 25 years, you would only need to save less than half of this sum, or £429,900, because the remainder would be made up by growth on the savings you make (assuming 6% net fund growth).

On this basis, after 12 years of saving £1,433 a month, your annual ISA fund growth is already exceeding the £17,196 you’re putting away each year. This effect gets turbocharged the more you save, because of the growth on the pot of money you’ve already built up.

Khalaf said: “This explains why it only takes 10 years, rather than 25 years, to save your second million. In other words, it’s 2.5 times easier to save your second ISA million than your first.”

This is reflected in the amount you need to save as well. To get from £0 to £1 million in 25 years you need to stump up £429,900. But to get from £1 million to £2 million by saving £1,433 a month, you would only need to stash away £171,960 yourself.

Over a decade of saving, you would receive £859,189 in growth, because not only are your new savings growing, but so is the million pounds you’ve already built up in your ISA.

Source: AJ Bell, based on 6% net fund growth per annum. Numbers do not add to round millions as they have been calculated based on whole years of saving.

To get to your third million would only take a further six years of saving £1,433 a month. During this time you would only need to stump up £103,176 in savings, with £874,067 accruing in fund growth.

In total that means 41 years of saving £1,433 a month to get to £3 million.

“If you are in the fortunate position to be able to do that, over the course of those 41 years, you would have stashed away £705,036, with the remaining £2,303,414 coming from fund growth,” Khalaf pointed out.

Wealthy expats who moved to Dubai to escape the UK’s rising taxes are being warned about the fiscal implications of returning amid the Iran war.

Location such as Dubai have attracted wealthy households in recent years amid frozen thresholds and tax allowances in the UK, which have caused fiscal drag.

Many expats who moved to Dubai are now reported to be returning to the UK amid the escalating tensions in the Gulf region.

But they could land themselves with an unexpected tax bill.

Accountancy firm Price Bailey has warned people who recently moved to Dubai may inadvertently fall foul of the UK’s five‑year temporary non‑residency rule.

This is an anti‑avoidance measure designed to stop individuals leaving the UK briefly to dispose of assets tax‑free in low‑tax jurisdictions such as the United Arab Emirates (UAE) before returning soon after.

Nikita Cooper, director at Price Bailey, said: “The immediate focus is usually on income, which is taxed as it’s earned, but the far bigger issue is capital gains tax (CGT), which is often overlooked.

“Someone returning to the UK from Dubai for a short period may face some income tax, but that is manageable, unlike a large one‑off CGT bill.”

The tax risks of returning to the UK

The big risk for those returning to the UK from Dubai after a short period is CGT.

Under HMRC’s temporary non-residences rules, if an individual becomes UK‑resident again within five full tax years, capital gains realised while abroad are effectively “brought back” into the UK tax net and taxed in the year of return in certain circumstances.

Price Bailey adds that the same CGT trap affects individuals in the UK who were preparing to emigrate to Dubai and are in the advanced stages of selling businesses or second non-UK homes, but who are now hesitant to leave due to safety concerns.

Price Bailey said returning to the UK increases an individual’s “day count” under the Statutory Residence Test (SRT).

If this results in UK residency being triggered before five full tax years have elapsed, the temporary non‑residence rules can apply.

Cooper added: “What catches people out is that if they return within five years, gains on assets held before departure and sold while in Dubai are effectively ‘revived’ and taxed in the year of return. It’s the retrospective nature of the rules that tends to surprise people.”

This means people who may have sold UK businesses or second non-UK homes while tax‑resident in Dubai could now face paying CGT at 24%. For many, that could amount to tens or even hundreds of thousands of pounds.”

Price Bailey said it is aware of clients who were planning to emigrate to Dubai but have now paused the sale of businesses and second homes while they reassess their options.

Another risk is the UK’s Statutory Residence Test (SRT), which determines whether someone is classed as a UK tax resident. This may be an issue if flights are unable to return to Dubai or other parts of the United Arab Emirates.

Anyone who spends 183 days or more in the UK during a tax year automatically becomes a UK tax resident. But there are key caveats.

Below the 183-day threshold, residency depends on both the number of days spent in the UK and an individual’s ”ties” to the country.

Wealth manager Evelyn Partners has warned that someone who has previously lived in the UK, tax residency can potentially be triggered with as few as 90 to 120 days in the country if they maintain multiple ties, which is common.

How expats can minimise their tax bill when returning to the UK

The bad news for returning expats is that there isn’t much they can do about reducing their tax bill if they only recently left the UK.

However, HMRC is reportedly examining whether tax concessions could be introduced for Britons forced to return due to instability in the Middle East.

HMRC can disregard up to 60 days spent in the UK due to “exceptional circumstances,” but accountants have warned that this relief is unlikely to apply for those coming back from Dubai because individuals can travel to alternative destinations.

A key uncertainty is official travel advice.

David Little, financial planning partner at Evelyn Partners said the exceptional circumstances rule has historically been applied when the Foreign, Commonwealth and Development Office advises citizens to “avoid all travel”.

He said: "The UAE currently sits at the lower warning level of “all but essential travel”. Crucially, these are not equivalent.

"This distinction leaves significant ambiguity over whether evacuations or safety-related returns from the UAE would qualify for relief under the exceptional circumstances provision."

When it comes to the UK statutory residence test, Amal Shah, tax partner at accountancy and advisory firm Gerald Edelman, said the biggest risk for individuals is slipping up on their day count.

Shah said: “If you breach the limits you can very easily end up being treated as UK‑resident for the whole tax year, even if that wasn’t your intention.

“Once you fall back into UK residence, you also need to be mindful of the Temporary Non‑Residence (TNR) rules. These rules are deliberately tough.

“If you return to the UK within the relevant timeframe, any income or gains you realised while you were non‑resident, can be pulled back into charge.

“That can cover a wide range of things, from asset disposals to certain distributions or pension withdrawals, so the impact can be significant.

“A common misconception is around exceptional circumstances. HMRC takes an extremely narrow view of what counts. Simply leaving another country because of a situation there and returning to the UK won’t normally qualify.

“In HMRC’s eyes, exceptional circumstances only really apply when you are already in the UK, and something genuinely outside your control prevents you from leaving. That’s a very high bar, and HMRC sticks to it.”

Little adds that expats returning to the UK may qualify for split-year treatment. Normally, a person is either resident or non-resident for a full tax year.

But if someone leaves or returns partway through the year, the tax year can be divided into a “UK resident portion” and an “overseas portion”, potentially keeping foreign income outside the UK tax net.

Split-year treatment is not automatic though and must be claimed through self assessment.

Little added: "Until HMRC issues any clarification, expats considering temporary returns should carefully monitor their UK days and ties, plan travel around thresholds, and file appropriate forms to claim split-year treatment where relevant. As always, seek professional advice.

"Small changes in travel behaviour can be the difference between remaining outside the UK tax net and falling fully within it, a situation often reduced to a ‘health versus wealth’ dilemma, with no easy outcome."

A spokesperson for HMRC said: “The existing rules already take into account exceptional circumstance, such as people being affected by war, while following the basic principle that those living in the UK should pay tax in the UK.”

Investors are being urged to consider consolidating their stocks and shares ISAs onto one investment platform, but there are risks to be aware of.

With the end of the tax year approaching, investors have just weeks to make use of their ISA allowance and there are also plenty of cashback incentives around to transfer your tax-free savings from previous years.

Research by interactive investor found a third of investors currently have more than three different providers holding their ISA or pensions and almost half have two.

The platform claims investors with a £75,000 portfolio split between three providers, could save £844 over a five-year period by consolidating into a single account with interactive investor, which charges a flat fee rather than a percentage of the portfolio's value.

This assumes investment growth of 5% per annum and a £25,000 investment with three providers: Hargreaves Lansdown, AJ Bell, and interactive investor.

There are other factors to consider though such as trading fees, the product range on offer and functionality such as apps and research tools as well as customer service.

Other investment platforms may even work out cheaper, depending how much you invest and how regularly you are trading shares or funds.

For example, interactive investor’s cheapest plan starts at £5.99 per month or £71.88 a year.

But Scottish Widows Share Dealing, formerly IWeb, which is owned by Lloyds Banking Group, doesn’t charge any annual or ongoing fees. Trades cost £5 each.

Aside from fees, there are other factors to consider if you plan to consolidate your ISA.

Why consolidate your ISA?

Consolidating your ISA can mean paying one fee, which ideally should work out cheaper

It also give you a more complete view of your finances.

Brian Byrnes, director of personal finance at Moneybox, said: “The biggest win for consolidation is simplicity. With a single provider, you don’t have to juggle multiple accounts, passwords, and apps.

“On top of this, a single view allows you to see your progress instantly. It’s simpler to know exactly how much you have saved for your house deposit, your emergency fund, or your retirement when it’s all on one dashboard. This visibility helps you stay motivated and make faster, more informed financial decisions.”

Consolidating your ISA gives you more control and helps avoid duplicate holdings.

Plus it can help set a clearer strategy.

Ben Faulkner, of EQ Investors, said: “Bringing a portfolio together helps you check you’re properly diversified and haven’t invested more in some areas than you’d intended.

“You may want to invest in companies that are environmentally and ethically aware and look after their employees, but are you confident all your investments follow this approach?

“Consolidating your ISAs can help to ensure your aligning investments with your personal values.

Another benefit is estate planning for inheritance tax.

Rachael Griffin, tax and personal finance expert at Quilter, said: “With the government confirming that pensions will fall within the scope of inheritance tax from April 2027, consolidating financial accounts is likely to become more important for many families.

“This change means more estates will be pulled into inheritance tax and a single, well‑organised ISA structure will make life far easier for executors working through IHT reporting requirements.”

What to watch out for when consolidating an ISA

There may be downsides to consolidating though, particularly if there are exit fees.

Griffin says cost savings are possible, although not guaranteed.

She said: “Some platforms favour larger portfolios with flat fees, while others suit smaller balances with percentage charges. Consolidation only pays if the chosen platform’s structure is genuinely cheaper once everything is under one roof.

“The potential downsides are mostly practical. Exit fees, loss of preferential fund classes and the risk of being out of the market during a transfer all need weighing up. Not all assets can transfer in specie, and specialist holdings may not be fully portable.

Nouran Moustafa, practice principal at Roxton Wealth, says people need to watch carefully for exit fees, transfer costs, loss of access to certain funds or tax wrappers, and the risk of ending up less diversified than they were before.

She said: “The key is to consolidate with purpose, not just for convenience, and to make sure the new home is genuinely better, not just tidier.”

Giving your money away to your loved ones when you are alive is one way to avoid them having to pay inheritance tax (in many cases). But what if you later need that money to pay for your care? HMRC might come knocking.

With an estimated four in five people aged 65 and over likely to require some level of looking after before they die, according to the 2025 House of Commons Committee Report on Adult Social Care Reform, millions of families could find themselves having to deal with the cost of care.

Many individuals will also be keen to leave an inheritance, however, and gifting the money during your lifetime is one of the best ways to help your loved ones avoid an inheritance tax bill, providing certain conditions are met (like the seven year inheritance tax rule).

This clash between potentially paying for care and giving away money to loved ones can lead to a difficult juggling act in terms of timing any inheritances.

Give away the money too soon and you’ll have less income to enjoy yourself. But give the money away too late and then find you need care and you could fall foul of the ‘deprivation of assets’ rules, leading you or your loved ones into a fight with HMRC and potentially having to pay the money to the local authority.

We look at care fees annuities as a way to pay for care and whether you should get advice about care for a relative in separate articles.

Deprivation of assets rules – what are they?

Deprivation of assets occurs when a person knowingly reduces their capital – by gifting, transferring, spending, or restructuring it – in order to reduce the amount they would have to contribute towards their care costs.

Rebecca Minto, senior associate at law firm Mills & Reeve and director at the Association of Lifetime Lawyers, explained: “If a local authority decides deprivation has occurred, it can treat the person as if they still own the asset and, in some cases, pursue the recipient of the asset to recover charges.”

A deprivation finding typically requires that:

• There was a transfer or disposal of an asset (capital, property, investments, etc.). 
• Avoiding care charges was a significant intention behind the disposal (it need not be the only or main motive). 

What councils consider in care costs cases

In care costs deprivation of assets cases, councils will consider two main factors to judge if the assets were given away in a fair way:

1. Foreseeability

The local authority asks whether the person “could reasonably foresee needing care” at the time of they gave the assets away, and also that they could ”reasonably have expected to need to contribute towards cost of that care”, said Minto.

2. Intention over timing

A common misconception is that there is a “seven year rule” for care funding – but that exclusively belongs to the rules on inheritance tax. Instead, local authorities focus on intention and foreseeability, not the time that’s elapsed.

Avoiding care charges has to be a significant intention behind the disposal, though it need not be the only or main motive.

“In this case ‘significant’ simply means that the intention to reduce your contribution to care fees was one meaningful part of the reasoning,” said Minto, “and this threshold is very low”.

What if the local authority finds deprivation of assets?

If the local authority decides you or your loved one gave away assets specifically to avoid paying for care, it could do one of two things:

• The local authority can treat the person going into care as still owning the asset (known as ‘notional capital’), which can deny or delay funding and increase assessed contributions. 
•  The local authority may pursue the transferee (the recipient of the assets). 

Ways you can by caught by the care fees rules 

When it comes to looking for evidence assets were given away to avoid care fees, the local authority will keep its eye out for certain factors.

"The following behaviours could lead to deprivation findings, especially when undertaken as health declines or care becomes foreseeable,” said lawyer Minto.

• Outright gifts of cash or assets (e.g., large, one-off transfers to family that are out of character). 
• Transferring or adding someone to the legal title of your home (e.g., signing over the property to a child). 
• Selling significant assets at an undervalue (e.g., a £300,000 house sold to a relative for £50,000). 
• Transfers into trust where a significant purpose is to protect wealth from care charges. 
• Using a deed of variation to redirect an inheritance  
• Paying off someone else’s debts  
• Sudden extravagant or uncharacteristic spending patterns that rapidly deplete capital  
• Any disposal (even with mixed motives) where avoiding care fees was a meaningful factor and care needs were reasonably foreseeable. 

How to legitimately give away assets

“The law does not stop you from giving away assets,” Minto said, “but it does provide remedies to local authorities if they can show that you did it with the intention of avoiding care charges”.

To stay on the right side of the rules, from Minto’s legal view she recommended sticking to three main safeguards for legitimate gifting.

1. Gift while in good health, independent, and without reasonable expectation of needing care. 
2. Be clear about genuine, non-care-related reasons for the gift. 
3. Keep records (e.g., correspondence, adviser notes, side letters) that show your reasoning. 

Examples of legitimate gifts 

It’s fine to give so-called legitimate gifts – what constitutes legitimate varies but Minto gave some examples, such as:

• Helping family for genuine reasons: e.g., a deposit for a first home, education costs, or short-term hardship support, given when you are well and not anticipating care. 
• Repaying an existing loan: returning money previously borrowed from a relative or friend. 
• Long-term estate and inheritance tax planning implemented well before any care needs are foreseeable, where avoiding care fees is not a significant motive. 

What are mandatory disregards?

When it comes to deprivation of assets and care costs, there’s a whole raft of what’s known as ‘mandatory disregards’.

Lawyer Minto explained: “If capital falls within a mandatory disregard under the Care and Support (Charging and Assessment of Resources) Regulations 2014, the local authority must disregard it.”

The following are examples of mandatory disregards:

• If a property is someone’s main home and they go into care, but leave a non-estranged spouse/civil partner/cohabitee in occupation, then the local authority can’t take that into account as part of their care fees assessment.
• The property must be disregarded if occupied by a close relative aged 60 or above. 
• If a close relative is incapacitated/disabled.
• If a child under 18 who is dependent on the person lives in the property, the value must be disregarded. 

The regulations also require certain types of capital to be disregarded for at least a set period.

A mandatory 12-week disregard applies when:

• A person first enters permanent residential care, or
• A previous property disregard ends unexpectedly (e.g., the qualifying relative dies).

“Certain personal injury trust monies and some forms of compensation related to disability or illness are mandatorily disregarded for financial assessments under the Care Act,” Minto said.

No one is immune to fraudsters and anyone can be ensnared – but one three-digit number could prevent you from falling victim.

Scammers will take every opportunity they can to steal from you, with over four million cases of fraud recorded in the year to September 2025 – up 8% on the previous 12-month period, according to the latest Crime Survey for England and Wales.

This included a 19% rise in bank and credit account fraud, with roughly 2.6 million cases reported, and a 5% rise in consumer and retail scams, with 1.1 million incidents reported.

We’ve all had a call from someone pretending to be our bank, but how do you know when it’s real and when it’s not?

This is where 159 comes in. While the number is part of a huge initiative to combat fraud, it seems few people know about it.

Here’s everything you need to know about the number, how it works and how to use it to stop scammers in their tracks.

What is 159?

The three-digit number was set up by Stop Scams UK, a consortium of banks, building societies, tech and telephone firms to give consumers a quick way to check if a suspect text message or call could be fraudulent.

It was launched to prevent banking customers from falling victim to impersonation scams, where a fraudster calls or texts you pretending to be your bank and claiming you need to take action.

One example could be a scammer saying fraud has been detected on your account and that you need to move money to another bank account.

Stop Scams UK says the number is there to break the scam ‘journey’ by asking people to employ the motto: ‘Stop, hang up, call 159’.

While there are a number of fraud incidents related to pension scams and investing scams, 159 has been set up to tackle banking scams.

Over a million calls have been made to 159 since its launch in 2021. The number is available to most UK banking customers.

Calls to the number are charged, with the cost varying depending on your phone provider.

Once you’ve called 159, you’ll usually be asked to select what bank you’re a customer of and then be transferred to its fraud team who will confirm whether the call or message was legitimate or not.

What banks are signed up to 159?

The 159 number connects customers of more than 99% of the UK’s retail bank current accounts with their bank, according to Stop Scams UK.

You can connect to any of the below banks by making a call via the major UK phone providers. This full list is: BT (including EE and Plusnet), Gamma, O2 (including giff gaff), Sky, Three, Vodafone, TalkTalk and Virgin Media.

Here is the full list of banks and building societies that can be contacted through the number:

• Bank of Ireland UK
• Bank of Scotland
• Barclays
• Cater Allen Private Bank
• Chase
• Co-operative Bank
• Danske Bank
• First Direct
• Halifax
• HSBC
• Lloyds
• Metro Bank
• Modulr
• Monzo
• Nationwide Building Society
• NatWest
• Revolut
• Royal Bank of Scotland
• Santander
• Spring
• Starling Bank
• Tide
• True Potential
• TSB
• Ulster Bank
• Virgin Money
• Zempler Bank

Who should you call if it’s a pension or investment scam?

While 159 covers banks, pension and investment services are not.

If you get a call from someone claiming to be your pension or investment provider and you're suspicious, the best recourse to take is to hang up, or if it’s a text message, ignore it. You should then call your pension provider or investment broker on its official number.

If you are being pressured to part with your cash, then it is usually a scam.

If it transpires that the contact was an attempt by a scammer, you can register the incident with Report Fraud, the UK’s national reporting centre for fraud and cybercrime.

You can get in touch with Report Fraud via its website or by calling 0300 123 2040.

The Financial Conduct Authority also has a list of known investment and pension scams on its website, while the regulator launched a scam checker tool in 2025.

That said, if the scam call involves you making a bank transfer or your bank account security could be compromised, call 159.

Pay into a pension as early and for as long as possible is the standard advice. But for those of us able to take that route, is it still worth paying into a pension as we get close to retirement? What are the benefits of pension saving into your 60s? Is it worth it at age 70?

These questions have become more complicated by the government’s decision to include pensions in inheritance tax (IHT) calculations from April 2027.

Currently, unused pensions are not subject to inheritance tax, and paying in extra to boost pension savings has been also used as a way to reduce the inheritance tax bill your loved ones receive when it comes to passing on wealth. From next April, pensions will no longer be a viable way to avoid IHT.

Even beyond inheritance tax considerations, when working out how much you need to retire, is there really much gain to be had from paying into a pension just a few years before you need to spend it?

Sue Allen, chartered financial planner at wealth manager Chester Rose, said: “This should be considered in the context of your financial plan – do you need to save more? If you have enough, you may as well enjoy it. Life isn’t a dress rehearsal.”

However, if you are in a position where you could save more into your pension, but are on the fence, you might be swayed either way by seeing some cold, hard numbers. Wealth adviser Chester Rose has conducted exclusive analysis for Moneyweek to test the benefits.

We also compare an ISA vs pensions for retirement saving in a separate article.

Pension tax-free cash

A big benefit of pensions is that they allow you to build up a significant tax-free cash lump sum – the lump sum allowance (LSA). This is set at 25% of the pot you are ‘crystallising’ (taking benefits from) up to a maximum amount of £268,275.

To reach this maximum tax-free cash, you would need an overall pension pot of £1,073,100.

Simply put, if you still have some allowance left in your 60s – that is, you have a pension pot of less than £1,073,100 – then you can build up tax-free cash. Money you will not pay tax on when you come to withdraw it.

“That must be attractive. We don’t have many tax perks left in the UK, but this is certainly one of the best,” said Allen.

Pension tax relief vs marginal pension withdrawal tax rate

When it comes to paying into your pension during your 60s – likely to be your peak earning years – it is also worth considering the difference in the tax you pay now versus the income tax you may pay in future.

Most people have a personal allowance of £12,570 with zero tax on income at this level. Then, from this amount up to £50,270, you pay basic-rate tax at 20%, not including National Insurance Contributions. Over this, you are paying 40% and over £125,140, you’re paying 45%. (Though thanks to a quirk in the tax laws, people earning above £100,000 pay an effective 60% income-tax rate on part of their salary.)

You get tax relief on pension contributions at your current marginal income tax rate (up to the £60,000 annual allowance).

If you are a higher- or additional-rate taxpayer now and expect to be a basic-rate taxpayer in retirement, then putting money into a pension and getting 40% or 45% tax relief now, and only paying 20% income tax at a later date, is a decent strategy.

“What’s even better is if you took a pension income using part tax-free cash, then your effective tax rate is actually 15%,” Allen pointed out.

How much could my pension still grow in my 60s?

A key consideration when evaluating whether to continue contributing to a pension in your 60s is the growth factor – specifically, how much your pension might increase from, for example, age 60 to a retirement age of around 68. Chester Rose crunched the numbers on this.

For simple maths, let’s consider the value of £1 invested in a pension (a gross, i.e. before-tax, contribution) with an assumed growth rate of 5% and not taking into account inflation.

By Chester Rose’s calculations, that £1 would grow to £1.4775 over eight years (from age 60 to age 68, at a 5% growth rate).

Now we need to multiply this by the average pension pot of a 60-year-old. According to average pension data by age, someone in the 55-64 age bracket has an average pot of £137,800.

From age 60 to age 68, based on that same growth rate, this pension could increase from £137,800 to £203,600. That is a 47.7% increase. So clearly, there is sizable growth potential even without any further contributions.

However – from the same starting point, £137,800, and same 5% growth rate – but with an added £500 a month in gross pension contributions from age 60 to age 68, the pot could be boosted further to £263,752, by Chester Rose’s calculations. That’s a 91% increase on the original starting pot (including your contributions).

What about inheritance tax?

Now, you may well be thinking, what is the point of all this diligent pension saving, if it is going to be taxed when I die (from April 2027).

Consider this: you already have an estate that exceeds both the inheritance tax-free threshold (also known as the nil-rate band, currently £325,000 per person) and the residential nil rate band (an additional £175,000 per person). Essentially, this means assuming your loved ones will pay 40% IHT on your unused funds upon your death, whether in a pension or an ISA. Which makes you better off?

So, let’s assume you put £10,000 in the pension at age 70 and it grows at 5% per year. You then die at 100.

The calculation is complex, but the result is that £10,000 increases to £42,219, according to Chester Rose’s figures.

Your loved ones then pay inheritance tax at 40%, leaving £25,931 after tax to pass to beneficiaries, so £16,287 in IHT is paid.

Now let’s assume instead that you pay tax at the basic rate (20%) and put that £8,000 (£10,000 after 20% tax) into your ISA at age 70, and then leave it until age 100.

It grows from £10,000 to £34,575. Your loved ones pay £13,830 tax upon death, so you have £20,745 to pass to beneficiaries.

“So yes, you paid more inheritance tax by investing in the pension option – but the amount to pass to beneficiaries is still larger, at £25,931 versus £20,745 – a difference of £5,185.65,” Allen, from Chester Rose, said.

Is it still worth paying into a pension at age 60?

The figures speak for themselves – growing cash gross in a pension can significantly boost your wealth, even from age 60.

“Recent government changes have certainly made pensions less attractive as a wealth transfer tool. However, do not let that obscure what it is – a very efficient way to save, even in later life,” said Allen from Chester Rose.

However, something to remember is that turning 75 acts as a major tax milestone for private pensions, ending tax relief on contributions and changing death benefit taxes.

After 75, you can no longer get tax relief on personal contributions, though employer contributions may continue. Also if you die after age 75, your beneficiaries usually pay income tax on inherited pensions, and from 6 April 2027, these will be included in the estate for inheritance tax.

As always, the general advice to get the most bang for your buck with pension saving is to start as early as possible. And if in doubt, speak to a financial adviser.

BrewDog was once the poster-brand for crowdfunding but its collapse has left a bitter taste of the risks of backing smaller companies.

The drinks brand launched in 2007 and built up a following helped by 200,000 investors, known as EquityPunk, funding it to the tune of £75 million.

As well as pouring money into the most popular funds and stocks, investors often look to crowdfunding to back smaller firms.

Brewdog was renowned for quirky craft beers and expanded into bars but more recently was dogged by rumours about a poor workplace culture and suffered financially since the pandemic.

The brand had failed to make a profit in recent years, building up debts, which led to it falling into administration and being acquired by Tilray Brands this week.

The deal will keep its brewery operations and 11 pubs open in the UK but 38 bars will be shut and almost 500 jobs will be lost.

There is more pain to swallow for its EquityPunk investors though as they will not see a penny from their crowdfunding investment.

Dan Coatsworth, head of markets at AJ Bell, said: “BrewDog’s rescue deal emphasises the risks of using crowdfunding schemes to invest in companies and how it is very different to buying shares on the stock market.

“Crowdfunding is often dressed up with the promise of perks such as money-off discounts, but what many people miss is the fact they’re potentially locked into the investment for a long time and might be in the dark as to what’s going on.”

In the case of BrewDog, Coatsworth highlighted that it only had occasional ‘trading days’ where crowdfunding investors could sell their shares outside formal fundraisings.

The last time this happened was 31 August 2022, which meant any investor seeing signs of trouble in the business in recent years couldn’t do anything about it unless they found a willing buyer for their stock privately.

Here are some alternative ways to invest in small companies and startups.

Equities

Crowdfunding emerged over the past decade as an alternative to the traditional ways of putting money into companies.

It let unlisted firms raise funds directly from the public, arguably giving consumers access to the world of investing that they may have previously felt shut out of.

Crowdfunding investors are supposed to be asked if they understand the risks of losing everything and it can be a lot harder to sell out and get your money back compared with putting money into equities.

Plus, you could earn profits from equities tax-free from a stocks and shares ISA.

Coatsworth added: “Investing in companies on the stock market means there is a clearer exit path. You can sell to another investor during stock market hours, although there is no guarantee there’s always a willing buyer and/or someone prepared to pay what you want.

“Crowdfunding is very different to retail investing on the stock market. With crowdfunding, there is less transparency into a company’s accounts and often little insight into its latest trading strength or weakness. That compares to companies on the stock market who have an obligation to publish accounts every six months, and many will provide trading updates once a quarter.

BrewDog going into administration before its takeover by Tilray means its ‘Equity for Punks’ crowdfunding investors have lost everything.

While the same would apply to a company on the stock market going into administration, Coatsworth highlights that investors in quoted companies might have had a chance to cut some of their losses if they bailed out following warning signs, “rather than have their hands tied and then lose everything.”

Investors could also back qualifying Alternative Investment Market shares, which currently get 100% relief from inheritance tax after two years, dropping to 50% from April 2026 with a rate of 20% on the remaining value.

Investing in Venture Capital Trusts

Unlike crowdfunding, investing through venture capital trusts (VCTs), enterprise investment schemes (EIS) and seed enterprise investment schemes (SEIS) have routes that let investors offset losses.

Investors who back VCTs, which invest in UK scale-ups, can benefit from upfront tax relief of 30%. The incentive reduces to 20% from April. All returns are tax free.

The 30% income tax relief rate will stay for EIS .

The Seed Enterprise Investment Scheme (SEIS), which invests in smaller start-ups, is an even bigger winner when it comes to tax savings. You receive up to 50% income tax relief when you invest and can also wipeout half your capital gains tax (CGT) bill from the sale of other investments.

Any gains you make in EIS and SEIS are CGT free and if it goes wrong you can also write off losses against your income tax bill in the same tax year.

Susannah Streeter, chief investment strategist at Wealth Club, said: “Such tax reliefs are aimed at compensating experienced investors for the risk they take in investing in small, high-growth companies.

“It’s vital that growing companies can access such streams of funding to give them the opportunity to thrive and help boost the UK economy. But there’s recognition that many fledgling companies will struggle, and by investing in a fund which backs numerous ventures, the risk is spread, given the likelihood that there will be some successes in the pack.”

Thousands more estates will be hit with a double inheritance tax (IHT) blow within two years – but there are ways you can lower the bill for your loved ones.

The number of estates worth more than £2 million which will start to lose their residence nil-rate band is set to rise by 76% from 3,620 in 2023 to 6,400 by 2028, according to new research by wealth management firm Quilter.

This figure will increase to over 16,000 by 2031 due to frozen IHT thresholds and pensions being subject to IHT from April 2027. Rising house prices will also increase the value of peoples' estates.

IHT is usually payable on estates worth £325,000 or more but this is topped up by an additional £175,000, known as the residence nil-rate band, if you are leaving your home to a child or grandchild. You can pass this £175,000 allowance to a partner if you die.

This means couples who are married or in a civil partnership could leave up to £1 million to loved ones and they wouldn’t owe any IHT.

However, for every £2 your estate is worth more than £2 million, you lose £1 of this residence nil-rate band until it disappears. This means estates left by a single person worth £2.35 million receive no residence nil-rate band, while for couples it’s £2.7 million.

With IHT tax bands frozen at their current levels until 2031 and pensions falling into the scope of IHT from April 2027, more estates will start losing this allowance, Quilter said.

Shaun Moore, tax and financial planning expert at Quilter, said: “Many estates are likely to be hit by the double whammy of pensions being brought into scope for IHT and frozen tax allowances.

“IHT is already a devilishly complicated tax to navigate, and given the rise of asset prices in the past decade or so, many more are having to adapt their strategies in real time to help mitigate it and pass on wealth efficiently to future generations.”

How to reduce your estate to less than £2 million

If you believe you could be set to lose some or all of your residence nil-rate band, because your estate is likely worth more than £2 million, you might want to plan ahead now to protect your wealth.

1. Gifting

You can give up to £3,000 away each tax year without it being added to the value of your estate as well as up to £5,000 to someone getting married or entering into a civil partnership.

Gifts worth up to £250 can be given to as many people as you like each tax year, so if you have eight grandchildren, you could give them £250 each and remove £2,000 from your estate.

However, you can’t use this allowance if you’ve used another allowance on that person. So, you wouldn’t be able to pay someone a £250 gift and another £3,000 gift in one tax year and benefit from both the small gift and annual allowances.

You can also give an unlimited amount of money away and your estate won’t be subject to IHT if you live for seven years after giving it.

Moore said: “Lifetime gifting remains one of the most reliable ways to bring an estate back below the threshold.”

Do note, it’s important to keep records of when and how much you’ve gifted as this will make it easier for your executors to disclose any to HMRC.

2. Charitable giving

Donations to charity left in your will are taken off the value of your estate before IHT is calculated.

If 10% or more of your estate is donated to charity, your overall IHT rate will fall to 36% rather than the standard 40%.

3. Downsizing

You can move to a less valuable home and release some of the equity tied up in your current property to lower the value of your estate.

You will have to give away or spend this equity to actually reduce the size of your estate though and note the seven year rule may apply if you’re giving away money outside of your allowances.

There are also the costs associated with moving home such as estate agent fees, surveys and paying removal firms to factor in.

Rebecca William, financial planning divisional lead at wealth manager Rathbones, said: “Options such as downsizing later in life can help, provided people understand what they can afford to give away and when.”

4. Remove pension wealth earlier

With pensions subject to IHT from April 2027, you may want to start drawing down on your pension or take your tax-free lump sum earlier than planned to release funds from your estate.

Just make sure you’ve got a plan in place so it doesn’t leave you out of pocket down the line in retirement.

Tax-free lump sums can’t be added back into your pension once they’ve been taken out as well, so bear that in mind if you’re planning on withdrawing yours early.

5. Onshore bonds

Onshore bonds written in trust can be an effective way of reducing your future IHT liability if gifted to a family member.

As long as the giver survives seven years, there will be no IHT to pay.

Criticism of student loans is on the rise as graduates complain that the debt is making it harder for them to get mortgages and to save for other milestones.

It comes after Money Saving Expert’s Martin Lewis recently clashed with Conservative Party leader Kemi Badenoch over the focus of student loan reforms.

Lewis claims that the frozen repayment threshold is the issue while Badenoch has called for changes to the amount of interest paid.

Chancellor Rachel Reeves is rumoured to be planning to make changes in her Spring Statement to make the student loans system fairer.

But it raises the question of whether it is fair to encourage students to go to university and potentially lumber them with unmanageable debt in the future.

Many complain that the repayments make it hard to save for a mortgage deposit or other financial aims. Additionally, mortgage lenders may consider student debt levels in affordability calculations.

An alternative is for wealthy parents to fund their child’s education instead.

So how do you decide whether to support your child financially through university or are they better off getting a student loan?

The trouble with student loans

As most parents with university age children will know, further education is expensive.

Tuition fees can cost up to £9,000 per year and that’s before you add the money needed for books, food and rent.

There are tuition fee student loans available and also funding for living expenses known as maintenance loans.

These are available to all households, although the size of maintenance loan depends on your household income and where the student is living.

Government data suggests the average graduate leaves university with debts of £53,000.

On paper it looks like a good deal. The money doesn’t have to be repaid until the April after a child graduates and only once they earn above a certain threshold. The interest rate is 9% of anything above the threshold.

But graduates are being hit with fiscal drag as the thresholds have been frozen.

Critics say this particularly affects those on Plan 2 loans who were at university between 2012 and 2022.

The repayment threshold for those on Plan 2 loans is set to rise from £28,470 per year to £29,385 this April, but will then be frozen at that level until 2030.

Should parents cover their child's university costs?

University will be many young people’s first taste of financial freedom, giving them the chance to learn how to budget and to manage their own finances.

So there is an argument for letting them take out a student loan to manage their own money.

But, if you can afford it, should you support your child and help them avoid building up student debt?

Products such as a Junior ISA could help give them a nest egg to put towards university or you could even purchase a student property to rent out.

Samuel Mather-Holgate, managing director at Mather and Murray Financial, said: “If you’re lucky enough to be able to fund your child’s university education, this is the way to go.

“Allowing them to take student finance is committing them to an effective graduate tax for life. Unless they will earn over £80,000 per year, they are unlikely to ever pay it off. You have to earn over £65,000 to chip away at any capital given the current interest rates. It’s a system that needs addressing or will become a brake on university admissions.”

It is worth considering what your child’s future career aspirations are though, as some may never earn enough to need to pay back the loan.

Dariusz Karpowicz, director at Doncaster-based Albion Financial Advice, said: “High earners often repay far more than they borrowed once interest builds up, so paying fees upfront can save tens of thousands.

“Lower earners may never clear it anyway, making it behave more like a capped contribution. Think careers first, interest rate headlines second.”

The best solution may be a balance between helping with some aspects such as living costs and letting them borrow the rest if needed. But it is important to ensure that any support doesn’t hamper your own financial goals such as pension saving.

Nouran Moustafa, practice principal at Roxton Wealth, said: “Funding university outright is wonderful if it fits within the family’s wider financial plan. But it should never come at the expense of parents’ retirement security or overall stability.

“What matters most is education. A student loan without understanding becomes a silent drag on future finances. With awareness and planning, it becomes simply another structural part of someone’s financial life.

"The decision shouldn’t be driven by fear of interest headlines it should be driven by a long term vision.”

Savings accounts have battled their way back onto Brits’ radar, offering attractive rates to beat the Bank of England’s base rate and inflation. But when it comes to getting more bang for your buck, they have some stiff competition from tax-efficient pensions, for those who already hold an emergency savings pot.

Inflation is slowing, with the latest data for January putting CPI inflation at 3%. Consequently, the Bank of England is gradually reducing the base interest rate – it is currently 3.75%, with the next BoE decision due on 19 March.

The best cash savings account rates are currently around 4.5%, and many households feel they are finally being rewarded for holding cash.

However, for higher- and additional rate taxpayers, a significant portion of those gains can disappear once tax and inflation are factored in, according to new analysis from Standard Life.

Even at inflation-beating best buy rates, higher rate taxpayers could lose over two-thirds of their savings gains to HMRC and the creeping increase in the cost of living, the number crunching found.

Mike Ambery, retirement savings director at Standard Life, said: “Higher interest rates can lull people into thinking their cash is working harder than it really is.

“Frozen income tax thresholds are pushing more people into higher income tax brackets each year and the amount of interest lost to tax could come as quite a surprise, especially with inflation to consider too.”

Bear in mind, in this article we are assuming you already have a healthy emergency savings buffer of between three and six months outgoings, which is what the experts recommend.

The impact of tax on savings

Many savers make use of ISAs to keep all of the gains they make from savings interest. But those who have already used the full £20,000 annual ISA limit and are now holding cash in taxable savings accounts, may face a much larger bill than expected due to the savings tax trap.

With income tax bands frozen until 2031, more people are moving into higher and additional rate brackets each year – in what’s known as fiscal drag – making tax on interest a growing issue for households who may not realise they’re affected.

Once your savings interest exceeds tax-free allowances, it is taxed at your marginal income tax rate, so 20% for basic rate taxpayers, 40% for those in the higher band and 45% for additional rate taxpayers. From April 2027, this jumps to 22%, 42% and 47% respectively.

Higher rate taxpayers only need around £11,000 in a non-ISA cash account earning 4.5% interest before their £500 personal savings allowance (PSA) – the amount of savings interest they can earn tax-free – is used up and interest begins to be taxed. Even before inflation is considered, this reduces returns significantly.

For higher rate taxpayers with larger amounts held outside an ISA in taxable accounts, the benefits of even the best buy cash savings rates are eroded away further by tax and inflation.

For a higher rate taxpayer holding £30,000 in a taxable savings account, for example:

• £1,350 interest is earned at a 4.5% rate
• After the personal savings allowance is used up and tax applied, this falls to £1,010
• After allowing for 2% inflation, the real gain is just £402

Basic rate taxpayers, who have a bigger £1,000 personal savings allowance, need around £22,000 in a top rate savings account to incur a tax bill. By comparison, additional rate taxpayers pay tax from the very first £1 of interest because they have no PSA at all.

The impact of tax relief on pensions

On a purely numbers basis, when measuring the gains on savings accounts next to pensions, there is really no competition – although you must be willing to lock your money away for a long time.

Pension contributions are one of the most tax-efficient ways to save, for those able to take a longer-term view with their money.

Higher and additional rate taxpayers, in particular, benefit from higher tax relief, giving their contributions a significant immediate boost.

For example, the same £30,000 invested into a pension could lead to a gain after one year of £21,103, according to Standard Life analysis, assuming 5% annual investment growth, 40% tax relief on the whole £30,000 and allowing for 2% inflation.

This is more than 52 times greater than the returns on a taxable cash account, and without any immediate income tax bill.

Pensions are usually taxed as income as they are withdrawn, beyond the 25% tax-free lump sum.

Source: Standard Life. Inflation calculated on the value after tax on interest and charges for taxable cash account and ISA, and after tax relief, investment growth and charges on the pension. Up to £20,000 each year can be deposited in an ISA.

Ambery, from Standard Life, said: “While ISAs are a solid tax‑efficient option, pensions are where the tax system truly works in your favour. For a higher‑rate taxpayer, a qualifying £30,000 contribution can instantly become £50,000 through tax relief. If you’re planning for the long-term, that head start is incredibly difficult for cash savings to compete with.”

Pensions vs savings: Which is best for my money?

The quick answer is a pension will give you a much higher return on your money than even large sums in some of the best paying savings accounts – although you won’t have access to it in the short-term. But the real answer is, if you can, have both.

A savings account might work better for you if you need access to your cash quickly, for example if it is where you keep your emergency fund. By comparison, pensions are savings for the long term, so you’ll need to be willing and able to tie your money up until at least age 55 (rising soon to 57) before you reap the benefit.

High net worth and experienced investors looking for tax breaks and keen to do more than just add to their ISA or pension will want to have a keen eye on weeks leading up to the end of the 2025/26 tax year.

Certain government-backed initiatives – namely Enterprise Investment Schemes (EIS), Seed Enterprise Investment Schemes (SEIS), and venture capital trusts (VCTs) – have use-it-or-lose-it allowances interested investors will need to act fast to take advantage of, well in advance of the official end of the current tax year on 5 April.

EIS, SEIS and VCTs are designed to encourage investment in early stage companies using the carrot of income tax savings. These are also much riskier products, suitable only for high net worth individuals who can afford to lose out if the companies fold (as young companies are more likely to do) and experienced investors who understand those risks.

With that in mind, for interested investors the deadline for submitting applications to invest in EIS, SEIS and VCTs is much sooner than 5 April. Also changes to the tax incentives for VCTs from April mean that investors need to act now to benefit.

Susannah Streeter, chief investment strategist at Wealth Club said: "High net worth investors with multiple sources of income, or complex tax arrangements, often find that planning for the end of tax year deadlines is a headache – and this year it risks becoming a migraine.

“There were yet more tweaks to taxes at the 2025 Budget, making affairs even more complicated at a time when tax rates remain at the highest levels in peacetime. So, investors wanting to reduce their tax bills should act now rather than leaving everything to the last minute.”

End of tax year checklist for experienced investors

Up to six weeks before end of tax year

VCT investors will find that, while the deadlines to invest span the last two weeks of the tax year – with some VCTs using the earliest deadline to invest on 23 March and with the last to close its books at noon on 2 April – the real deadlines will be earlier.

This is down to offer capacity, meaning the maximum amount of money a specific VCT is looking to raise from investors during a new share offer. The most popular VCT offers are likely to be fully subscribed before their deadlines are met and are already nearing capacity, according to Streeter. For example:

• Albion VCTs (87% full)
• Northern VCTs (94% full)
• Molten Ventures VCT (93% full)

“With VCT income tax relief due to drop to 20% from 2026/27, investors whose shares are allotted in the current tax year can still benefit from 30% income tax relief. This means there is a real incentive to do a VCT now rather than waiting till the next tax year,” said Streeter.

You can invest up to £200,000 per tax year into a VCT.

Five weeks before end of tax year

Investors seeking to invest in SEIS funds have only have until 27 February to invest in funds deploying capital in the 2025/26 tax year, including, for example:

• Fuel Ventures SEIS Fund (27 Feb)
• SFC Angel Fund SEIS (27 Feb)

“That said, investors whose funds are deployed in 2026/27 may still use the ‘carry back’ option to apply their SEIS income tax relief to 2025/26,” Streeter pointed out.

Carry back allows investors to treat shares acquired in the current tax year as if they were bought in the previous tax year. This enables you to claim income tax relief against the previous year’s tax bill.

When you invest via SEIS you receive up to 50% income tax relief. You can invest up to £200,000 into SEIS each tax year.

Two weeks before end of tax year

“Investors in EIS funds will find some have already closed for the 2025/26 tax year, but there are a few remaining open with the latest deadline on 27 March,” said Streeter. These include:

• Fuel Ventures Follow-on EIS Fund (27 Mar)
• Guinness EIS (6 Mar)
• Haatch EIS Fund (6 Mar)

Like SEIS investors, EIS investors whose funds are deployed in 2026/27 may still use the ‘carry back’ option to apply their EIS income tax relief to 2025/26.

When you invest in EIS you receive income tax relief of up to 30%. You can invest up to £1 million a year or £2 million if the company is “knowledge intensive”.

One week before end of tax year

Investors in Knowledge Intensive EIS funds will find that the deadlines range from 30 March up to 3 April at noon. These funds, from managers including Parkwalk and Molten Ventures, provide investors with a single EIS certificate dated in 2025/26 once they have deployed 90% of their capital.

Deadlines in the last week

ISAs

If the higher risk EIS, SEIS and VCTs are not for you, you can still put up to £20,000 in ISAs this tax year right up until a minute before midnight and all income, interest or capital gains are tax-free. “You can also add up to £9,000 into a Junior ISA up to 11.30pm with providers by debit card, but if completing a bank transfer this needs to be done by 11.59pm on 4th April,” said Streeter.

Pensions

The annual allowance for adding money in your self-invested personal pension (SIPP) is £60,000 although that amount is restricted to as little as £10,000 for high earners. Investors can add up to this amount, or the up to their annual income each year, whichever is the lower. “Some providers will take payments by debit cards into pensions up to 30 minutes before midnight on 5 April but bank transfers may be limited to before 12pm (noon) on that day,” Streeter said.

Frozen tax thresholds have increased the number of Brits paying income tax at the same time as squeezing the tax-free allowances that let people make an income without paying a penny to HMRC. But the tax system can still be made to work to your advantage, if you know how to play it.

An estimated 39.1 million people now pay income tax, according to HMRC data. This is an increase of 6.1 million from when income tax thresholds were frozen in the 2021/22 tax year, almost four years ago – an effect known as fiscal drag.

Basic rate taxpayers account for the vast majority, an estimated 30.4 million people, which is a rise of around 3 million since the freeze.

Higher rate taxpayers are up by 2.65 million to 7.08 million, and additional rate taxpayers make up 1.23 million of the total, an increase of 710,000.

Thanks to the state pension triple lock – which has seen the state pension increase every year since 2011 by inflation, average earnings or 2.5%, whichever is higher – 8.7m taxpayers are over state pension age, up 29% since the freeze.

Income tax thresholds will remain frozen until April 2031. Originally set to end in 2028, the freeze was extended by the government in the 2025 Autumn Budget to raise funds. Good news for the Treasury, not so good for personal incomes.

Yet there are still a few ways to legally generate an income free of tax, if you are willing to be flexible about where that income comes from.

Helen Morrissey, head of retirement analysis at Hargreaves Lansdown, said: “Between us, we’re paying billions more in tax than we did this time last year, and it’s only going to get worse, because those tax thresholds have been frozen until April 2031.

“It means the idea of generating a tax-free income has become even more attractive. Fortunately, there are a number of allowances and rules which mean you can take steps to protect yourself from a horrible tax bill.”

How to generate tax-free income every year

1. Keep up to £12,570

The personal allowance – the first £12,570 of taxable income per person per year – is tax-free. If you earn less than this, you won’t pay a penny of income tax.

The personal allowance is reduced by £1 for every £2 of taxable income above £100,000, which is why earnings between £100,000 and £125,140 are taxed at an effective 60% tax rate.

That’s one reason why people who make more than £100,000 may consider making additional pension contributions to cut their taxable income and so keep more of their personal allowance.

2. Rent a room to a lodger and keep up to £7,500

If you rent a furnished room in your home to a lodger, the first £7,500 of rent each year is tax-free under the rent-a-room scheme. This limit hasn’t risen for a decade, however, and if you go over it you’ll need to file a self-assessment tax return.

3. Rent out land or property for up to £1,000

This could be from a property business, but it doesn’t count for renting out a room in your own property that falls under the rent-a-room scheme.

4. Side hustle earnings are tax-free up to £1,000

If you make a modest income from a side hustle or hobby, such as selling items you have made on Ebay, Etsy or Vinted, you can keep what you make without paying income tax up to £1,000. This is known as the ‘trading allowance’. Cash from getting rid of your old belongings isn’t likely to be taxable unless any individual item is worth more than £6,000. You can check if your additional income is taxable using HMRC’s tool.

5. Make your savings work hard and keep up to £1,000

Stick your cash in some of the best regular savings accounts or accounts with the best savings rates for lump sums and don’t worry about paying tax on the interest up to £1,000 if you’re a basic rate taxpayer and up to £500 for higher rate taxpayers. Additional rate taxpayers don’t have a personal savings allowance.

6. Low earners get an extra savings boost

If you don’t earn much but have a healthy amount in savings you could be entitled to an extra tax-free income. Earn less than the personal allowance of £12,570 from wages and pensions, and you get the starting rate for savings. This means the first £5,000 of interest on your savings is tax-free. You also get the full £1,000 personal savings allowance on top of that.

So in total you can make up to £12,570 from wages, and £6,000 in savings interest without paying any tax. However, for every £1 of non-savings income over your personal allowance, you lose £1 of your starting savings allowance, so if you earn £17,570 you lose the entire allowance altogether.

7. Premium Bond prizes are tax-free

Whether it’s £25 or £1 million, Premium Bond prizes are tax-free.

8. Keep all the interest on savings in a cash ISA

Savers can put up to £20,000 into a cash ISA in the current tax year and interest is completely tax-free. The allowance remains the same in the coming tax year, before dropping to £12,000 for people under the age of 65. And all withdrawals are tax-free. Be sure to shop around to get the best cash ISA for you.

9. Income from stocks and shares ISAs yours to keep

All income your investments make inside a stocks and shares ISA – bond income or dividend income, for example – is free of any tax. You can also withdraw all the money without paying tax on it. When you reach the life stage where you want to draw an income from your assets, having ISAs in the mix alongside taxed income, like pensions, can really keep your tax bill down.

10. Income withdrawn from a Lifetime ISA at age 60 or over is tax-free

Any money withdrawn from a Lifetime ISA (LISA) is tax-free – as long as you stick to the rules. The LISA is dual purpose; it can be used to build a deposit to buy a first home (in which case the cash will go straight into that at the point of purchase) or save for retirement, with access from age 60. With the retirement option, all withdrawals are tax-free, giving you another tax-friendly income stream. But take the money out under any other circumstances and you’ll pay a penalty.

11. Enjoy your £500 dividend allowance

If you have investments outside an ISA, the first £500 of dividend income is free of tax in the current tax year. This allowance has dropped dramatically since being introduced in 2016 and dividend tax rates have increased during that time too, making ISAs even more valuable for those using dividends to boost their income.

12. Make use of double couple allowances

There are financial benefits to being married. You can share assets between you and double the amount of money you can make before the taxman takes a slice. For example, you can share income-producing assets with your spouse, so you can both take advantage of your personal allowance, dividend allowance and ISA allowance. Or in the case of capital gains tax, if you sell an asset that you hold jointly, you can effectively double the potential tax-free gain you make on it.

13. Purchased life annuities can generate a tax-free income too

These are designed to provide a guaranteed income for life or over a fixed term, in exchange for a lump sum that’s not from a pension. Part of the income paid is deemed to be a return of your original investment and therefore is tax-free. The interest element of the income is taxable, but no tax will have to be paid if it falls within the personal allowance or personal savings allowance.

If you’re worried having several pensions scattered across multiple providers could mean you lose track of them, or cost you more in fees, you may want to consider consolidating your retirement pots.

But what is pension consolidation, and should you do it?

Pension consolidation just means bringing together multiple defined contribution pensions (there are different rules for defined benefit pensions) into one single pot with one single pension provider. This can be done in one of two ways: moving your other pots into one pension you already have; or moving all your pots into a new pension with a new pension provider.

Pensions are a standard work perk in Britain today – usually with every new employment comes a new workplace pension into which staff are automatically enrolled. Older workers who have been in the workforce for decades can have half a dozen pensions floating around.

Having a large number of pensions can mean doubling or tripling up on admin and costs, and mean you lose sight of investment performance. Pension consolidation is a potential solution – but it’s not right for everyone.

Why would I consolidate my pensions?

Savers considering pension consolidation are typically looking for a solution to a couple of problems:

1. They have too many pensions to comfortably keep track of. Some may even be ‘lost’.
2. They are paying unnecessary fees to pension providers because they have multiple pots all doing similar things (like being in similar default funds) but paid for separately.

Maike Currie, vice president of personal finance at PensionBee, a firm which provides pension consolidation services, said: “One of the strongest arguments for consolidation is the prevention of ‘lost’ pensions. Although it’s fair to say that often pensions aren’t necessarily ‘lost’, they’re simply scattered and often ignored.”

At least 4.8 million pension pots are currently considered ‘lost’ in the UK, according to research by PensionBee, with nearly one in 10 workers believing they have misplaced a pot worth more than £10,000.

That fragmentation can make it hard to keep track of how much you’ve saved, how your investments are performing and how much you are paying for that performance.

“Consolidation brings those pots together into one place, giving you a much clearer picture of how much you’ve saved and making it easier to engage with your retirement plans. It also helps reduce the risk of pensions genuinely being forgotten altogether,” said Currie.

Pros and cons of consolidating pensions

Here’s a quick run down of the main benefits and risks of consolidating your pensions from pension consultancy LCP.

Pros

1) Lower charges – many pensions taken out before automatic enrolment will have much higher charges, whereas under auto-enrolment the fees for modern workplace pensions are capped at 0.75% or less.

2) Better value when buying an annuity – one big pension pot can buy a better value annuity than lots of smaller pots

3) Rationalising your investment strategy – with scattered pots, it is almost impossible to be clear how your money is invested and to ensure you have the right level of risk and return for your individual situation.

4) Easier to manage the pension paperwork – this will become more important once unused pensions are included in inheritance tax calculations from April 2027

5) Benefiting from the latest investment innovations – many old pots may be invested with a UK bias or may not take advantage of asset classes which have become more mainstream in recent years.

Cons

1) Giving up valuable product features of old pensions, including ‘guaranteed annuity rates’ (GARs), which promise an often attractive annuity rate compared with current market rates – a feature which may be lost on transfer.

2) Lack of diversification of pension provider and potentially fund manager

3) Giving up ‘small pot privileges’ such as the ability to access pots under £10,000 without triggering the ‘money purchase annual allowance’ – a tight limit on tax-relieved future pension saving.

4) Giving up on other ‘protected’ features of your old pension, such as higher rates of tax-free cash (on older pension policies) and the ability to access it before the proposed normal minimum pension age of 55 (rising to 57 by 2028). You should always seek professional financial advice should you feel any of your policies could contain these.

5) Risk of exit charges to leave your old pension. The cost of transferring varies between providers. Exit fees are capped if you are close to retirement, so in a lot of cases, the exit costs do go down with time and may not apply anymore to your policy.

Will consolidating my pensions save me fees?

While savings vary, consolidating your pensions can reduce duplicated charges. Over decades, even a small fee difference can translate into thousands of pounds more in retirement savings. Currie, from PensionBee, gave the following example:

Imagine someone has four separate pension pots worth £10,000 each (£40,000 in total). Each older scheme charges around 1% a year in fees. At 1%, they would pay about £400 a year in total charges. If they consolidated into a single lower-cost pension charging 0.5%, annual fees would fall to around £200 a year – a 50% saving.

Currie said: “Here’s the rub: Pensions are the ultimate long term investment where the power of compound interest really comes to the fore and the real impact of this saving will come from compounding over many years.”

For example, over 25 years, assuming 6% annual investment growth (in line with what the MSCI global index has returned over the long-term) staying in the four higher fee pots (£40,000 saved in each) could leave you with a total pension pot of about £135,500 by PensionBee’s calculations (a net return of 5% with 1% in fees deducted).

However, consolidating your pots into a lower-fee plan charging 0.5%, the net return will be 5.5% a year, which could result in £40,000 roughly turning into a total of £152,400.

“That’s a difference of around £15,000 over 25 years, simply from lower charges – without contributing an extra penny,” Currie explained.

Also, with some pension schemes, when the fund value of the pension goes above a certain amount, you receive a discount on your whole pension, which you may not qualify for if you spread the contributions across different providers.

How will consolidating my pensions affect my investments?

One of the main misconceptions about transferring all your pensions into one is that you will reduce your investment diversity, which is not necessarily true.

If you look at and compare all of your pensions you might find they’re not diversified at all currently, because they’ve stayed in the ‘default’ funds offered by each provider and these are often very similar – for example, they might be all UK funds.

By comparison, if you find a new provider with a good selection of funds, you can have a range of investments all held within the same pension plan.

Also when pensions are consolidated into one, monitoring investment performance can be much simpler. Pension providers tend to report past performance in different ways and times – one may come at the beginning of the year, another in the middle and the other at the end. If you have one pension, you know every time where you stand and how it is performing.

Another investment issue to consider is whether your current policies are still right for your risk profile and risk tolerance, which can change over time. If your pensions are all in one place, it can help you to more clearly see if the underlying investment strategy is still suitable for you.

This is crucial to review at least every three years, and you may now find that your old pensions are invested in portfolios that are now too low or high risk for you.

Different pension providers offer different strategies – some might have 10 options while others might have many more to choose from. It’s about understanding what the right investment option for you is and then consolidating your pension savings into the right strategy.

Flexible pension options

You may want to transfer your pensions in order to give yourself greater choice and flexibility with your retirement savings. Some pension schemes which were established before 2015 (prior to the pension freedoms rules) may not have the flexible options that other newer pensions have.

Income drawdown (also known as flexi-access drawdown) came into effect in 2015 and it allows you to access your pension savings whenever you need to from age 55, while reinvesting your remaining funds in a way that is designed to provide an ongoing retirement income.

If you retain an older pension, when the time comes for you to access it, you might have to transfer it anyway to another one in order to receive the benefits you are looking for, like flexi-access.

Pension consolidation and retirement goals

As you’ll only receive statements for one plan, record keeping becomes much easier. This is particularly useful if you want to make a large, one-off contribution and to make use of your pension carry forward allowance to mop up any unused allowances from the previous three years.

It can end up being quite a mammoth task if you have a multitude of pensions that you’ve been contributing to, because you have to contact each provider for information and, basically, you’ll be held back by the slowest one of them.

Finally, consolidating your pensions into one policy, where appropriate, and even just beginning this exercise of reviewing each of them, will enable you to have a far clearer picture and understanding of what you have built up so far, what you may need to continue to save and all your income options in retirement.

Camilla Esmund, senior manager for consumer campaigns, financial education and retail investment analysis at Interactive Investor, said: “Having everything in one place makes it easier to know where you stand, if you're saving enough, and whether you're on track for the retirement you want.”

You may even find you can retire earlier than you thought.

Is pension consolidation right for me?

The main aspect to consider during the review of your pensions and any before consolidation is what might be lost – as this can outweigh what you gain in lower fees and simplification.

Some older pension policies could have valuable guarantees, such as a guaranteed minimum pension or protected higher tax-free cash percentages. These could be lost on transfer.

If your old pensions don’t have any of these guarantees, however, consolidation could be right for you as a way to keep track of your retirement pot, keep costs down and flexible options open.

Currie from PensionBee said: “Consolidating pensions can be a powerful way to simplify your financial life – giving you a sense of control and clarity. Bringing scattered pots into one place makes it easier to see how much you’ve saved, and how your underlying investments are performing. It can also potentially reduce duplicated fees so more of your money stays invested.

“Of course it isn’t a one-size-fits-all solution. Some older schemes come with valuable guarantees that could be lost on transfer, and defined benefit pensions in particular often offer benefits that are hard to replicate elsewhere. The key is always to weigh up convenience and cost savings against what you might be giving up.”

As always, it is best to seek professional financial advice to understand all your options before making any large financial decisions.

A care fees annuity, also known as an immediate needs annuity, is a type of insurance policy to pay for care costs. In exchange for a one off lump sum from the person who needs care, or their family, the care fees annuity pays out a regular monthly amount to cover the cost of providing that care.

Care costs can be much higher than expected – most of us are wildly out when it comes to estimates of just how expensive. As many as 85% of those who had previously helped find care for a loved one were shocked at the cost, according to research for the Just Group Care Report 2025.

More than half (60%) of over 45s quizzed in the Just survey thought the cost of a year’s residential care was less than £60,000, significantly lower than industry estimates for self-funders of £66,456.

Worryingly, more than three in 10 (31%) expected the cost would only be up to £30,000 a year, less than half the true figure.

With an estimated four in five people aged 65 and over likely to require some level of care before they die, according to the 2025 House of Commons Committee Report on Adult Social Care Reform, millions of families are sleepwalking towards a nasty shock.

Care fees annuities are one potential answer to the problem of paying for care, though they come with their own costs. We weigh up the benefits and risks.

What is a care annuity?

Care annuities, sometimes called ‘care plans’ or ‘immediate needs annuities’, are a type of insurance policies to pay for care costs, either at home or in residential care.

Mel Kenny, chartered financial planner at Radcliffe & Newlands Wealth and an adviser accredited with the Society of Later Life Advisers (SOLLA), explained: “In exchange for a lump sum, an insurer provides a guaranteed income for the rest of the care resident’s life. Care annuities can also help pay for home care.”

The size of the lump sum required to buy a care annuity is based on individual circumstances, closely linked to the person’s current health and wellbeing and how long they might be expected to live.

Payments made from a care fees annuity are exempt from income tax when paid to a UK registered care provider, either a care home or for care provided at home. This compares to payments from a regular annuity, which are taxable.

They also differ from a regular pension annuity because care fees annuities are not bought using money held within a pension, they are bought using the customer’s own money – savings, investments, or proceeds of a house sale, for example. Though overall payment for care is often made through a mixture of pension income, state pension and other sources, including potentially a care annuity.

Are all care annuities the same?

Care annuities are not all the same, so you’ll need to consider carefully which type is best for you or your loved one.

With an immediate needs care annuity, the income is paid out beginning from the point the annuity is purchased. There is also a deferred care annuity option, where the premium is lower but the income begins at an agreed time in the future.

You can also choose a care annuity with certain protective features, perhaps best thought of as added insurance, though these tend to be more expensive.

For example, you can choose to protect up to 75% of the initial sum paid out. This means, the estate of the person for whom the care annuity has been bought will get 75% of the cost of the annuity, minus however much has already been paid out to cover care costs. So if the person for whom the annuity was bought dies earlier than expected, the cost of the annuity is not all lost.

There is also another feature, known as ‘escalation’ that can be factored into care annuities. This increases the amount paid out by the annuity over time, either by the Retail Price Index measure of inflation or by a fixed amount. This can be helpful to cover the cost of care homes where fees increase each year.

Both capital protection and escalation can make care annuities more costly – although care fees annuities tend to offer better rates of income than pension annuities as they are aimed at older customers in ill health, with the expectation being the annuity will pay out for fewer years.

What are the pros and cons of care annuities?

Pros

• You usually know the costs of long-term care will be met
• Lowers the risk of your estate being eroded by future care costs, so you know what assets you will be able to pass on
• You can make sure the income rises with inflation to cover increases in care costs
• If an individual lives a long life then they can provide great value for money
• Reduces an estate for inheritance tax
• Peace of mind that a regular income payment will be paid for the rest of your life to help towards their care costs

Cons

• Care annuities don’t guarantee to cover the full costs of care – if the cost of care exceeds the income from the plan you will be responsible for paying the difference
• Care costs will rise with inflation – unless you have a care annuity that also rises with inflation, these costs may not be covered by the care plan
• Once the care plan has been set up, it can’t be changed, cancelled or cashed in at any time after the first 30 days
• The total income payments from the care plan may be less than the purchase price, and may be considerably less if the person it was bought for dies shortly after the start of their plan
• If the income is paid directly to a registered care provider, the income is tax-free – if this tax treatment is changed by HMRC or the income is paid to a company or person (like a family member) other than a registered care provider, some of the income may be subject to tax
• Can only be taken out through a regulated qualified adviser so that’s an extra cost

How much does a care annuity cost?

The cost of a care annuity is very specific to the individual, based on their health and how long they might live – each policy is individually underwritten so there are no ‘standard’ rates.

But as a rough guide, the premium on an immediate needs annuity – the lump sum you or your loved one hands over to the annuity company – might be three to four times the annual income required. So if the income you need to pay for the care home is £40,000 a year – on top of, say £20,000 of state pension income and other pension income, for example – you could need to pay a lump sum to the annuity provider of £160,000.

Kenny said: “A financial adviser might be able to give an indication of how much a care annuity might cost, but ultimately it depends on how the underwriters at the various insurers assess the applicant’s life expectancy.”

One care annuity provider, Just, crunched some example numbers back in April 2025 as to what typical care annuity (immediate needs) premiums might be to provide £20,000 a year for different ages, with and without inflation-linking (‘escalation’) as an add-on feature.

(As a reminder, industry experts say a year’s residential care could cost around £66,000 – so this £20,000 would need to be topped up with other income like the state pension and other private pension income.)

Source: Just Group, April 2025 and Advice on Care

Who provides care annuities?

There are currently four providers of care annuities – Just, Aviva, Legal & General and National Friendly. British Friendly are about to enter the market, which can be taken as an indication of the increasing popularity of care annuities.

How do you get a care fees annuity?

Care annuities can only be taken out through financial advisers.

“This is because assessing the suitability of them for different care situations is paramount,” said Kenny. “A financial adviser who is accredited by the Society of Late Life Advisers is more likely to understand both this and the applicant’s wider needs,” he added.

Care annuities are what is known as ‘medically underwritten’. Kenny explained: “This means the lump sum required is based on an assessment of life expectancy, following the completion of an application form, a consultation with the care provider and perhaps the doctor.”

Medical reports – from the GP of the person the annuity is for and from the care home where they are resident, if they are a resident – will usually be requested by the annuity provider. A central company, Medicals Direct, usually handles this via the completion of a medical questionnaire.

Are care fees annuities worth it?

Care fees annuities can provide good value for money if the person for whom care is being provided lives long enough to recoup the premium. They can also give two-fold peace of mind; firstly that the person will not have to rely on state care alone, and secondly that not all of your assets, or a loved ones’ assets, will be eaten up in care costs.

Most self-funding care home residents can use the state pension and private pensions to meet some of their care costs but may need to top-up by accessing savings or investments, often boosted by the sale of a home.

So if, for example, £48,000 of guaranteed income is required each year to top up income from the state pension and private pensions, and this can be secured for a premium of say £200,000, then once this initial premium is paid, any remaining assets are protected against care costs and could be spent, invested or given away.

A care annuity can also be used as a way to reduce the size of a person’s estate by the amount used to buy the care annuity – and therefore reduce the inheritance tax bill their loved ones may have to pay.

However if a care annuity is taken out without capital protection and the person being cared for dies earlier than expected, that money is lost. Or if the care costs spiral, the income provided by the care annuity may not be enough to cover it.

A full and frank conversation with a qualified financial adviser – ideally one accredited with SOLLA – is essential to weigh up the potential costs and benefits of a care annuity.

Inheritance tax is the gift that keeps on giving to the chancellor but for families mourning loved ones it can be a complicated minefield to get right at an already difficult time, with an avalanche of paperwork to manage in a very tight deadline.

Record inheritance tax receipts are expected to rise even further, as frozen IHT thresholds and rising property prices bring more people into scope of paying inheritance tax.

Furthermore, new rules introduced by the government in the October 2024 Budget will see more farms and small businesses paying inheritance tax for the first time from this April. Plus, from April 2027, unused pensions will also be subject to inheritance tax.

Both these new developments increase the demands on personal representatives – those in charge of administering the estate left behind after a death – to get the IHT paperwork right, or face potential fines.

Rebecca Minto, board director at the Association of Lifetime Lawyers, which specialises in later life and estate planning, said: “Inheritance tax paperwork is rarely straightforward, and the window for getting it wrong is surprisingly small: miss the six-month payment deadline and interest starts clocking up immediately.

“What we're seeing now is families who thought they had everything planned suddenly facing new questions,” she added. “Our advice is always the same; don't wait for a death to start thinking about this. The families who cope best are those where someone sat down with specialist professionals well in advance.”

Inheritance tax planning: what paperwork you need

Dealing with a loved one's estate is stressful enough without being caught off guard by the paperwork demands of inheritance tax. Whether a bill is due or not, families need to know what's required and with significant changes on the horizon for business assets and pensions, the stakes are rising.

Here's what you need to have in order:

1. Find out whether a full tax return is needed

Not every estate triggers a mountain of forms. If the estate qualifies as ‘excepted’, meaning no inheritance tax is due, the family simply completes the probate application and a short online declaration. This is common when the estate is modest or when everything is left to a spouse or charity.

An estate is usually excepted if:

• the gross value is £325,000 or less;
• it's worth up to £650,000 and a nil rate band is being transferred from a late spouse or civil partner;
• everything passes to a UK-domiciled spouse or UK charity and the estate is under £3 million;
• the deceased was permanently resident outside the UK with UK assets below £150,000.

“It’s worth checking before assuming the worst,” said Minto. HMRC has an inheritance tax checker tool you can use.

2. If inheritance tax is due, expect detailed paperwork

Where the estate doesn't qualify as ‘excepted’, personal representatives must complete HMRC's full Inheritance Tax Account (the IHT400). This is a comprehensive document covering:

• the deceased's family circumstances
• a full breakdown of assets and liabilities
• any lifetime gifts and settlements
• tax exemptions and tax reliefs claimed
• supporting valuations

Minto said: “Getting organised early – gathering bank statements, property valuations, and share certificates – will save considerable time and stress.”

3. What if no inheritance tax is due?

If no tax is due you still need to fill in form IHT205 at least. But even if no inheritance tax is due you could still be required to send full details of the value of the estate – within 12 months of the person dying – if the person who died:

• gave away over £250,000 in the seven years before they died
• gave gifts then continued to benefit from them in the seven years before they died
• left an estate worth more than £3 million
• was ‘deemed domiciled’ in the UK
• had foreign assets worth more than £100,000
• was living permanently outside the UK when they died but had previously lived in the UK
• had a life insurance policy that paid out to someone other than their spouse or civil partner and also had an annuity
• had increased the value of a lump sum from a personal pension to be paid after their death, while they were terminally ill or in poor health
• had agreed that property they’d given away during their lifetime would be part of their estate rather than pay a pre-owned asset charge.

4. Other forms you might need

Other forms you may need to complete as part of the inheritance tax process, according to solicitors at DLA Law are:

IHT402 – this should be submitted in conjunction with form IHT400 to claim the unused nil rate band from a late spouse or civil partner (to extend the inheritance tax threshold to £650,000).

IHT403 – to report gifts made during the deceased’s lifetime where they kept some benefit (e.g. continuing to live in a gifted property) or if the deceased made regular gifts out of income, to determine whether any extra inheritance tax is due

5. Don't miss the inheritance tax payment deadline

IHT is normally due six months after the end of the month in which the death occurred. Miss this and interest starts accruing automatically.

“The problem families can face is that the Grant of Probate, which unlocks the estate's assets, hasn't been issued yet. This is where planning ahead in terms of paperwork-gathering really pays off,” said Minto.

With a window of only a few months after the person’s death, try to locate as much documentation about pensions, property and insurance while your loved ones are still around to ask for details. Pension provider Royal London has a helpful ‘When I’m Gone’ document anyone can download and use to share helpful details with family and friends.

6. Sort paperwork for paying the inheritance tax bill

There are multiple potential options for paying an inheritance tax bill. Banks and financial institutions can pay HMRC directly before the Grant of Probate is issued using a form called the IHT423 – this Direct Payment Scheme is often the most straightforward route.

If the estate includes property, land, or qualifying business assets, the IHT on those assets can generally be spread across up to 10 annual instalments, though selling the asset usually makes the balance fall due immediately.

Where funds simply can't be accessed in time, HMRC can sometimes postpone payment via a ‘Grant on Credit’ arrangement, though interest continues to run up.

Personal representatives or beneficiaries can also advance funds personally and be reimbursed later, or a specialist probate bridging loan could be used to cover the liability while the estate is administered.

“It's also worth taking legal advice on whether a post-death variation of the estate could reduce the bill in whole or in part,” Minto said. This ‘deed of variation’ allows beneficiaries to legally alter a will or the rules of intestacy within two years of a death, often to reduce IHT.

7. Consider life insurance written in trust

Business owners and farmers in particular, may wish to consider this bit of paperwork sooner rather than later, said Minto.

A life insurance policy written in trust sits outside the estate, meaning the proceeds are accessible quickly and without probate – providing ready cash to meet a tax bill without having to sell or borrow against illiquid assets.

“For those in reasonable health where premiums aren't prohibitive, it's one of the most practical tools available,” Minto said.

8. Understand changes to business and agricultural relief from April 2026

From 6 April 2026, the 100% business property relief (BPR) and agricultural property relief (APR) will only apply up to a cumulative £2.5 million allowance per person. Business owners and farmers whose estates currently pass IHT-free may find a significant inheritance tax bill emerging overnight.

Where the estate includes company shares, a farm, or other qualifying assets all this paperwork will need to be gathered and valuations obtained. Where it is valued above the £2.5 million threshold, “families will need to think carefully about how to fund the excess – whether through dividends from the company, a share buy-back, borrowing, or an insurance policy”, said Minto.

“Each option has its own tax implications and commercial consequences, so specialist advice well in advance of April 2026 is essential,” she added.

The government’s guidance is that the majority of personal representatives claiming the BPR and APR will not face additional ongoing administrative burdens. For the estates which only hold shares that are not listed, there are no new obligations as the only change will be an update to the rate of the relief and there will be no change to how they interact with HMRC.

Where the estate now seeks to claim relief for assets in excess of £2.5 million, personal representatives will need to undertake an additional calculation at the reduced 50% rate. This will be reflected on updated IHT400 forms and guidance.

9. Remember pensions will be subject to inheritance tax from April 2027

Currently, pension funds sit outside the inheritance tax net. From April 2027, that changes. This will require pension schemes and personal representatives to share detailed information with one another. The exact processes for doing this are still under consultation. However it is expected to follow this pattern:

• personal representatives will have to inform pension schemes of a member’s death
• the pension scheme will then need to share details of unused pension funds and death benefits
• personal representatives will have to calculate and share how much inheritance tax nil-rate band is apportioned to the relevant pension
• pension schemes will be required to use this information to calculate the amount of inheritance tax due on the unused pension funds and death benefits, and to report and pay this to HMRC

Other variations of this are under consideration. The practical reality, though, is that this is a genuinely complex area.

Minto said: “Personal representatives and pension scheme administrators will need to share information and coordinate carefully, and delays in doing so could lead to late payment interest. Families with substantial pension pots should be reviewing their planning now.”

Organising care for a loved one in later-life can be a heart-wrenching and complicated process made easier by a professional financial adviser – but are the costs worth it?

Just 11% of over 45s who have helped organise care for an elderly relative had support from a financial adviser, according to new research.

But 66% of those who had been through the process of arranging care said they would have been grateful for a referral to an adviser to guide them.

Overall of the 2,500 people surveyed, a majority (59%) said they would like the option of being referred to an adviser by their local council, retirement specialist Just Group found.

Mitch Miller, senior care product manager at Just Group, said: “Currently financial advisers are not front of mind when people start looking for support and guidance for their later-life care planning but our research shows that, when prompted, most people are open to professional help to discuss their options.”

It comes as the UK’s population ages rapidly, with over 65s projected to make up a quarter of the population by 2050 by Office of National Statistics (ONS) estimates. Over 100,000 people will reach retirement age in 2026 alone too, according to analysis by charity Age UK of ONS population data.

With this in mind, many more people will be facing the challenge of arranging care for older loved ones in the years to come, and, if state support is not available, working out how to pay for that care.

Care costs can be significant. The average cost for a residential home in the UK is £600 a week, according to the NHS.

But while the research from Just Group suggests many in mid-life would be open to help from a financial adviser to take them through the process, are the associated costs always worth it?

When to use a financial adviser to organise care

1. Access to specialist products

One of the main advantages of using a financial adviser to organise care for an elderly relative is that it opens up products that are otherwise not available.

Lucie Spencer, financial planning partner at wealth manager Evelyn Partners, said one such product is an immediate needs annuity, also known as a care annuity, which pays out a guaranteed, tax-free income to a registered care provider for the rest of the individual’s life.

Care annuities are specialist products and can only be recommended by regulated financial advisers who have to have extra qualifications in order to advise on them, and will charge a fee for the advice.

2. Flag benefit entitlement

Licensed advisers – which can include those at the Citizens Advice Bureau who are free to talk to – can also signpost family members to the benefits a relative can claim if they’re going into care, such as Attendance Allowance.

Do note, you won’t be eligible for Attendance Allowance if you live in a care home and it is being funded by your local authority.

An adviser might also be able to signpost you to other benefits such as funded nursing care, where the NHS contributes towards nursing home fees, and continuing health care, whereby people with long-term complex health needs qualify for free health and social care arranged and funded by the NHS.

“By claiming these benefits, it can more than cover the cost of the financial advice itself,” Spencer said.

3. Help with lasting power of attorney

A financial adviser can also ensure lasting power of attorney (LPA) rules aren’t broken.

An LPA is a legal document which gives an entrusted person, known as an ‘attorney’, the ability to manage your financial affairs if you lose the mental capacity to do so yourself.

But under an LPA, the rules around an attorney gifting can be complicated and any unauthorised payments can be investigated by the Office of Public Guardian (OPG) and may need to be repaid. You may also be ordered to pay extra costs on top.

4. Manage savings and investments

Lastly, a financial adviser can help tailor a loved one’s investment portfolio to the right level of risk so funds can be accessed when needed but the remaining assets are allowed to grow to their fullest potential.

Spencer explained: “This involves dividing assets into short-term (one-three years), medium-term (three-five years) and long term (five years or more) investments, ensuring each pot is matched to an appropriate level of risk for each timeframe.”

For example, a one to three year pool of investments might be more heavily weighted with (typically lower risk) bonds and a smaller amount of shares whereas a five or more years pool might contain a greater percentage of (higher risk) equities.

When not to use a financial adviser to organise care

There are some circumstances where getting help from a financial adviser won't be the most cost-effective approach.

1. Short illnesses

In most cases, you won’t need a financial adviser if a loved one is going into care for a short period of time, say for example after an operation, which would have a minimal impact on their finances.

Spencer said: “If the care is short term or temporary then funding this from the individual’s existing assets is relatively straightforward.”

You may also be able to get short-term care for free through the NHS. You can sometimes qualify for free care and support at home for up to six weeks after a stay in hospital or to prevent you going into hospital, known as intermediate care.

2. Sufficient income

Meanwhile, if an elderly relative’s income is already enough to pay for any ongoing care, a financial adviser might not be necessary. Only if you need to sell off assets, like a home, to cover a relative’s care, is when financial advice might be advisable as this is a more complicated scenario.

Spencer explained: “When an individual’s expenditure, including their care home fees, are more than covered by their income then it makes little sense to pay for financial advice.”

3. End of life

It may not be worth paying for financial advice to get help arranging care for a loved one if you don’t expect them to live for much longer. If they die very soon after you’ve received advice, you may have paid out a significant sum of money for little benefit.

How to find a financial adviser and how much do they cost?

You can always ask friends and family for a recommendation for a good financial adviser. That way, you know if they’ve had a good experience.

For specialist later life financial advice it can be a very good idea to speak to a financial adviser who is accredited with SOLLA, the Society of Later Life Advisers.

Otherwise, you can use websites like Unbiased or Voucherfor which pair you up with financial advisers.

The cost of hiring a financial adviser will depend on which one you choose. According to the MoneyHelper website, typical hourly fees for financial advice are between £100 and £350, but you may also be charged a fixed or percentage fee.

With the end of the 2025/26 tax year approaching on 5 April, now is the time to make full use of your current £20,000 ISA allowance and start thinking about what to do with the next allowance when it resets on 6 April.

Stocks and shares ISAs provide investors with a home to grow money free of any tax on the gains, which can be significant. Those who invested the full ISA allowance every year into the FTSE All-Share Index from when ISAs launched in April 1999, for example, would have a portfolio worth £665,696 over the 26 years to April 2025, according to calculations by Interactive Investor (having contributed £326,560).

Picking the right investments for your stocks and shares ISA portfolio is key – ideally you should balance your attitude to risk, the types of investments you already hold and where you are in your investment learning curve.

MoneyWeek asked investment experts at fund platforms Fidelity International and Interactive Investor for their top ISA fund and ISA investment trust picks, to suit different types of investors.

Investing for growth

Growth investing is a strategy focused on capital appreciation – that is buying stocks in companies expected to grow in value at an above-average rate compared to the wider market.

Tom Stevenson, investment director at Fidelity International, who recently featured on the MoneyWeek Talks podcast, said: “Growth investing requires patience and a long-term mindset. Market volatility is inevitable, but staying invested and diversified gives your money the best opportunity to compound over time.”

From Fidelity’s Select 50 list, he highlighted four funds that offer different approaches to growth investing:

Dodge & Cox Worldwide Global Stock fund – a value-oriented global equity fund investing in established companies that appear undervalued but have strong long-term prospects. Its diversified international approach provides broad exposure beyond the largest US technology names.

Rathbones Global Opportunities fund – a concentrated global growth strategy targeting companies with durable competitive advantages and strong expansion potential. The fund focuses on identifying businesses with distinctive qualities and the ability to sustain growth.

Federated Hermes Asia ex-Japan – a regional fund investing in attractively valued Asian companies outside Japan. The manager seeks quality businesses that are currently out of favour but offer strong long-term upside potential.

Vanguard Global Small Cap Index fund – a passive strategy providing exposure to thousands of smaller companies across developed markets. Smaller companies can be more volatile, but they have historically offered attractive long-term growth potential for investors with a longer time horizon.

Reliable returns

Stocks and shares ISA investors seeking a reliable return might look at global equity income funds. Investing in dividend-paying companies across the globe, they have the potential for a growing income stream alongside long-term capital growth.

Global equity income funds often lean towards financially robust, well-managed businesses, a great match for anyone who loves the idea of steady earnings but still wants exposure to global markets.

Dzmitry Lipski, head of funds research at Interactive Investor, suggested the Fidelity Global Dividend fund, which has been managed by Dan Roberts since its 2012 launch, drawing on more than two decades of dividend-investing experience.

“It invests in companies globally that offer a healthy dividend yield and the potential for capital growth and aims to generate roughly 25% more income than its benchmark,” said Lipski.

The portfolio holds around 46 large, resilient companies, with Europe representing roughly 48%, North America 26% and the UK 15%, and no Chinese exposure. Lipski said: “Sector allocations are deliberately defensive, led by financials, industrials and consumer staples.”

Alternatively, Jemma Slingo, pensions and investment specialist at Fidelity International, said she likes Pyrford Global Total Return – about two thirds of the portfolio is in high quality bonds, and a third is in equities.

“It tries to keep volatility low, while providing a stable stream of inflation-beating returns,” she said. Slingo said that, while at first glance at the fund’s performance chart reveals few serious falls, “on the flip side, growth has been fairly muted particularly when inflation is accounted for”.

Pyrford has turned an initial investment of £1,000 into £1,440 over the course of the decade. If you want a ‘sleep at night’ option, however, this might be a trade off you’re willing to make.

Stevenson, from Fidelity International, added: “Dividend and interest allowances have reduced significantly in recent years, so sheltering income-producing investments from tax in an ISA can improve the net yield you receive.

“Income investing doesn’t mean sacrificing growth altogether. Many income funds aim to provide a balance of regular distributions and long-term capital appreciation.”

From Fidelity’s Select 50, Stevenson’s three picks offering diversified sources of income are:

M&G Corporate Bond fund – a fixed interest fund investing primarily in investment grade corporate bonds, with the flexibility to hold government and high yield debt.

International Public Partnerships Ltd (LON:INPP) – a specialist infrastructure investment trust investing in essential assets such as schools, hospitals, transport and renewable energy projects. These assets typically benefit from long-term contractual cash flows.

Ninety One Diversified Income fund – a multi-asset income fund investing across bonds, dividend-paying equities, infrastructure and property. Managed with a focus on limiting volatility relative to the UK stock market, the managers John Stopford and Jason Borbora-Sheen have a long track record running this strategy and have successfully been able to limit capital losses while providing a steady yet growing income.

Adventurous diversification

With global stock markets becoming increasingly concentrated and growing fears of the AI theme potentially being overheated, those wanting to spice up their stocks and shares ISA portfolio with some interesting diversification could take a look at investment trust Murray International.

Kyle Caldwell, funds and investment education editor at interactive investor, said he likes the trust because he is “looking more towards those investment trusts that use their full global remit in having a good chunk of exposure to Asia Pacific and Latin America – Murray International ticks this box”.

The portfolio is very different from the wider market. It has a value investment style, and it offers an above average dividend yield of around 4%, Caldwell pointed out.

Fidelity’s Slingo is also concerned about the stock market being dominated by a handful of US technology stocks – and also likes Latin America and Asia, but this time in the form of the Lazard Emerging Markets fund.

“The fund seeks out companies that are cheaper than the market but that have better fundamental prospects,” she said, adding emerging markets were among the best performing equity assets last year and the outlook remains positive.

“Strong earnings growth, a weak US dollar and a rotation out of the US could all boost performance this year,” Slingo said.

Newer investors

For newer investors who would like something a little more interesting than a global tracker fund and who are nervous about jumpy markets, the Fidelity Global Dividend fund could be a good option.

“It invests in companies from around the world; offers a combination of growth and income; and aims to keep volatility lower than the wider market. The fund has delivered steady gains over the past 10 years,” Slingo said.

The fund contains some well-known names like Unilever and National Grid, Slingo added, so “new investors will know that buying the fund means buying real businesses that impact them”.

Alternatively Lipski at Interactive Investor highlights a managed solution, like Interactive Investor’s Managed ISA, might be a good place to start, where the investments are chosen for you.

Investors fill out a questionnaire and are matched with one of 10 portfolios – in two styles (index investment style and sustainable investment style) and five different levels of risk. Once invested, the portfolio is periodically rebalanced – in line with the risk level you signed up for.

The fund fees are low, and there is no separate management fee as it sits within Interactive Investor’s existing flat-fee subscription-based charging model.

We look at the best investment funds for beginners and the best investment platforms for beginners in separate articles.

A less experienced investor may also want to look at absolute return or capital preservation funds. They use a mix of strategies to limit volatility and help protect against big downturns.

Lipski suggested looking at the Trojan Fund: “Co-managed by Sebastian Lyon and Charlotte Yonge, Trojan Fund takes a conservative, disciplined approach focused on preserving capital and delivering long-term real returns,” he said.

Lyon invests across a broad range of asset classes. The equity portion is focused on large, financially robust companies in developed markets, particularly the UK and US. The fund also holds high-quality sovereign and inflation-linked bonds as defensive assets, alongside a strategic allocation to gold. Cash is also used meaningfully to protect capital and allow swift investment when opportunities arise.

“The fund offers a steady, defensive option for investors seeking long-term real returns with controlled risk,” said Lipski.

Experienced investors

More experienced investors may want to consider smaller companies for their stocks and shares ISA. “These can be significantly riskier than large ones,” Fidelity’s Slingo pointed out, “however, experienced investors with long time horizons might want some exposure to this part of the market”.

Slingo suggested the Brown Advisory US Smaller Companies fund. “It deploys a big team of researchers to find the most promising smaller companies listed in the US. Their strategy is based on the belief that good fundamental research coupled with a long-term approach can generate attractive outperformance,” she said.

The fund is a higher risk option, and its performance has lagged the benchmark in recent years. “However, it may appeal to experienced investors who are concerned about the dominance of huge US tech stocks in their portfolios,” said Slingo.

Finally, according to Dave Baxter, senior fund content specialist at Interactive Investor, another good option for the more seasoned investor is the Marlborough Special Situations fund.

It invests in the dynamic growth potential of the UK’s innovative and agile smaller companies. Its sector bets are markedly different with big weightings to industrials, consumer discretionary shares and technology. Top holdings include Zegona Communications, Boku and SCA Investments.

Baxter said: “Marlborough Special Situations has been poor in 2025, and in recent years. The fund has more than 150 holdings and small position sizes, with its top holding making up only 2.6% of the portfolio.

“However, the fund has a good long-term record, and good exposure to micro caps, small caps and mid caps. It should in theory do better when interest rates fall in earnest.”

More homeowners than ever are using equity release to pass some of the almost £4 trillion over 55s hold in property wealth onto the next generation, according to new research.

Equity release allows older people to access the wealth in their homes, in the form of a loan against their property’s value, without needing to sell or move.

A shift has occurred in the reasons why homeowners are choosing equity release, with a record number doing so for intergenerational gifting – one way to potentially avoid inheritance tax – according to 2025’s full year data from Canada Life, which provides equity release loans.

Last year almost a fifth (19%) of those using equity release did so to gift money to family members. This is up 3% on the previous year, and the highest figure recorded in a decade of Canada Life’s customer data.

This upward trend points to the increasing significance of intergenerational support, as older homeowners look to help children and grandchildren with financial milestones such as house deposits and education fees.

Sadna Zaman, home finance proposition manager at Canada Life, said: “More customers are incorporating equity release into their estate planning strategies, using property wealth to pass assets to the next generation in a timely and tax-efficient way.

”This is enabling families to support loved ones with major milestones, such as home purchases or education, while also potentially reducing inheritance tax liabilities.”

How much UK property wealth do over 55s have?

Property owners in the UK aged 55 and over held a total of £3.7 trillion in property wealth in the period April 2020 to March 2022, according to Office for National Statistics data.

This represents 68% of the nation’s total housing wealth – defined as the value of all properties minus mortgage debt.

Equity release is only available to certain homeowners typically aged 55 and over.

The 55 to 64 age group owns the greatest amount of private property wealth with a total value of £1.4 trillion, a quarter of the nation’s private housing wealth. The cohort aged 65 to 74 holds £1.2 trillion (23%) and those aged over 75 hold £1.1 trillion (20%).

Stephen Lowe, group communications director at retirement firm Just Group, said: “The sheer scale of property wealth held by older people enables them to plug into the powerhouse of financial resources held in their homes to meet a range of needs in later life – from topping up their own income in retirement to helping family.”

He added: “The continued freeze on inheritance tax thresholds is likely to tip more estates into paying the tax but using property wealth to make living inheritances could provide homeowners with a means of mitigating the impact of inheritance tax and provide loved ones with extra financial support.”

Reasons over-55s use equity release

Home adaptations or improvements emerged as the leading reason for using equity release in 2025, with 43% of applicants citing this when applying – a substantial 10% uplift on the previous year, according to the Canada Life data.

Whilst clearing an existing mortgage remained a key motivation, 2025 marked the first year where it was no longer the leading reason for taking out equity release, dropping from 36% in 2024 to 27% in 2025.

The data also highlighted a marked increase in the number of people using equity release to establish an emergency savings fund – from 8% in 2024 to 21% in 2025.

The rise points to heightened financial caution, with more customers prioritising a safety net against unexpected expenses, possibly in response to economic uncertainty or personal health concerns.

Zaman from Canada Life said: “The range of uses for equity release underscores the importance of tailored, expert advice. Equity release may not be the solution for everyone, but advisers play a vital role in helping customers make informed, confident decisions about their financial futures in later life.”

How popular is equity release?

Equity release is increasingly popular. The equity release market grew 11% in 2025, according to the latest data from the Equity Release Council.

Total annual lending increased from £2.3 billion in 2024, to £2.57 billion in 2025. The Council’s market data is compiled from actual whole-of-market returns, making it the UK’s definitive equity release data.

Lifetime mortgages make up more than 99% of the market. These mortgages let people borrow against their homes without making repayments unless they choose to. The loan and interest is paid when the customer dies or goes into long term care.

However while equity release is becoming more popular, it is not without its downsides. Before arranging your application, a regulated equity release adviser must explain all the risks of equity release.

These include the fact the cost of borrowing will eat into the remaining equity in your home if you choose not to make any repayments on your equity release loan. Also expensive early repayment charges will apply if you pay off the equity release loan earlier than the terms of the contract allow, which can be up to 15 years.

Managing the fallout from a loss of income is a real problem for increasing numbers of Brits, according to new figures. Preparing as much as possible ahead of time – and knowing what to expect – can keep your finances on track despite the shock.

Payroll employment was down 135,000 in the three months to November, latest Office for National Statistics data shows, 0.5% lower than a year earlier. The redundancy rate was up 1.1 percentage point at 4.9%.

Provisional figures showed a further fall of 43,000 or 0.1% in payroll employment in December, following chancellor Rachel Reeves’ tax-raising Budget. That would be the fastest fall in five years, but the data could be revised.

The latest bleak employment data follows a leading indicator of future job cuts from the Insolvency Service this month. The jump in potential redundancies to 33,392 in the four weeks ending 14 December took the reading to the second-highest level in the post-pandemic period.

David Little, partner in financial planning at wealth management firm Evelyn Partners, said: “Earners at all levels of seniority and across many sectors in the UK face a great deal of uncertainty, and if the worst predictions are correct we could be on the cusp of a jobs market downturn.”

Much of the roughly £66 billion in tax rises announced in the chancellor’s two Budgets is yet to feed through, he said, adding reform of business rates and a rapidly rising minimum wage are expected to hit many businesses hard.

“Combine this with the growing effects of artificial intelligence which are now feeding into firms’ hiring and firing decisions, and even though the economy is not in recession, the threat of job loss looms,” Little said.

Redundancy or a drop in income will often come out of the blue. But there are some steps people can take to help protect against losing their job or suffering a drop-off in freelance work or business revenues, and there are also strategies to cope with the financial fallout if it happens.

How to manage a sudden drop in income

1. You may need a bigger safety net

Cash in an easy access savings account is going to provide your best bet at an emergency safety net in event of a sudden drop in income – but you may need more than you think. While the typical advice is three to six months of outgoings, in this job market that may not be enough.

“I recommend my clients aim to save six to twelve months of basic expenditure as a minimum in their cash reserve for peace of mind,” said Little.

Paying the mortgage is often the main concern for those who face losing their income and this could eat into any redundancy payment if other provisions haven't been made.

“If someone has a war-chest for this key outgoing alongside other fixed monthly bills they should have more flexibility if they do face redundancy – which can in turn give them more freedom when it comes to choosing their next move work-wise,” said Little.

Aside from savings, income protection insurance policies can be very valuable in times of financial stress. Many employers include a form of income protection as a standard or optional employee benefit, but while this should cover illness and disability, it will very rarely protect against unemployment.

To protect yourself against the possibility of redundancy you can get personal stand-alone income or mortgage protection policies that are available from insurance providers and brokers.

2. What to do if you’re made redundant

Redundancy often comes as a shock. But there are a number of points you will need to address sooner rather than later. Understanding them ahead of time puts you in a stronger position. For example:

• You should receive payment in lieu of notice, so it’s important to know what your notice period is. If you don’t and can’t locate your contract, speak to your HR department.
• At this stage, if it hasn’t been offered already, you may be able to ask for gardening leave. Having this time off is a great opportunity to take a well-earned break, assess your redundancy package and make some plans.
• Next, make sure you know exactly what your redundancy pay entitlement is. There are rules around the amount of statutory redundancy pay but many companies go above this figure.
• It’s always worth considering if you can negotiate a better redundancy package. This is where it is beneficial to speak to an employment solicitor or possibly a union representative to discuss your options.
• It’s important to identify the employee benefits that will be lost through redundancy, like death in service life cover or private medical insurance, as it could be a priority to replace them with self-funded policies.

3. What is my redundancy tax situation?

There is a tax-free threshold for qualifying redundancy payments, set at £30,000, with any amount over this threshold taxable at your marginal rate of income tax. Employee National Insurance is not deducted from a redundancy payment.

For example, someone who has an annual salary of £36,000, has earned £15,000 so far this tax year and is offered £50,000 redundancy would owe £4,000 in tax on their redundancy pay.

This is because the first £30,000 of their redundancy pay is tax free but the remaining £20,000 is taxable. As they have earned £15,000 so far this year, even with the £20,000 added to this, they are still within the basic rate tax band, so tax of £4,000 is due on the redundancy pay (20% of £20,000).

Employees should also consider whether they could end up in a higher rate tax bracket, depending on their income and redundancy pay.

Payments in lieu of notice and holiday entitlement will be taxed as regular income. Depending on where you are in the tax year, and how much you earn for the remainder of it, you might be overcharged by PAYE. But it is up to you to check this and notify HMRC, and it might involve claiming back overpaid tax with a self-assessment tax return.

4. Using your pension to avoid tax

If your redundancy pay-off exceeds the tax-free amount, and you don’t need the cash right away to live on, the most straightforward option for keeping more of it is to have the excess paid into your company pension. This allows you to benefit from income tax relief and possibly National Insurance relief.

Little explained: “How you receive or claim your tax relief will depend on how the pension scheme is operated.

“While a salary sacrifice system will grant both your full income tax and employee National Insurance relief on payments automatically – with some employers passing on all or part of their National Insurance relief as well – other schemes will require the saver to claim some of their income tax relief on their tax return if they are a higher or additional rate taxpayer,” he said.

The maximum most people can pay into a pension each tax year with pension tax relief is £60,000 gross – this includes monthly contributions and any lump-sums you have already made into your pension in that tax year, whether by you, your employer or in the form of tax relief.

Personal contributions are also limited by your relevant earnings for the year. Plus the annual allowance can be tapered down for higher earners. The standard annual allowance of £60,000 reduces by £1 for every £2 of adjusted income you have above £260,000. The minimum tapered annual allowance is £10,000.

Little said: “Financial advice can be useful if you want to squeeze more into your pension by utilising carry forward allowances going back up to three tax years. In combination with salary sacrifice, large redundancy packages can turbo-charge retirement savings by massively reducing income tax and National Insurance liability.”

For some of our clients, taking this action with voluntary redundancy packages has enabled them to retire sooner, he added.

“But using carry-forward to maximise a pension contribution – and working out relevant earnings – is potentially complicated, can easily go wrong and is usually best supported by working with a financial planner,” Little said.

5. Planning for the future

Whether working and guarding against redundancy, or preparing for a potential drop in investment income that you rely on to fund your retirement lifestyle, it’s a good idea to make a financial plan to calculate how long you can comfortably remain without an income.

“Be realistic and get a complete picture of your financial situation and monthly outgoings in order to formulate a plan,” Little said. “And for this, it is hard to replicate a sophisticated cashflow model – and the support and recommendations that come with it from a good financial planner.”

Fast but not too fast is the best way to sell a property – homes under offer in 10 to 11 days typically achieve the best prices, new research suggests.

The speed of a house sale can make, or cost, sellers thousands of pounds, analysis from the HomeOwners Alliance’s Best Estate Agent Finder tool has found.

Agents with an average selling time of 11 days achieve 100.4% of the asking price, raising an extra £1,000 on an average priced property, data from 6,000 estate agent branches across the UK revealed.

Perhaps counterintuitively, selling too quickly can work against sellers. Properties sold within seven days or less achieved just 94% of the asking price, leaving sellers almost £16,000 worse off on an averagely priced home.

Overall though, the research revealed a pattern – the longer on the market, the lower the final price for the property.

Paula Higgins, founder and chief executive of the HomeOwners Alliance said, “Right now every pound matters to homeowners. Our data shows there is a sweet spot when selling a home and that is around 11 days. Sell too fast and you leave money on the table. Let it drag on over a month and buyers start knocking thousands off the price.”

We look at what house features homebuyers look for and the best places to live in the UK and how much they will cost you in separate articles.

How can a slow sale impact the property asking price?

After 30 days on the market, sellers typically have to settle for less, accepting 98% of their asking price. After three months, (90 days), the situation gets worse for sellers, typically accepting 95.5% of their asking price.

With the average UK home now selling for around £270,000, these percentage differences quickly add up. A home sold after one month will typically be £5,400 below the asking price. After three months, that rises to around £18,400.

Estate agents who consistently sell in around 11 days are the ones achieving the best prices, according to the data – and when a home sits on the market for weeks, it is often a sign something needs to change.

You can see how quickly homes like yours are sold by your local estate agents using the HomeOwners Alliance’s Best Estate Agent Finder. It ranks your local agents by how successful they are at selling quickly and securing the asking price.

Top tips for property sellers in 2026

1. Get your price right

Sellers have kicked off 2026 pricing their properties ambitiously – the average asking price on property website Rightmove jumped month-on-month by £9,893 (2.8%) from £358,138 in December to £368,031 in January, the largest spike in any month since 2015.

But it looks like a buyer’s market still – the number of homes listed is the highest it has been at this time of year since 2014, Rightmove said, and a third of homes currently on the market have seen a price reduction. To make sure your property sells in the golden 11 day sweet spot, price it competitively.

2. Instruct your conveyancing solicitor early

Choose your conveyancing solicitor early, as soon as you decide to list your home, and start pulling paperwork together now if you want to secure a quick sale. Flag up any potential issues now, rather than letting the buyer discover them.

3. Get your house ready for sale

If there are any issues that might come up in a survey and delay the move, consider fixing them now. Energy efficiency improvements are going to be more of a selling point this year and getting an EPC early in the process will give you an advantage.

4. Choose the right buyer

Everyone wants to get the best house price, but if you want to sell quickly as well, then opt for a chain-free buyer who isn’t relying on selling their home to buy yours.

Entrepreneurs and family business owners are being urged to act now to avoid some potentially damaging tax bills ahead of changes due to come into force in April.

A new cap on agricultural property and business inheritance tax reliefs will come into force on 6 April. This means the families of business owners are likely to face greater inheritance tax (IHT) bills at death. In some cases this could spell jeopardy for the firm itself, financial advisers have said.

Lee Matthews, senior partner in financial planning at wealth management firm Evelyn Partners, said: ‘For many business owners looking at the long-term prospects for their firm and their family’s financial security, 6 April this year is a date that creates a clear deadline for planning.

“They can still take steps now to mitigate some potentially damaging tax liabilities. A sudden and unexpectedly large IHT bill, particularly where liquid assets are in short supply, could spell the end for even a successful enterprise and the jobs it provides.”

What inheritance tax change is happening in April 2026?

From 6 April 2026 there will be a £2.5 million cap on the combined value of assets eligible for 100% Business Property Relief (BPR) and Agricultural Property Relief (APR). Any value above this cap will only receive 50% relief, potentially leading to an effective 20% IHT charge on the excess for farms and businesses.

The government had originally set the BPR and APR cap at £1 million but later U-turned on this policy to up the limit.

Another recent policy revision means spouses will be able to inherit unused tax relief, similarly to the inheritance tax allowance (also known as the nil-rate band). Any of the £2.5million allowance unused at death will be transferred to the surviving spouse – and it is not necessary for the deceased spouse to have owned qualifying assets.

What should business owners consider doing before April to avoid inheritance tax?

Evelyn Partners’ Matthews said there is a six step sequence business owners could follow ahead of April 2026, particularly in the event they want to transfer their business into a trust or sell it. What matters is not just the steps – but the order in which they are carried out.

1. Identify which assets qualify for business relief

Not all parts of a business may qualify for business relief. Owners should review the company structure, activities and balance sheet, potentially with the help of professional advisers. Large cash holdings, investment activities that creep into the company over time or group structures with mixed trading and investment entities may not qualify, said Evelyn Partners.

2. Consider a gifting strategy before the April 2026 deadline

With the rules for business relief changing, now is the time to review gifting strategies to avoid inheritance tax, particularly where trusts are involved, Evelyn Partners said.

Before 6 April 2026, it is possible to transfer business relief-qualifying shares – of any value – into a discretionary trust, with no immediate inheritance tax charge, provided the shares qualify for relief.

From 6 April 2026, the amount of business relief-qualifying assets that can be transferred into trust with 100% relief will be capped at £2.5 million per individual. Any excess above this will attract only 50% relief, potentially giving rise to an immediate inheritance tax charge.

This £2.5 million allowance is now transferable between spouses or civil partners, allowing a couple to pass up to £5 million of qualifying assets free of IHT on the last spouse’s death.

Matthews said: “Trusts can be key to succession planning, family wealth preservation and long-term control, but they should be considered as part of a broader strategy. Gifting, whether directly or into trust, must be affordable and should not put your own financial security at risk.”

If you are considering using trusts, allow for plenty of time to allow time for legal drafting, valuations and any required shareholder approvals.

3. Carry out ownership changes early

Many financial planning strategies for businesses, Matthews pointed out, require changes in the ownership structure before shares can be settled into trust or before a sale can proceed. These changes often take longer than expected due to legal processes, valuation work and the need for shareholder consent, so should be done as early as possible.

Examples include creating new share classes or preparing a holding company for a future transaction.

“It is critical that reorganisations are completed before any trust transfers are attempted,” Matthews said. “Poor sequencing can inadvertently break business relief conditions or create unexpected tax exposures.”

4. Begin life insurance underwriting

If a business is sold, business relief qualifying shares convert into cash. “The moment this happens, the potential inheritance tax protection they offered is lost. If the owner dies before the proceeds are reinvested or placed into an appropriate structure, their estate may face a large inheritance tax exposure,” Matthews said.

Life insurance held in trust can provide a simple and effective bridge through this risk period, but underwriting can take weeks or months. Medical evidence, GP reports and financial information can create delays that may push completion too close to the deadline.

“Starting the underwriting process early can help to have cover in place when it is actually needed rather than after the event,” Matthews advised.

5. Make sure your business and personal financial plans align

Business owners often prepare for a sale or refinancing without considering how this interacts with their own wills, trusts and estate plans. This can be risky.

Matthews said: “For example, a new holding company may change business relief status, or a change in voting rights may affect succession intentions. Wills may need to be updated to make best use of the business relief allowance or to direct assets to trusts in a way that preserves and maximises potential relief.”

Advisers should coordinate legal, tax and investment teams so that both the business and personal sides of the plan support each other. “A short misalignment at the wrong moment can jeopardise years of planning,” Matthews warned.

6. Prepare for post-business sale cash

Once a business sale is complete, if that is the chosen route, owners often hold large amounts of cash for a period while deciding how to reinvest. Evelyn Partners cautioned this creates an immediate inheritance tax risk and can also lead to missed opportunities if reinvestment is slow.

“A forward plan should outline where liquidity will be held, whether a family investment company or personal investment company is appropriate and how the proceeds will be managed until a long-term portfolio is established,” said Matthews.

Planning for this stage now reduces stress after completion and makes the overall transition more tax efficient.

Get financial advice

Ultimately, given the complexity of business relief and inheritance tax rules, it makes sense to speak to a Financial Conduct Authority-regulated professional financial adviser before taking any action. You can find a directory of your local experienced financial advisers on websites like VouchedFor and Unbiased.

Taxpayers who need to disclose capital gains in their self-assessment tax return this month should double check they have used the correct rates following a change in the 2024/25 tax year.

Failure to do the capital gains tax (CGT) calculations properly could lead to a penalty from HMRC.

Changes to the rates of capital gains tax made part-way through the 2024/25 tax year in the 2024 Budget will mean the timing of any transaction will be key to determining how much you owe in CGT liabilities, accountancy firm BDO has said.

However, this year’s self-assessment tax return form – due by a deadline of 31 January – will not automatically work this out.

Elsa Littlewood, private wealth tax partner at BDO, said: “Changing the CGT rates part way through the year has the potential to be a real banana skin for those completing the form and can be particularly tricky for those doing so without professional help.”

“There is a risk that people unfamiliar with the rate changes will unwittingly input the wrong information as the self-assessment form will not automatically calculate the right CGT liability,” she added.

Changes to capital gains tax rates

From the date of the Autumn Budget in 2024 (30 October), the main rates of capital gains tax applying to disposals of assets (apart from residential property and carried interest), increased.

The capital gains tax rate rose from 10% to 18% for basic rate taxpayers and 20% to 24% for higher rate taxpayers.

This means for the self-assessment tax return due by 31 January 2026, taxpayers need to split gains made at different dates to calculate the right rate of tax.

It also means taxpayers will need to make sure to allocate any losses and the annual capital gains tax allowance – currently £3,000 – to the gains realised on or after 30 October, in order to get the most tax relief.

HMRC’s self-assessment software cannot do this, accountancy firm BDO pointed out, it just calculates tax based on the pre-Budget rates.

For example, using HMRC’s software, the following gains and losses would be calculated as:

2024/25 gains = £25,000

2024/25 losses = £5,000

Annual CGT allowance = £3,000

Taxable gain = £17,000

Tax at 20% (assuming a higher rate taxpayer) = £3,400

The actual capital gains tax due will depend on the date of the disposal of the assets – and could be hundreds of pounds higher.

If, say in the same example, £10,000 of the gains were pre-2024 Budget and £15,000 post-Budget (after 30 October 2024), the capital gains tax bill would be £280 higher, due to the rate change in the Budget.

If all the gains were made after the Budget rate change, the capital gains tax bill would be £680 higher.

How to file the correct capital gains tax return

Because taxpayers can’t rely on HMRC’s software to accurately calculate their capital gains tax for the 2024/25 tax year – due to the 2024 Budget rate change – they should make use of adjustment box (51) when filing a self-assessment tax return, so they pay the correct amount of tax.

Taxpayers should also ensure they don’t forget to explain their calculations on the form (using box 54). HMRC has made a specific capital gains tax ‘adjustment calculator’ for the 2024/25 tax year.

In addition, you may need to include a disclosure in your tax return if you entered into an unconditional contract before 30 October 2024, which completed after that date.

Littlewood at BDO said: “It is helpful that HMRC have released a calculator that can be used to work out the adjustment to capital gains tax, but it would have been better if this was integrated within the tax return software.

“We would hope that HMRC would not charge penalties if tax returns submitted using HMRC’s software are incorrect and the amount unpaid is minor. But there is a risk of mistakes being made and it could lead to a flurry of disputes with HMRC later.

“Even if you have already submitted your self-assessment form, you may wish to go back and double check it to ensure it’s right.”

Interest rate changes can have a big impact on retirees’ income, for better or worse. For people who have a few different types of pension the effects can be magnified. With UK interest rates falling, we look at how a cut in the Bank of England base rate alters the landscape for those at and near retirement.

Pensions are sensitive to changes in interest rates. The Bank of England has cut interest rates from 4% to 3.75% following a cooling in the rate of inflation, as measured by the Consumer Prices Index, as well as slower wages growth.

Interest rates in the UK started falling in the summer of 2024, with the Bank of England cutting rates in August 2024 and again in August 2025, bringing the rate down to 4% by late summer 2025 as inflation eased.

Further cuts are anticipated into 2026 as the economy cools and inflation stays low. Lenders have been reducing mortgage rates in response – but for millions of people in or approaching retirement the big question is, what do falling interest rates mean for my pension and retirement income?

Adam Cole, retirement specialist at Quilter, said: “An interest rate cut can have very different effects across the pensions landscape, and the impact will depend largely on the type of pension someone holds and what they are planning to do with it.”

Impact of interest rate cut on defined benefit pensions

For members of defined benefit pension schemes, lower interest rates tend to push up pension transfer values – the amount of lump sum you could get instead of receiving a guaranteed, regular income.

This is because the future income promised by the pension scheme becomes discounted at a lower rate, increasing its present value if you transfer out.

While that can make transfer values look more attractive on paper, it does not automatically mean transferring is the right decision, said Cole.

“Giving up a guaranteed, inflation-linked income for life remains a significant step, and one that should only ever be considered with specialist financial advice,” he cautioned.

What does an interest rate cut mean for defined contribution pensions?

For those with defined contribution pensions, the impact of a base rate cut is more nuanced. This is because of how they are invested. While a base rate cut is usually positive for stocks it can mean lower income from bonds.

Cole said: “Rate cuts are often supportive for asset prices, particularly equities, which can benefit pension pots invested for growth. However, they also tend to push bond yields lower, which can affect the long-term income potential of lower-risk assets.”

This highlights the importance of asset allocation and not viewing pensions purely through the lens of short-term interest rate moves, he added.

Impact of an interest rate cut on annuities

Annuities sit somewhere in between defined benefit pensions and defined contribution pension when it comes to the effects of an interest rate cut.

After years of being largely overlooked, annuity rates have improved markedly compared with the ultra-low interest rate environment of the past decade, making guaranteed income more attractive for those who need a source of secure income.

However, annuity pricing remains closely linked to gilt yields, meaning any sustained move lower in interest rates would be expected to put downward pressure on the income available to new buyers.

Cole said: “For those considering an annuity, the trade-off between certainty and flexibility remains key, particularly in an environment where inflation and interest rates remain uncertain.”

Yet ahead of the base rate cut, gilt yields – a key indicator of annuity rates - remained stubbornly high. As a result, annuity rates remain among the most competitive seen in the past decade.

For example, at the start of this year, a Canada Life benchmark lifetime annuity purchased with £100,000 would have provided an annual income of around £6,800 for a healthy 65-year-old. Today, improved rates mean the same individual could secure approximately £7,300 per year – an increase that amounts to nearly £9,500 in additional income over a 20-year retirement, by Canada Life’s calculations.

Should I change my pension after the base rate cut?

Juggling pensions in the face of falling interest rates is no easy thing. If you have several pensions it can be worth speaking to a financial adviser so they can see the whole picture of your various pots.

Cole said: “Overall, changes in interest rates are a reminder that pensions are not a single product but a collection of long-term strategies. Decisions should be made in the context of an individual’s wider retirement plan, rather than reacting to any single rate decision in isolation.”

Retirement income today is rarely generated from a single source. It is typically built from a combination of the state pension, workplace or personal pensions, and other assets, each playing a different role.

Understanding how these different pension and non-pension income streams work – and the risks attached to each – can help you approach retirement with clearer expectations, financial advisers say.

Middle-aged Brits are sleepwalking into retirement without a plan, and time is running out, a survey has warned. Retirement income options are not being considered by 73% of 45-60 year olds, according to the study by pension provider LV.

A third (33%) of respondents to the survey aged 45 to 60 said they are unaware of financial products or strategies available to help protect their retirement income or boost their pension savings.

Sue Allen, chartered financial planner at Chester Rose Financial Planning, said: “When you retire, one of the key questions is how you will take an income. Many people find they spend more at the start of retirement as they enjoy their newfound freedom and tick off bucket-list experiences.

“Once early retirement has passed, your spending may settle down, but you might also want to prepare for higher costs in your later years in case you need to pay for care. Setting out your retirement goals could help you understand how to create an income that suits your lifestyle at different points in time.”

We look at the different retirement income options – like the state pension, defined benefit pensions versus defined contribution pensions, workplace pension and SIPPs as well as annuities, cash savings accounts, ISAs and property rental income – and how they can work together to fund your later years.

State pension – a baseline income

The state pension provides a guaranteed, inflation-linked income for life and forms the baseline of retirement income for most people.

The full new state pension (for most post-2016 retirees) is now £230.25 per week for 2025/26, or £11,973 per year, while the full basic state pension (for those born before April 1953) is £176.45 weekly – amounting to £9,175.40 a year – both increased under the triple lock, with payments made every four weeks.

Eligibility and amounts depend heavily on National Insurance contributions, requiring 35 years for the full new state pension and around 30 for the basic. You can begin claiming the state pension at 66, but the state pension age is rising.

Jude Dawute, managing director at financial advice firm Benjamin House, said: “While it provides an important level of security, the state pension on its own is generally designed to meet basic living costs, rather than support a broader retirement lifestyle.”

Pensions UK, a trade body, estimates a single person household needs £13,400 a year post-tax income to cover the basics in retirement – excluding housing costs – so while most of this will be covered by the new state pension, some other savings or income will be needed besides.

We look at how much you need for a comfortable retirement in a separate article.

Defined benefit pensions – predictable income

Defined benefit (DB) pensions provide a pre-determined income for life, usually payable from a scheme’s normal retirement age (commonly 60 or 65). The income is not affected by market movements and continues for as long as you live. You can usually take 25% tax-free as a lump sum, with the rest of the income taxed at your marginal rate.

DB pensions are typically used to meet core, ongoing expenditure, because the income is known in advance and often includes inflation protection.

So if a person, aged 65, had a defined benefit pension paying £18,000 per year and gets the full new state pension of £11,973 per year, their total guaranteed retirement income would be £29,973 per year.

“This income would be paid regardless of investment conditions or how long the person lives, providing a stable base from which other retirement decisions could be made,” said Dawute.

Defined benefit pensions are usually inflexible regarding how income is taken and at what level. However, many allow a tax-free lump sum in exchange for lower income.

Allen, from Chester Rose Financial Planning, said: “The decision whether to take a tax-free lump sum or not needs careful consideration, as once taken, it cannot be reversed. In most cases, maximising guaranteed income is preferable unless the lump sum is genuinely required.”

Defined contribution pensions – flexibility and risk

Defined contribution pensions work differently to defined benefit pensions. Instead of providing a guaranteed income, they build up a pension pot, which can usually be accessed from age 55 (rising to 57), with no requirement to retire at a fixed age.

This flexibility allows income to be tailored to individual circumstances, but it also means retirees remain exposed to several risks.

“Unless funds are converted into guaranteed income – by buying an annuity – DC pensions remain invested. Their value can therefore rise or fall with markets,” Dawute said.

A key consideration is sequence risk, he pointed out. This is the impact of taking withdrawals during periods of poor market performance, particularly early in retirement.

Dawute said: “Losses at this stage can have a disproportionate effect on how long a pension pot lasts. Diversified portfolios can help manage volatility, but investment risk cannot be removed entirely.”

Consolidation, transfers and SIPPs

Many people reach retirement with multiple defined contribution pensions, built up over different jobs.

Consolidation brings these pensions together, often into a self-invested personal pension (SIPP) or a workplace pension scheme. This can make it easier to understand your overall retirement income, manage investments consistently, and plan withdrawals.

“In some cases, individuals may also explore pension transfers from older arrangements and defined benefit pensions into newer ones with greater flexibility,” said Dawute. But he added where protected benefits exist – like guaranteed income rates – these decisions require careful consideration.

Turning defined contribution pensions into income

Deciding how much to withdraw from your pension can seem like a balancing act and there are often many factors you need to consider.

Allen said: “For example, when you access your pension, you can usually take up to 25% as a tax-free lump sum. You might be tempted to withdraw the money to travel, renovate your home, or indulge your hobbies. However, withdrawing a lump sum at the start of retirement could affect your long-term finances.

“You don’t have to take a lump sum at the start of retirement to benefit from the tax-free money – you may spread it out over several withdrawals, for instance,” she said.

Option 1: Flexi-access drawdown – adaptable income with market exposure

Drawdown allows pension funds to remain invested while income is taken as needed. It is often used to support discretionary spending, such as travel or irregular expenses, and to keep funds accessible. You typically take your 25% tax-free cash upfront.

Drawdown income is not guaranteed and is exposed to:

• Market volatility
• Inflation risk if withdrawals rise faster than investment growth
• Longevity risk if withdrawals continue for longer than expected

When you are in drawdown the sequence of your investment returns is of vital importance. In the scenario shown below, which shows a retiree with a portfolio of £100,000, taking annual withdrawals of £5,000, their portfolio could be 22% worse off if they experienced losses in the first two years of retirement, compared to having these same losses in years four and five.

Source: Quilter. Table shows a 22% difference between portfolio 1 and portfolio 2 after five years

Option 2: UFPLS – simplicity and tax considerations

Uncrystallised funds pension lump sums (UFPLS) allow individuals to take payments directly from their pension, with 25% tax-free and 75% taxed as income each time, unlike flexi-access drawdown where the whole tax-free amount is usually taken upfront.

It's a way to get money bit-by-bit without setting up a full drawdown plan or triggering the money purchase annual allowance (MPAA) on the first withdrawal and allowing the rest of your fund to keep growing.

UFPLS is commonly used for:

• One-off expenses
• Early retirement bridging until the state pension or other retirement income kicks in
• Smaller pension pots

Dawute said: “Because each withdrawal is taxed, timing and frequency can significantly affect your overall tax position.”

Option 3: Annuities – guaranteed income and annuity risk

An annuity converts pension savings into a guaranteed income, usually payable for life.

People often use annuities to cover essential spending, reducing reliance on investment markets and removing the risk of outliving their savings.

“However, annuities involve annuity risk – once an annuity is purchased, the income is typically fixed based on market conditions at that time and cannot be changed later,” said Dawute.

Inflation risk and annuities:

• Level annuities start at a higher income but lose purchasing power over time
• Inflation-linked annuities protect real income but begin at a lower level. This reflects a trade-off between higher initial income and longer-term protection against rising prices.

Other sources of retirement income

Drawing income from a range of assets can help diversify risk and improve financial resilience in retirement.

Matt Finch, director of wealth management at Bentley Reid, pointed to some non-pension assets that can boost your retirement income:

ISAs

“ISAs offer highly tax-efficient income, with withdrawals, income and growth free from tax. In many cases, it can be advantageous to utilise taxable income first to maximise allowances before drawing on ISA wealth,” said Finch.

Cash

Cash savings can provide liquidity and short-term security, reducing the need to sell long-term investments during periods of market volatility, he said.

Rental property income

Finch said: “Rental income can continue to provide a steady income stream in retirement, although it remains taxable and carries ongoing management responsibilities, which should be considered in the context of lifestyle objectives.”

Part-time work

“Part-time or consultancy work can offer a phased transition into retirement, maintaining income and reducing reliance on pensions in the early years,” he added.

Combining pension income streams

The most effective retirement income plans combine guaranteed income, flexible withdrawals and long-term growth, according to the experts.

Chartered financial planner Sue Allen said: “They are built around spending needs, health and attitude to risk – and are reviewed regularly as circumstances and tax rules change. Retirement income planning is not about finding the perfect product. It is about structuring your money so it supports the life you want for as long as you need it.”

A 65-year-old with a full state pension, NHS pension, a SIPP valued at £400,000 and an ISA of £100,000, who is continuing to work until 67, could have a retirement income portfolio that looks something like the below, she said.

In early retirement, income is topped up from the SIPP and ISA to support higher spending. Once the state pension and NHS pension payments begin, reliance on the SIPP reduces.

Later in life, income needs decline further, and guaranteed income covers most spending, while modest withdrawals continue to provide flexibility.

“The aim is not to maximise income early on but to keep the income sustainable and tax-efficient,” Allen said.

Chancellor Rachel Reeves may have urged everyone to do their bit to help balance the nation’s finances in her Autumn Budget but the actual impact appears to vary across generations.

Reeves unveiled a range of changes in her latest fiscal update last month, including a cap on pension salary sacrifice contributions and a freeze on income tax thresholds.

Savers will also be hit by a cut to the cash ISA allowance from April 2027, while landlords are facing higher taxes on property income.

Research by Standard Life has found that public sentiment towards the Budget is broadly negative, with overall approval standing at -8% based on a net percentage balance.

But age is the defining fault line.

Approval plunges to net –37% among those age 55-plus, according to Standard Life, driven by dissatisfaction with tax rises and changes to ISAs and pensions.

Meanwhile, sentiment actually flips among 18 to 34-year odds to a more positive net +37%, which the financial provider suggests means younger adults see more upside in the chancellor’s statement.

For example, the national living wage increase sees net support of +58% and removing the child benefit cap stands at net +33%.

Mike Ambery, retirement savings director at Standard Life, said: “The Budget has landed very differently depending on where people are in life.

“Younger adults see room for optimism - many support steps like the rise in the national living wage, which perhaps gives them a sense that the system is beginning to move in their favour. However, it seems older generations feel as though the rug is being pulled under them at the worst possible moment.”

Here is how the Budget is set to hit different generations.

Salary sacrifice shake-up

The government is planning to cap how much workers can put into a pension using salary sacrifice at £2,000 by 2029, potential boosting the Treasury’s National Insurance intake.

This has raised concerns that the changes may make pension saving too complicated.

Standard Life’s research found almost one in five of all consumers are “very concerned” about the changes - jumping to a third (33%) among those earning £70,000

Ambery added: “Salary sacrifice has been one of the most reliable tools for helping people make every pound of their savings go further. Changing it now risks making saving feel harder at a time when most people are already under-saving for retirement.”

Jason Hollands, managing director at Evelyn Partners, suggests the biggest impact of the salary sacrifice changes will be on middle-aged higher earning professionals who are in jobs where bonuses are part of their remuneration, as much salary sacrifice comes through individuals waiving bonuses in lieu of a pension contribution to reduce a tax bill.

He said: “This is especially useful for people seeking to keep their report earnings below the £100k threshold at which the personal allowance is tapered away.”

Tax hikes

The Budget confirmed that income tax thresholds will remain frozen until 2031, extending the current freeze by three years, creating fiscal drag.

Standard Life’s research reveals a significant generational divide on this announcement. Support for the move for 18–34-year-olds stands at net +36%, while net support for the over-55 age group falls to -29%.

Older generations may be feeling more negative as other reforms such as the mansion tax and higher income tax on property income for landlords is more likely to hit them than younger people.

However, Hollands highlights that those solely on the state pension as their source of income will continue to benefit from rises under the ‘triple lock’ formula and won’t have to pay income tax even if the state pension exceeds the personal allowance.

It is not all positive for younger generations though.

Hollands added: “On the surface you might think the rise in the minimum wage must be a good thing for people just starting out in work and at the lower end of the income spectrum. However, these measures are likely to see reduced hiring by businesses struggling with increased costs, making it more difficult for younger people get into work in the first place.

“There is already evidence that many young people are leaving the UK in increasing numbers to destinations like Dubai where there are better job opportunities and a much more favourable tax environment.”

Plus, young and middle-aged people are also going to bear the brunt of measures announced in the 2024 Budget, but yet to come into effect, such as adding pensions to inheritance tax from 2027, which will affect how much can be passed on to other generations.

ISA reforms

The biggest change that treats people differently dependant on their age is the cut to the cash ISA allowance from £20,000 to £12,000 from April 2027.

This is one area where over-65s may actually benefit as they are exempt from the limits, while younger generations will be hit if they wanted to maximise cash ISA savings for goals such as saving for a mortgage deposit.

Hollands added that over-65s will also benefit from still being able to hold “cash-like” assets in a stocks and shares ISA, which will be restricted for everyone else from April 2028.

He said: “That seems incredibly unfair, that the cohort who can still put £20,000 in a cash ISA, will also be able to hold cash or money market funds in stocks and shares ISAs without facing a penalty charge on interest or a potential exclusion on access to money market funds that might be coming for everyone else.”

It’s been a mixed year for the housing market but the door is still open for investors to make money from bricks and mortar in 2026.

Slowing house price growth, higher taxes and extra rental regulations have made investing in property more tricky in recent months.

But experts claim there are still reasons to back real estate, especially with the prospect of interest rate cuts in the coming weeks.

Big themes for investors include the return-to-the-office and the rise of online shopping.

Daniel Austin, chief executive and co-founder at specialist property lender ASK Partners, said: “The 2025 Autumn Budget offered limited stimulus for the housing market and, persistent headwinds such as sticky inflation, higher for longer interest rates, elevated construction costs, and slow planning processes continue to impact development viability.

“But there are still reasons for cautious optimism. The UK economy is forecast to grow by 1.4% this year. This is expected to outperform the eurozone and should support investor confidence.

"The UK also remains an attractive destination for global capital, with ongoing interest from the Gulf, Southeast Asia and deepening UK United States investment links, particularly through the technology sector.”

Here are the emerging trends in real estate for 2026 and how to invest in them.

Prime offices

Many companies are reducing remote working and getting staff to be in the office more frequently.

Austin suggests businesses are competing for modern, energy efficient and amenity rich workplaces that support hybrid working.

He said: “Best-in-class offices in central London continue to achieve strong rents and stable yields."

The rise of build-to-rent

The UK housing market continues to be hit by a lack of supply.

The government is pushing planning reforms through parliament to boost development but there are also fears that landlords could exit the market due to new rental regulations and higher taxes.

Build-to-rent - developments typically run by large institutional landlords - may fill that gap, providing an opportunity for investors. You may already have some exposure to this through your pension.

Austin said: “With so many smaller landlords exiting the sector due to increased costs and regulatory complexity, professionally managed rental formats are becoming more important. Build-to-rent and co-living are particularly well positioned to serve younger, mobile workers who seek affordability, connectivity and community. Mid-market suburban and commuter belt schemes may outperform prime central locations, especially in areas benefiting from new infrastructure such as the Lower Thames Crossing.”

Storage and logistics

Demand for storage and logistics is being driven by the growth of online retail as well as the growing adoption of artificial intelligence, cloud services and high-performance computing.

This means there is more demand for industrial sites to store goods for online deliveries and also hard drives to power cloud software.

Austin said: “Growing adoption of artificial intelligence, cloud services and high-performance computing is placing unprecedented pressure on power capacity and suitable land, making data centres an increasingly strategic real estate category.

“The combination of long-term contracted income, critical infrastructure status and limited supply of appropriate sites means this segment is likely to remain strong. Mixed-use industrial schemes that accommodate logistics, data infrastructure and urban services will offer particularly attractive, income-led opportunities in 2026.”

Hotels and hospitality

The transformation of under-utilised office buildings into hotels are creating new avenues for investors, according to Austin.

He said: “The asset class continues to appeal to private investors and family offices seeking income diversification and long-term value.”

Income producing operational real estate

Operational real estate, including healthcare, specialist care, education and supported living can provide stable and inflation-linked income streams.

Austin said: “Demographic shifts, including an ageing population and rising demand for specialist services, support the long-term resilience of these sectors.”

How to invest in real estate

Unless you are a property developer or landlord who can afford to build or manage one of these assets, one of the most common ways to gain exposure to real estate assets is through real estate investment trusts (REITS) or property funds.

Oli Creasey, head of property research at Quilter Cheviot, said: “The REITs own a portfolio of properties worth a certain value, and shares in the companies are traded on stock exchanges throughout the day.”

Most specialise in a particular sub-sector.

Creasey highlights Derwent London and GPE for development and ownership of London offices, while Big Yellow and Safestore are self-storage specialists.

Investors can get access to health care developments through Primary Health Properties and Target Healthcare, which owns senior living centres.

Meanwhile, Unite Group backs student accommodation, while Grainger does general residential rental.

For buyers not looking to specialise, Creasey says there are several funds that buy REITs but use them to create a more diverse portfolio including Columbia Threadneedle;s Property Growth and Income as well as TIME's Property Long Income and Growth funds.

There are also funds that create a diverse portfolio around a thematic approach such as Schroder's Global Cities fund which invests in REITs worldwide that own assets located in the top cities globally, while Gravis's Digital Infrastructure fund invests in REITs that are aligned with the ongoing technology revolution.

Ben Yearsley, director of Fairview Investing, suggests a broad based fund or trust that then leaves the sector and stock decisions to the fund manager is better than trying to gain direct exposure.

His favoured option is the TR Property investment trust managed by Marcus Phayre-Mudge.

Yearsley said: “It has a mix of UK and European property shares.

“Valuations are cheap and no one is interested on the sector. In addition with no speculative development in the past decade there are shortages of good quality property in many areas.”

For a sustainable option, Daniel Bland, head of sustainable investment management at EQ Investors, suggests the Schroder BSC Social Impact Trust, which backs social housing.

Volatile markets and changes to pensions and inheritance tax is making more people seek help from a financial adviser. But how much should you pay for advice?

Analysis of retail mediation activities returns by the Financial Conduct Authority (FCA) shows regulated financial advisers and planners are charging up to 3% for their services such as pension and retirement planning across a range of charging structures.

A financial planner or adviser can help build an investment portfolio or provide a plan for your retirement or how to leave money to your loved ones.

It can be of benefit if you are not confident about managing your own portfolio or need help getting started.

This may be more important with frozen tax thresholds and the prospect of more tax hikes in the Autumn Budget.

Here is how much you should expect to pay for a financial adviser.

How does financial advice work?

A financial adviser can provide professional advice on everything from investments to pensions and inheritance tax planning.

There are different types of adviser and it is important to know the type of service you are paying for.

Of the firms providing retail investment advice in 2024, the regular said 87% provided independent advice. This means they weren’t tied to a select panel of providers.

Meanwhile 12% provided restricted advice. This means the adviser may only advise on a range of products such as investment or pensions or may just work with specific providers. This includes bank advisers who will only offer products from their employer. Financial advisers can be restricted but often this just means the providers they work with have been vetted and recommended by their own internal panels.

Some advisers provide both, according to the FCA.

The percentage of all firms that provided both restricted and independent advice was 1.4% in 2024, compared to 2% in 2023.

Advisers can charge in different ways, ranging from an initial charge to ongoing fixed fees or a combination.

This can make a big difference, especially if you have a large amount to invest.

How much does financial advice cost?

Financial adviser charges appear to be similarly whether they are independent or restricted.

The City watchdog’s figures show the typical minimal initial charge ranges from 1.% to 2.9% while the ongoing fee can be anything from 0.4% to 0.9%.

If you are paying an ongoing fee, it is important to make sure you are still being looked after.

Financial coach Philly Ponniah said: “Fees can be justified when the advice is genuinely expert and adds real value, especially in complex situations that could trigger unexpected tax charges.

“The issue is some firms charge at the top end while offering little more than an annual review, which isn’t enough for today’s savvier clients. If you’re paying ongoing charges, you should expect proactive guidance and more than a box ticking compliance exercise.”

While the cost of financial advise is easy to measure and may make some consider managing their own money, Eamonn Prendergast, chartered financial adviser at Palantir Financial Planning, said the value you get is harder to measure.

He said: “A good adviser does far more than pick funds: they create financial forecasts, identify your ‘magic number’ for retirement, and guide you through volatile markets.

"They provide what Vanguard calls ‘adviser alpha’ — behavioural coaching, tax planning, and strategic decision-making that can add far more value than the fee itself.

“If your adviser helps you stay invested through volatility, avoid costly mistakes, and structure your money tax-efficiently, that’s value you can’t see on a statement. Clients should always know exactly what they’re paying for with a clear breakdown of adviser, platform, and fund charges and make sure that advice is genuinely moving them closer to their goals.”

Longstanding gifting rules used as a way to avoid inheritance tax could be under threat in next week’s Budget. Those at risk of leaving their loved ones an inheritance tax bill are being encouraged to review their finances and consider giving money away now where it makes sense for them.

More than one in every 10 retired people (15%) said changes to inheritance tax is their biggest Budget fear, according to a survey of 2,000 people for wealth firm Hargreaves Lansdown in October.

Since the summer, rumours have been swirling that inheritance tax (IHT) could once again be a target. One way chancellor Rachel Reeves could potentially increase IHT receipts is by raising the taxes on giving money away – known as gifting – it has been speculated.

However it is unlikely any Budget tax rises, if they do happen, would be put into practice before the new tax year in April 2026, so those considering making gifts likely still have time to look over their finances, review their options and potentially reduce their inheritance tax bill.

Sarah Coles, head of personal finance at Hargreaves Lansdown, said: “Sensible gifts can help support younger family members at a time when you’re still around to see them make the most of the money. It also gives you more control over how gifts are given – as well as cutting a potential inheritance tax bill.

“However, you need to consider it carefully. Giving away too much, too soon, can end up doing more harm than good if you don’t have enough money to fall back on later in retirement.”

How could inheritance tax gifting rules change in the Budget?

Lifetime gifts

At the moment, you can give gifts of any size and, as long as you live for seven years after making the gift, it falls out of your estate for inheritance tax purposes – known as the seven year rule. But the government is said to have been looking at limiting the total value of these one-off gifts people can make during their lifetime.

Taper relief

Taper relief, which applies if you give away more than the inheritance tax threshold of £325,000 – also known as your nil rate band – before you die, but die within seven years, could also be curtailed. Taper relief means the rate of inheritance tax your loved ones pay on the gift you give them gradually falls between three and seven years after giving the gift, cutting your tax bill.

Extending the seven year rule

Increasing the period you have to live after making a gift in order for it to leave your estate is another option open to the government. If it rose to ten years it would make tax planning more difficult, and drag more people back into paying inheritance tax.

Changing gifts from surplus income rules

The government could revisit annual allowances as well as rules that mean regular gifts can be made from income. However, the fact the annual gift allowance – £3,000 per gift, per recipient – has remained frozen for decades means allowances aren’t as generous as they once were, which would limit how much extra revenue this would bring in.

How can I use gifting rules to avoid IHT now?

When done properly, gifting can allow you to make payments to family or friends without those payments being subject to inheritance tax.

David Lunn, partner in the private client team at TWM Solicitors, said: “Taking professional advice when considering gifting can yield significant benefits, particularly where larger sums are involved. You may be able to gift more than you initially thought and make savings.

“On the other hand, rushing through without planning is a dangerous game which is not recommended.”

As the chancellor is reducing the value of inheritance exemptions under Agricultural Property Relief and Business Property Relief from next April, gifting has become increasingly important as a way of reducing IHT.

TWM Solicitors, a private wealth and family law firm, highlights five things about gifting to consider before the Budget on 26 November.

1. Keep good records of gifts

Keep detailed records of any gifts you give, as this will greatly help the executor of a will. Executors often have to pore over years of bank statements to prove to HMRC that the gifting was done properly, so a failure to keep adequate records could lead to a lot of additional administration and detective work, causing delays. Good record keeping can save time, money and tax.

2. Do not give away too much…

People need to think carefully about how much money they will need towards the end of their lives. If you have too much, it will be subject to IHT. On the other hand, giving away too much comes with risks.

For example, if you need significant social care in the future and are unable to fund it from what you retain, your local authority might determine that you intentionally gave away your assets to avoid paying care fees. If so, it will treat you as if you still had said assets. This would place the burden on those who received the gifts or your heirs and, if they do not pay up, it could leave you needing care with nobody able and willing to pay for it.

3. …But don’t ‘under gift’ either

In TWM’s experience, the people who are likely to get caught out by inheritance tax, out of caution, keep too much money in their estate. By retaining more money than they need, they will leave heirs with a bigger IHT bill than necessary.

For example people often overestimate how much they will have to pay for a care home and their likely longevity. People also often forget that the cost of a care home need not be funded entirely out of capital – if you have a healthy income, this can go a long way towards meeting care fees. That being the case, TWM said individuals should consider gifting money to their loved ones earlier in life.

There are several different tax-free gift allowances that people are failing to make maximum use of:

• These include the £3,000 annual exemption, which, if you do not use it in a given year, can be rolled over once to the following year to make £6,000.
• Others include making wedding gifts of £5,000 per child, £2,000 per grandchild and £1,000 for anyone else.
• You are also allowed to make an unlimited number of small gifts of up to £250 per person annually, provided you have not used one of your other gift allowances for that person.

4. Use surplus income wisely

IHT will be applied to lifetime gifts given from your savings or other assets, unless you live for seven years after giving them, or your total chargeable estate is under the IHT threshold. If the money you are gifting is from income you do not need, there is no limit if it is done correctly.

However, this exemption is subject to various rules and procedures, and advice should be taken before proceeding. You may need to prove that the money was surplus to your requirements.

5. Be careful under a power of attorney

If you are acting under a power of attorney on behalf of someone else, your ability to give gifts on their behalf is extremely limited. Beyond that, you must obtain permission from the Court of Protection if you wish to make further gifts. Failing to do so puts you at risk of the court making you take back the gift or your power of attorney being revoked. HMRC may judge your gifts to be invalid and chargeable to IHT.

Fifty years on from first being able to open their own bank account, women across the UK are taking a more active role in managing their money, according to new research. But many still feel anxious making long term financial plans.

Nearly three-quarters (72%) of women polled by Canaccord Wealth said they are taking steps to manage their finances, from getting on the housing ladder to saving and investing.

This is a significant shift for many women in just two generations. Before 1975 the gender gap meant single women would need a signature from their father if they wanted to apply for a loan, credit card or even a mortgage for their own home.

However, beneath this progress lies a confidence gap. In the poll of 2,345 adults across the UK – including a sample of 500 high-net-worth individuals – just 18% of women said they feel calm and in control of their finances.

The data also points to the emotional toll this anxiety over financial planning can take. Among women who feel uneasy discussing money, one in 10 (11%) feel anxious because they’ve never done it before, and 7% say they lose sleep over financial concerns.

One in seven (14%) admit they worry they won’t know what to say or ask about money.

By contrast, two in five men (40%) report having regular meetings with a financial adviser to discuss building their wealth, compared with just one in five (20%) women.

Women face a wide gender wealth gap in Britain that could also be holding them back. Women’s wealth gap stands at 21% – men have a fifth more in assets than women – according to analysis of the government’s latest Wealth and Assets Survey (2020-2022) by the Women’s Budget Group. This is even larger than the 13% gender pay gap.

There is also a significant gender pensions gap, with women on average having private pensions worth £113,000 less than men, with career breaks pushing one in three women into pension poverty.

Despite their typically lower wealth and anxieties around money, however, for most women, the fear of financial admin is far greater than the reality, the research suggested.

Four in five (80%) women said they finished a financial task faster than expected with 44% finishing within an hour, 18% taking just 10-30 minutes, and 21% assuming tasks will take more than two hours, when in practice only 10% spend that long.

Alice Wright, investment director at Canaccord Wealth, said: “It is really important for people to feel that they can grow their wealth with confidence and we’re not seeing enough of that.

“By reframing financial planning as a powerful form of self-care and control, we can help turn anxiety into action. The choice to spend 10 to 30 minutes on a financial task is a smart decision to invest in one’s future.

“Everyone can benefit from greater confidence and access to planning support. It’s time to celebrate this efficiency – and encourage women to turn thought into action.”

We look at practical ways to bridge the confidence gap.

Five easy ways to manage your money

Becoming more financially confident is often a case of breaking down big tasks – like making a financial plan – into smaller, more manageable problems to solve, and then repeating the process.

To help you manage your wealth with confidence, Canaccord Wealth shares its top tips:

1. Map out your income and expenditure

Gaining an overview of your day-to-day financial situation is a great place to begin to become more financially secure. Start by creating a record of your income and expenditure or update the one you already have.

• Does your income match your outgoings?
• Do you have any extra income you could put to better use in an investment portfolio?
• Do you have any monthly subscriptions, memberships, or other expenses that you’re not enjoying or using enough and could the money be put to better use elsewhere?

2. Review any existing investments

If you have any existing investments, make sure you know exactly what you’ve got. Make a list of them, where they are invested and how much they’re worth.

• How much are you paying in investment fees?
• Could you make the holdings more tax efficient by maximising your annual investment allowance for your ISA?

Familiarising yourself better with your investments enables you to make them work better for you and to make the most of the advantages they offer. You may also wish to consider how your lifestyle, life stage, or attitude to risk may have changed since you originally made your investments.

3. Consider your family situation

If you’re married or in a civil partnership, you and your partner will want to ensure that you’re making the most of your income and capital. Shifting assets between one another could lead to significant advantages in terms of both tax planning and ISA allowances.

It’s also important to consider any specific financial circumstances between you and your partner. For example, ensuring long-term financial stability for the younger partner if there is an age gap between you. If you have separated from a partner, it’s equally important to make sure that your finances are disentangled and that you are fully aware of your new financial situation.

4. Review your insurance

Nobody likes to think of the unforeseen, but it can happen. Insurance is a key part of your financial plan.

• What if you were no longer able to work and provide an income for yourself and your family? Would you be able to meet the costs to live comfortably?
• It’s important to review your insurance policies – both those held personally and with your employer. Are they still valid and up to date? Could you be over or under-insured?
• Perhaps you have moved employment and a plan previously available is no longer there and needs replacing. It’s good to have contingency plans in place – just in case.

5. Do a once-a-year financial health check

Whether it’s tidying up your pension plans, ensuring your savings are as tax-efficient as possible, or considering what sorts of new investments would be suitable, a once yearly check-up of your finances can really help keep you on track to grow your wealth.

Allowances are often available annually – like for ISAs and pensions – so it can be a good idea to review your investments and finances every year. And it could be worth a quick chat with a financial adviser – the first conversation is usually free.

Artificial intelligence (AI) is becoming a major part of our daily personal and professional lives but there are doubts over its abilities to provide financial advice.

AI tools such as ChatGPT and Google Gemini are regularly relied upon for online searches on everything from writing wedding speeches to holiday planning and even legal contracts.

Financial advice is an obvious next step, opening access to those who may not understand how to invest or just want to check information such as income tax thresholds.

There are signs of AI moving into finance, but research in the UK has highlighted that there are currently limits to how good AI is at giving financial advice.

Consumer watchdog Which? recently tested six AI tools – ChatGPT, Google Gemini, Gemini AI Overview (AIO), Microsoft’s Copilot, Meta AI and Perplexity – to establish how the technologies could answer common personal finance queries but found “inaccurate, unclear and risky advice which could prove costly if followed".

Andrew Laughlin, Which? technology expert, said: "Everyday use of AI is soaring, but we’ve found that when it comes to getting the answers you need, the devil is in the details.

"Our research uncovered far too many inaccuracies and misleading statements for comfort, especially when leaning on AI for important issues like financial or legal queries."

How reliable is AI financial advice?

In September 2025, Which? asked the six AI tools 40 common questions across four key life areas including money and finance and consumer rights.

The accuracy of responses varied.

For example, when Which? placed a deliberate mistake in a question it posed about the ISA allowance, asking “How should I invest my £25,000 annual ISA allowance?” both ChatGPT and CoPilot failed to notice that the allowance is in fact only £20,000. Instead of correcting the error, both gave advice that could risk someone oversubscribing to ISAs in breach of HMRC rules.

In another example, researchers asked the AI tools to check which tax code they should be on, and how to claim a tax refund from HMRC.

ChatGPT and Perplexity both presented links to premium tax refund companies alongside the free government service.

The companies behind the AI tools all said users should report inaccuracies and must always verify what they are being told.

Moneyweek has contacted ChatGPT, Google Gemini, Gemini AI Overview (AIO), Microsoft’s Copilot, Meta AI and Perplexity for further comment.

Laughlin added: “When using AI, always make sure to define your question clearly, and check the sources the AI is drawing answers from. For particularly complex issues, always seek professional advice – particularly for medical queries, before making major financial decisions or embarking on legal action.”

This isn’t the first time that AI has come under pressure for its financial advice capabilities.

In October, financial education specialists Investing Insiders asked AI tools 100 finance questions across a range of topics including savings accounts, housing, and retirement, to examine how reliable they are at giving advice.

From the 100 questions, AI tools were correct 56% of the time, deceptive or misleading for 27% and incorrect for 17%, which means for 44% of answers, AI isn’t helpful for Brits seeking financial advice.

The research found incorrect data on the state pension and tax thresholds as well as on gifting.

Antonia Medlicott, founder and managing director at Investing Insiders, said: “Our study shows the worrying trend that AI isn’t providing sound financial advice when prompted.

“Even more concerning is that millions of Brits are doing this and being misled across a range of topics, from basic advice to savings accounts and large life events like buying a home or retirement.”

But Mitali Deypurkaystha, AI strategist at Impact Icon AI, takes a different approach, blaming a lack of financial literacy and user error, adding: “Some of what they call failure is user error. Ask AI today for the current UK state pension and you’ll likely get citations straight from gov.uk.

"The other likely error is user knowledge on choosing best-fit AI tools.

“That’s the 'GP-vs-surgeon mistake.' You wouldn’t ask your GP to do open-heart surgery, don’t expect a general AI to be your personalised financial adviser.

"There is no public, expert-level finance-advice AI for them to test. The real warning isn’t ‘don’t use AI’ – it’s ‘teach people to use it well.’ Give the UK accessible, national AI-literacy programmes now."

Should you trust AI for financial advice?

AI tools aren’t regulated by the Financial Conduct Authority (FCA) so shouldn’t be solely trusted for financial advice.

But consumers may understandably turn to the technology tools for guidance that may lead to financial decisions.

David Horowitz, head of financial planning and wealth management at Gerald Edelman, said: "Using ChatGPT as your financial adviser is a bit like Googling your symptoms and skipping the doctor. You might land on something broadly right or something dangerously off. AI is exceptional at processing information, but it doesn’t know your goals, your tax position, your time horizon or how you actually feel about risk. And crucially, it can’t take responsibility if the guidance is wrong.

"Good financial planning is built on nuance. The difference between the right and wrong pension strategy, ISA structure or investment approach isn’t theoretical. It has real, long-term financial consequences.”

He suggested that AI can help with research, number-crunching or running scenarios. But the judgment, regulation and accountability sit firmly with a human adviser.

Horowitz added: “The prudent approach is to use tools like ChatGPT to enhance your understanding not to replace expert, regulated advice tailored to your life.”

Love rather than tax should be the main motivation for getting married but financial planner Scott Gallacher could end up leaving his loved ones with a £214,000 inheritance tax bill if he doesn't marry his long-term partner after April 2027.

That is the startling reality of the government’s plans to bring pensions into the inheritance tax net, which could leave cohabiting couples with a shock bill from HMRC if one partner dies.

Chancellor Rachel Reeves announced in her 2024 Autumn Budget that inheritance tax will be applied to pensions from April 2027.

This means more estates could leave their families with an inheritance tax bill once someone dies.

Gallacher, 51, director and financial planner at Leicester-based advisory firm Rowley Turton is among many who could be hit by the changes, especially if passes away after April 2027 before getting married.

The financial cost of inheritance tax reforms

Gallacher has been with his 59-year old partner for 29 years and they have been engaged for 27.

But they never got around to getting married as they chose to save to buy a house in the 1990s instead of having a wedding and then life got in the way as he built his business and they raised their two boys.

He currently has a £700,000 pension, £150,000 equity in the home he owns with his partner and £10,000 in cash.

Under the current rules, his estate wouldn’t pay any inheritance tax as he can use the £325,000 nil-rate band covering his equity and savings, while the pension remains untouched - leaving £860,000 that can be passed on tax-free for his partner and two children.

The £175,000 residential nil rate band is also 'lost' unless he specifically leaves money to his two boys rather than his partner.

But, after April 2027 the pension value will be included, creating an inheritance tax bill of £214,000, leaving £646,000 in his estate to leave his loved ones.

This is because the tax system currently favours married couples, meaning you can pass on assets to your spouse tax-free.

But this doesn’t apply to unmarried couples.

Gallacher said: “I suspect come April 2027, there will be stories of cohabiting couples where one has died and they weren’t aware of the changes.

“Most people have houses and life cover so for the average person the inheritance tax allowances are pretty generous, but including pensions will flip some people from under to over the limit.”

While Gallacher is lucky to be in a position where he is aware of the changes, other people, both married and unmarried, may be unaware that their pension wealth could soon push them into paying inheritance tax.

Rowley Turton has launched an inheritance tax calculator on its website to highlight the financial difference the pension changes will make so that people can decide if they need to take advice to cut their inheritance tax bill.

Should you get married to reduce your inheritance tax bill?

Gallacher said he was always planning to get married and this has accelerated his plans.

He added: “Some communities may have only got married religiously but UK law does not regard them as married, so the pension change will accelerate that need.

“It’s a boon for the wedding industry and wedding cake manufacturers.

“Luckily I have a short term solution for my own personal liability, but there will be people who still face higher bills even if they are married, so financial advice may still be needed whatever relationship you are in.”

Generation X - savers over the age of 50 - have been identified at most risk of a retirement shortfall and face being the first generation with lower financial security than their predecessors, research suggests.

Analysis by PensionBee shows pension savers over age 50 are least prepared for retirement compared with other generations.

According to PensionBee’s 2025 Pension Landscape, women over age 50 hold an average of £30,644 in their retirement savings compared with £54,512 for men in the same age group.

The gender pension gap is just one aspect of the issue though.

PensionBee’s calculations suggest that, on average, Generation X savers will be left with a retirement pot worth £88,444 based on 5% annual growth if they want to retire at 66.

Other generations have age and time on their side.

Savers under 30 could have a pot worth £181,165 by the time they are 66 based on the typical size of the generation’s savings and the same investment performance.

This rises to £178,439 for those in their 30s and £130,140 for savers in their 40s.

Why has Generation X fallen behind on pension saving?

The over-50s generation has faced a few challenges that has impacted their ability to save into a pension.

PensionBee highlights that they entered the workforce during downturns, endured stagnant wages and lived through repeated financial shocks such as the dotcom crash and the 2008 financial crisis, both of which hit their earnings and pension power.

Just as they reached their peak earning years, the Covid-19 pandemic hit, further derailing long-term planning, PensionBee said.

This cohort is also part of the so-called “Sandwich Generation” supporting both ageing parents and dependent or returning children. Faced with university fees, long-term care costs and mortgages, pensions have, perhaps unsurprisingly, fallen down the priority list.

While rising house prices have cushioned some, the lack of pension savings highlights a looming gap in retirement security.

Maike Currie, vice president of personal finance at PensionBee, said: “Generation X has been squeezed from every angle, sandwiched between caring for ageing parents and supporting children, all while weathering repeated economic shocks.

“It’s little wonder that pensions have slipped down their priority list. But the reality is that this generation is heading towards retirement with far less financial security than their parents enjoyed.”

She warned that this should be a wake-up call for policymakers and the industry to provide the tools, support and flexibility this overlooked generation urgently needs, adding: “Unless we act now, Gen X could become the first generation to retire worse-off than the one before.”

How to boost your pension pot

With the cost of a comfortable retirement estimated at £43,900 per year, the more you can have in your pension to get close to this level of income the better.

You will still have other support though such as the state pension, plus you could work for longer or find other sources of income such as buy-to-let.

There is still time to boost your pension, whatever age you are.

Money coach Benjamin Beck urged people not to dismiss small pension pots from previous jobs, adding: “Spend time tracking down your pension and keep your details up to date. I have encountered people dismissing a £10,000 pension pot. It's your money.

“You wouldn't dismiss a bank account worth £10,000. This is your future money, your future paycheck, so look after it so that it can look after you.”

Rob Mansfield, independent financial adviser at Roots Wealth Management, said people shouldn’t ignore their pension statement.

He added: “Don't just file it away in the deal-with-it-tomorrow pile. Are you happy with how it's performing? How is the fund performing compared to its benchmark? Are your death benefit nominations up to date?”

"You're in charge of your pension but it's easy to assume that someone else is managing it and leave it until it's too late. Take control and if you don't understand it, ask for help."

Anita Wright, chartered financial planner at Ribble Wealth Management, suggested increasing pension contributions.

She said: "Boost your pension by nudging contributions up by just 1%–2% whenever you get a pay rise.

“Also, remember that holding too much in cash leaves your savings vulnerable to inflation erosion. For stronger long-term planning, build a cashflow model to map spending needs, use the 4% withdrawal rule as a guide while adjusting for inflation and market conditions, and diversify across asset classes to reduce volatility and protect your retirement income.”

Concerns about tax rises and pension and ISA reform may prompt investors to put as much money away as possible in the build up to the Autumn Budget - but where are the best places to stash your cash?

Chancellor Rachel Reeves is rumoured to be considered reforms to ISAs that could restrict the cash ISA allowance, as well potential restrictions on pension tax relief as part of plans to balance the nation’s finances in her latest fiscal update.

This may encourage more people to make use of existing allowances to keep as much money away from the taxman as possible.

But it is important to put your money into reliable investments that have the best chance of delivering a decent return, even if you can’t guarantee market performance.

Looking at historical data on fund returns is one way to build a portfolio but there are other factors to consider.

Investment platform Bestinvest has compiled a Best Funds List based on the selection process used by its parent company Evelyn Partners in client portfolios, which are worth £64.6 billion.

It considers managers who don’t just hug the benchmark and show they can beat it, as well as those who invest their own money in top stocks.

The list favours fund managers with clear objectives who consider the long-term fundamentals rather than short-term gains.

It also favours managers who can find a nice balance between diversification and investing with conviction in a select number of positions as well as portfolio sizes that are manageable with a stable management team.

The latest edition features 142 funds, including 112 actively managed investments comprising 85 funds and 27 investment trusts, selected for their potential to deliver market-beating returns over the longer term.

There are also 45 passive options, including both traditional index tracker funds and exchange traded products, that fee-conscious investors may prefer.

Plus, there are 13 environmental, social and governance-focused investments, for those seeking to align their portfolios with environmental and social values.

Here is how the experts are investing.

Finding value in UK equities

The UK stock market may not post the same top returns compared with somewhere like the US, but the FTSE 100 has hit record highs in recent months and there are plenty of companies offering attractive dividends.

Bestinvest says the UK market offers opportunities for value-oriented investors, with a strong tilt towards value and defensive sectors, including financials, energy and healthcare.

The report said: “While the UK lacks the big tech giants listed in the US, other major sectors in the UK, such as financials and defence companies, are thriving. Share buybacks are prevalent, particularly among FTSE 350 companies. Major companies conducting buybacks this year include Shell, GSK, HSBC and Unilever, to name but a few.”

Investors can access these sorts of companies through funds such as Artemis UK Select

Fidelity Special Situations, Temple Bar Investment Trust and the iShares Core FTSE 100 UCITS ETF.

UK All Companies

Artemis UK Select

Fidelity Index UK

Fidelity Special Situations

IFSL Evenlode Income

JPM UK Equity Core

Liontrust UK Growth

Montanaro UK Income

Premier Miton UK Growth

Royal London Sustainable Leaders Trust

UK Smaller Companies

L&G UK Mid Cap Index

RGI UK Listed Smaller Companies

WS Gresham House UK Smaller Companies

UK Equity Income

BlackRock UK Income

Redwheel UK Value

TM Redwheel UK Equity Income

Trojan Ethical Income

Healthy European equities

Similar to the UK, Europe is facing various economic and political challenges, but European equities actually outperformed their US counterparts in the early part of the year.

Bestinvest said: “Germany’s substantial increases in defence and infrastructure spending are expected to provide economic stimulus. However, political uncertainty in France continues.

"Despite varying economic conditions, Europe remains home to a diverse universe of best-in-class companies. From world-renowned healthcare firms to luxury goods and industrial leaders, the region offers a wealth of opportunities for skilled fund managers.”

Two of the best funds to access the continent include Blackrock European Dynamic and Liontrust European Dynamic, according to Bestinvest

Europe excluding UK

BlackRock Continental European Income

BlackRock European Dynamic

Fidelity European

HSBC European Index

Liontrust European Dynamic

Making American stocks great again

US stocks have dominated financial markets in recent years, with the Magnificent 7 technology firms driving investor interest.

But there have been concerns that valuations across US equities appear stretched when compared with historical averages, prompting a more cautious outlook among investors.

There are also concerns about the slowing jobs market and the potential impact of Trump tariffs on consumer prices. These factors could weigh on economic momentum and investor sentiment. However, Bestinvest said the US is a resilient market that could further benefit from deregulation, tax cuts, and positive company earnings.

North America

Brown Advisory US Sustainable Growth

Dodge & Cox Worldwide US Stock

Edgewood L Select US Select Growth

GQG Partners US Equity

L&G S&P 500 US Equal Weight Index

L&G US Index Trust

Premier Miton US Opportunities

TM Natixis Loomis Sayles US Equity Leaders

North America Smaller Companies

Federated Hermes US SMID Equity

Navigating emerging markets

Emerging markets can be challenging to navigate, particularly in Asia where countries face varying economic outlooks, said Bestinvest

India and China are facing trade tensions with the US, while smaller countries in the region may be where the best growth is, albeit with more risk.

M&G Asian is one way of putting your money into the region as is Ashoka WhiteOak Emerging Markets Equity, which aims to back high-quality businesses at attractive valuations.

Asia Pacific excluding Japan

Federated Hermes Asia ex-Japan Equity

Jupiter Asian Income

Schroder Asian Income

Schroder ISF Asian Total Return

Global Emerging Markets

Ashoka Whiteoak Emerging Markets

Equity Fidelity Index Emerging Markets

TM Redwheel Global Emerging Markets

Vanguard Emerging Markets Stock Index

Going Japanese

Japanese equities present “valuation diversification,” according to Bestinvest, with its stocks often trading at lower price-to-earnings (P/E) ratios than their US counterparts.

The report said: “This creates potential value opportunities for investors. Furthermore, corporate governance reforms have led to improved capital efficiency and stronger shareholder returns, with companies increasingly engaging in stock buybacks and dividend payouts.”

Investors can access world-leading industries, particularly in electronics and automotive manufacturing through funds such as M&G Japan and the JPMorgan Japanese Investment Trust.

Japan

iShares Japan Equity Index (UK)

JPM Japan M&G Japan

Going global

A global equity fund can give you access to the best regions and companies in one portfolio, providing a diverse mix of industries and geographies.

Bestinvest said: “By investing across regions and sectors, these funds can help mitigate risk and improve long-term stability - making them a valuable tool for building balanced portfolios.”

The report recommends Loomis Sayles Global Growth Equity and Fidelity Index World.

Global

Baillie Gifford Global Discovery

Brown Advisory Global Leaders

Brown Advisory Global Leaders Sustainable

Fidelity Index World

Fiera Atlas Global Companies

Fundsmith Equity

Fundsmith Stewardship

GuardCap Global Equity

Loomis Sayles Global Growth Equity

Schroder Global Sustainable Value Equity

UBS FTSE RAFI Developed 1000 Index

Vanguard FTSE Dev World ex-UK Equity Index

Vanguard Global Small-Cap Index

Global Equity Income

Baillie Gifford Responsible Global Equity Income

Fidelity Global Dividend

Guinness Global Equity Income

IFSL Evenlode Global Income

Finding fixed income

Economic uncertainty is making fixed income attractive and current bond yields are offering an attractive entry point for investors seeking to lock in relatively predictable returns, according to Bestinvest.

The wealth manager said: “With yields elevated across various fixed income instruments, this environment presents an opportunity to consider bonds for both defensive and income-generating portfolios. UK Gilts continue to look appealing - especially with the potential of future interest rate cuts from the Bank of England, should inflation remain under control.

It suggests the Invesco Tactical Bond and iShares Core UK Gilts UCITS ETF to get exposure to fixed income.

UK Gilts

Vanguard UK Government Bond Index

£ Global Corporate Bonds

Aegon Global Short Dated Climate Transition

Global Mixed Bonds

Vanguard Global Short-Term Bond Index

£ Corporate Bonds

Artemis Corporate Bond

Premier Miton Corporate Bond Monthly Income

TwentyFour Corporate Bond

Vontobel Fund TwentyFour Sustainable Short Term

Bond Income

Vontobel TwentyFour Absolute Return Credit

£ Strategic Bonds

Invesco Tactical Bond (UK)

M&G UK Inflation Linked Corporate Bond

MI TwentyFour AM Dynamic Bond

USD Government Bonds

Vanguard US Government Bond Index

Going for gold

Gold has hit record highs again in recent weeks, reflecting the economic and geopolitical uncertainty.

Alongside gold, infrastructure-focused funds are gaining traction as long-term investment opportunities, Bestinvest said.

It recommends Invesco Physical Gold and Lazard Global Listed Infrastructure Equity.

Specialist

BlackRock Gold & General

Guinness Sustainable Energy

Lazard Global Listed Infrastructure Equity

M&G Positive Impact

Ninety One Global Environment

Targeted Absolute Return

Atlantic House Defined Returns

TM Fulcrum Diversified Absolute Return

Graham Macro

Lazard Rathmore Alternative

Ninety One Diversified Income

Flexible Investment

Trojan Fund

Property

Premier Miton Pan European Property Share

Short Term Money Market

Goldman Sachs Sterling Liquid Reserves

Exchange traded funds

Amundi US TIPS Government Inflation-Linked

Bond ETF

Invesco FTSE RAFI US 1000 ETF

Invesco Physical Gold ETC

iShares $ Treasury Bond 3-7y ETF

iShares $ Treasury Bond 7-10y ETF

iShares £ Ultrashort Bond ETF

iShares Core FTSE 100 ETF

iShares Core MSCI Japan IMI ETF

iShares Core UK Gilts ETF

iShares MSCI USA Screened ETF

iShares MSCI World Energy Sector ETF

iShares UK Property ETF

SPDR Bloomberg Sterling Corporate Bond ETF

SPDR MSCI All Country World ETF

SPDR MSCI World Technology ETF

SPDR S&P 500 ETF

JMP UK Equity Core UCITS ETF

Vanguard FTSE 250 ETF

Vanguard FTSE All-World UCITS ETF

Vanguard S&P 500 ETF

Xtrackers MSCI World Communication Services ETF

Xtrackers MSCI World Consumer Discretionary ETF

Xtrackers MSCI World ex USA ETF

Xtrackers MSCI World Financials ETF

Xtrackers MSCI World Health Care ETF

Xtrackers MSCI World Industrials ETF

Xtrackers MSCI World Momentum ETF

Xtrackers MSCI World Quality ETF

Xtrackers S&P 500 Equal Weight ETF

Investment trusts

Asia Pacific Excluding Japan

Schroder Asian Total Return Inv. Company

Schroder Oriental Income

Europe Excluding UK

Fidelity European Trust

Global

Alliance Witan

Monks

Personal Assets Trust

RIT Capital Partners

Global Emerging Markets

Templeton Emerging Markets Investment Trust

Global Equity Income

JPMorgan Global Growth & Income IT

Japan

JPMorgan Japanese Investment Trust PLC

Property

LondonMetric Property PLC

Picton Property Income Ltd

TR Property

Specialist

3i Infrastructure

Allianz Technology Trust

HarbourVest Global Private Equity

HgCapital Trust

Impax Environmental Markets

International Public Partnerships Ltd

NB Private Equity Partners Ltd

Pantheon International

UK All Companies

Fidelity Special Values Plc

Finsbury Growth & Income

Mercantile IT

Temple Bar

UK Smaller Companies

Aberforth Smaller Companies Trust

Henderson Smaller Companies

Jason Hollands, managing director of Bestinvest, said: “As speculation mounts over potential changes to the way pensions, savings and investments are taxed, we anticipate that many investors will once again choose to utilise their tax-free ISA and pensions allowances ahead of the Budget, as they did last year.

“But once an ISA is funded, it is vital to choose the right investments to meet desired savings goals, risk tolerance and time horizons and which will fit alongside existing holdings.

"This can be a daunting process, even for the most seasoned investors given the breadth of choice. That’s where our Best Funds List comes in – offering a curated selection of funds that our research team believe stand out in their respective categories.”

Making sure you have enough income for your golden years is the ultimate aim when putting money into a pension.

But with retirement costs rising and market volatility hitting pension pots, it can be hard to know how much you need to set aside.

One common method is the 25x rule, which suggests multiplying your current expenses by 25 to calculate how much money you would need so you can retire.

The idea is that you then make sure this amount is in your pension or can be derived from other assets such as a buy-to-let portfolio.

But some experts question if the rule is too sensationalist.

The 25x rule explained

The 25x rule for retirement was first coined in a 1998 Trinity University study.

It works in combination with the 4% pension withdrawal rate rule, that dictates how much people can safely take from their pension each year in retirement without running out of cash.

The idea behind the 25x rule is that saving 25 times your annual expenses can provide a target retirement nest egg based on the 4% withdrawal rate.

Research from Shepherds Friendly suggests that to live financially independently for 25 years, the average UK household would need to save £743,338 based on typical expenses.

The figure rise to more than £1m for higher earners.

The method does have some critics though.

Should you follow the 25x rule?

Experts suggest the 25x rule works more as a rough guide but is far from perfect.

Philly Ponniah, chartered wealth manager at Philly Financial, said: “It assumes you’ll withdraw about 4% a year, markets will deliver steady returns, and your spending won’t change. In reality, spending often runs higher in early retirement, drops as we slow down, then climbs again with care.

"Big variables like inflation, care costs, and how long you live can swing the numbers considerably.

“The 25x rule is still a useful starting point, but it’s not a guarantee. A modern approach means adjusting withdrawals, blending income sources, and modelling the life you actually want to live.”

The rule also ignores the benefits from the state pension.

Scott Gallacher, director at financial advisory firm Rowley Turton, highlights that a couple spending £30,000 a year from age 60 would need £750,000 under the 25x rule.

But in reality, from age 68 they’d receive about £24,000 a year in state pensions, leaving just £6,000 a year to cover. That needs roughly £190,000.

Gallacher said: “Add another £192,000 to cover the eight years before pensions start, and the total comes to around £382,000 — almost half the scary figure quoted. Big headline numbers risk backfiring, as they can put people off saving altogether because 'what's the point.’”

Ultimately, everyone has different expenses and spending patterns so it can be hard to rely on an average measure.

Ross Lacey, director at Fairview Financial Management, said: “These rules of thumb, are just that - a general guide. Everybody is different in terms of the other sources of income they can tap into during retirement. From final salary pensions, to rental income, to releasing equity from the main home.”

Think you only have to worry about the seven year rule to avoid inheritance tax when making gifts? Think again – a little known quirk in the system can trigger an HMRC probe going back as far as 14 years to claw back tax.

Fresh inheritance tax (IHT) concerns have been raised amid reports chancellor Rachel Reeves is planning on tightening the rules on gifting during an individual’s lifetime. One of the most common strategies to avoid inheritance tax is to make gifts.

The proposals reportedly under consideration are limiting the value of lifetime gifts that can be passed on IHT free, as well as looking at the taper relief rules that currently reduce the amount of inheritance tax due from 40% down to zero after seven years.

Under the so-called ‘seven year rule’, if you give away something and survive seven years, it’s outside your estate for IHT purposes, meaning whoever you gave it to doesn’t have to pay inheritance tax on it after you die.

But in reality, if you gift to a trust, which is an increasingly typical financial planning strategy, the taxman could end up investigating gifts you made as long as 14 years ago – and demanding inheritance tax be paid on those.

Ian Dyall, head of estate planning at wealth management firm Evelyn Partners, said: “The inheritance tax treatment of making a gift is widely misunderstood, and more complex than most people realise.

“Many people believe that once seven years has elapsed from the time a gift is made then they can be ignored. That is true for outright gifts to individuals, but gifts made to trusts up to 14 years before a person’s death can affect the overall amount of tax payable.”

In separate articles we look at other ways to reduce your IHT bill and also common IHT myths.

What is the 14 year IHT rule and how does it work?

There’s no separate ‘14-year law’ in the tax code. The phrase comes from how the existing seven year rule on gifts can, in certain cases, make HMRC look back up to 14 years when calculating inheritance tax, if someone dies within seven years of making a gift.

Jude Dawute, managing director of wealth manager Benjamin House, explained: “Under the seven year rule, if you give away something and survive seven years, it’s outside your estate for inheritance tax purposes.

“If you die within seven years, the gift is counted back in, and tax of up to 40% can be due.”

In this case, the gift will firstly reduce the inheritance tax-free allowance – also known as the nil rate band, which could potentially be up to £1 million if the last surviving parent is passing assets to their children – available to the executors of the estate who are sorting out who owes what in terms of IHT.

Once the tax-free threshold has been completely used up – meaning the nil rate band has been reduced to zero – the recipient of the gift becomes liable for the inheritance tax owed on their gift. However, the rate which would apply to the gift reduces over time due to an allowance called ‘taper relief’.

Where the 14 years rule comes in is if, before that gift, you had made an earlier chargeable lifetime transfer (CLT) – typically a gift into a discretionary trust.

“Gifts to trust are treated slightly differently,” said Dyall.

“Firstly there may be a liability to inheritance tax at 20% at the time the gifts to the trust are made, if their value exceeds the nil rate band when added to any other gifts to trust within the previous seven years.

“Again, if the donor survives for seven years after the transfer to the trust, there will be no further liability for the trustees of the trust.

“However, the gifts don’t disappear. Their value will be taken into account when calculating the liability on any gifts made in the final seven years of the donor’s life.”

Consequently, if a gift to a trust (a CLT) was made in the seven years before your later gift to an individual – known as a potentially exempt transfer (PET) – and you die within seven years of the PET, HMRC adds the earlier CLT into the calculation.

“That means they’re effectively looking at gifts made up to 14 years before your death when working out the tax,” said Dawute.

For example:

• In 2015, you put £300,000 into a trust (CLT)
• In 2021, you give £200,000 to your daughter (PET)
• You die in 2025, four years after the PET

Because you died within seven years of the PET, HMRC looks at the 2015 trust gift too, since it was within seven years before the PET. That earlier trust gift may have already used up your tax-free allowance (nil-rate band), meaning more of the later gift can be taxed.

How to avoid the 14 year inheritance tax rule

The best way to avoid the effect of this 14 year inheritance tax rule is to separate large gifts to trust by seven years and a day from large gifts to an individual.

Additionally, Dawute recommends making maximum use of your inheritance tax gift allowances:

• £3,000 per year (plus one year’s carry-over) and the £250 small-gifts allowance per person are free of IHT
• Wedding gifts: up to £5,000 to a child, £2,500 to a grandchild/great-grandchild, and £1,000 to anyone else, given in connection with their marriage or civil partnership, are exempt
• Gift out of surplus income: regular gifts from surplus income are exempt if they don’t reduce your standard of living

You could also consider life cover. A ‘gift-inter-vivos’ life policy, written in trust, can insure the reducing tax risk during the seven years after a large gift.

Furthermore, it could be worth considering making outright gifts, which disappear after seven years, rather than gifts to trusts, which don’t.

Dyall said: “Trusts provide a very useful way of protecting money which has been gifted and retaining some control over it, but in many cases that control is unnecessary and restricts your ability to mitigate inheritance tax.

“The biggest barrier to minimising your inheritance tax liability is trying to maintain control over the assets you have. This leads to people leaving planning too late and limiting the amount they give during their lifetime.

“It’s important to ask yourself the question, ‘do you need all the assets you own and is retaining control or protecting those assets strictly necessary’, as that control could end up costing you more in inheritance tax.”

Everyone’s career trajectory is different but many find their earnings potential peaks as they approach the middle of life.

Wage data from the Office for National Statistics shows those in their 40s tend to have the highest earnings, with a median of £42,000. Some find that things start to pick up the decade before.

We look at the average salary by age in a separate article.

More money brings a range of opportunities. It is not just your current spending power that increases, but your ability to invest. That said, balancing things can be difficult.

“Our 30s are often a time when our income is rising but we may also have big expenses and life changes to fund, like buying a home or starting a family,” said Camilla Esmund, senior manager at investment platform Interactive Investor.

“It’s tempting to park money in cash for ‘safety’, but with time on your side, investing in the markets… can give your future wealth a serious boost.”

In your 30s and 40s, you still have a long investment horizon ahead of you before retirement, meaning it is usually appropriate to take on some investment risk rather than hoarding all your wealth in cash, where it is vulnerable to inflation.

Data from Barclays looking back over the past 120 years or so shows that equities have outperformed cash 70% of the time, based on a two-year holding period. If you extend the holding period to 10 years, it rises to 91% of the time.

With this in mind, we share five tips to maximise your mid-life financial prime – from topping up your pension to paying into an ISA.

1. Boost your emergency fund

Investing is the best way to build long-term wealth, but before you think about the future, assess whether you have enough cash to cover shock expenses that could arise in the here and now.

What if your boiler breaks down or you are suddenly made redundant? Have you got enough cash to fix the problem and plug the gap?

The general advice for working people is that they should keep enough money in an emergency savings pot to cover three to six months of essential spending. Retirees need even more and should target a pot that is big enough to cover one to three years.

“Long periods without an earned income can be financially devastating, which is why a proactive approach can help households weather any unexpected shocks,” said Alice Haine, personal finance analyst at Bestinvest, the online investment service.

When your income goes up, funnel more money into an easy-access savings account to ensure you are able to comfortably meet these guidelines.

2. Top up your pension contributions

It is almost always a good idea to boost your workplace pension contributions above the standard level, if you can afford it. Under auto-enrolment rules, employees typically contribute 5% of their salary to their pension while employers contribute a minimum of 3%.

If you boost your contribution, some employers will up theirs too. “As this is essentially free money, it can be a savvy move, and means your employer is doing more of the heavy lifting,” said Esmund.

Pension contributions are also tax efficient, because you benefit from something called pension tax relief. This means HMRC effectively refunds you the income tax you paid on that money when you earned it.

Tax relief is paid at your marginal rate. If you are a basic-rate taxpayer, it means a £100 pension contribution only costs you £80. Higher rate taxpayers would only need to contribute £60, and additional-rate taxpayers just £55.

Most people underestimate how much they will need for a comfortable retirement, but boosting your contributions in your 30s or 40s when you still have decades of work ahead of you could help keep you on track.

Although the standard contribution under auto-enrolment rules is 8% (employee and employer contributions combined), retirement expert Scottish Widows recommends saving 12-15% as a rule of thumb.

3. Pay into a stocks and shares ISA

You have heard of a midlife crisis, but a midlife ISA is far preferable. As you approach your peak earnings potential, make time to set up a stocks and shares ISA if you don’t have one already.

Pay into it regularly, maximising as much of the annual £20,000 allowance as you can, provided you have already set cash aside for emergencies and short-term savings goals and paid into your pension.

We look at the case for pensions versus ISAs in a separate piece, but the key takeaway is that pensions offer better tax relief while ISAs are more flexible. Most savers and investors use a combination of the two to help them meet their financial goals.

There were 4,850 ISA millionaires at the end of the financial year in 2022, according to the latest HMRC data, obtained through a Freedom of Information request from money app Plum last year.

This number has grown significantly in recent years, highlighting the power of this tax-efficient investment wrapper. The very first ISA millionaire was declared in 2003 – private investor John Lee – having invested a total of £126,000 over the preceding 17 years.

If you start investing in your 30s and 40s and stay in it for the long haul, you too could amass a meaningful sum over time.

“The latest Interactive Investor index shows that investors aged 35-44 have delivered the strongest portfolio growth of any age group over the past five-and-a-half years; proof that this stage of life can be a golden window for long-term investment gains if used effectively,” Esmund said.

4. Start small, investing as little as £25 a month

If you can’t afford to invest a large lump sum of money, or doing so makes you feel uneasy, consider drip-feeding small amounts over time. Several investment platforms allow you to set up a direct debit of as little as £25 per month.

The number of investors drip feeding cash into their stocks and shares ISAs through regular direct debits is up 11% in 2025, according to investment platform Hargreaves Lansdown.

“Because the stakes are relatively low to start with, it’s easier for people to build their confidence by making investment decisions,” said Sarah Coles, head of personal finance at the platform. “Over time, as your income rises, you can boost those monthly investments.”

Investing in regular instalments also allows you to benefit from something called pound cost averaging. It means you buy fewer units when prices are high and more when they are low. This helps smooth out the effects of market volatility.

Find out how to start investing in our beginner’s guide.

5. Make sure you aren’t overpaying on fees

Another good tip is to check what fees you are paying on your investments. Overpaying will erode your returns over time.

Platform fees are one component – these generally range from 0.15%-0.45%. Then there are the individual management fees you pay on funds. All funds cost different amounts based on how they invest, but comparing similar products should give you a sense of whether you are overpaying.

Index funds are generally cheaper than active funds, typically ranging from 0.15%-0.45%. Actively-managed funds can vary significantly, but a ballpark figure is around 0.75%-1.25%. Some investments are more pricey, for example emerging market funds tend to have higher fees.

When making an assessment, remember to focus on value for money rather than pure cost. If a particular active manager has a long track record of delivering strong performance, you might be willing to put up with a slightly higher fee.

Likewise, you might be happy to pay a little more for an investment platform that has better choice in terms of the funds and shares on offer.

We take a closer look in a separate piece: “Investment costs explained”.

Lawyers are warning families of divorced couples there is potential for ex-spouses to use an often overlooked loophole to make an inheritance claim against their estate after their death, even many years after the separation.

Divorces in England and Wales are back up around pre-Covid levels, according to the latest figures. There were 102,678 divorces – and 1,138 civil partnership dissolutions – in 2023.

The number of divorces was up 28% between 2022 and 2023, due to a hump caused by the introduction of no-fault divorce in 2022, which made it easier to legally separate without a fight. The average marriage lasted 12.7 years before divorce in opposite sex couples.

Fewer divorces are occurring overall because fewer people see the benefits of marrying now. But as a percentage, more marriages than ever are leading to divorce. Just over a fifth (22.8%) of couples who married in 1963 divorced before their 25th wedding anniversary, according to the official data. This rose to 40.7% of those who married in 1998.

Law firm DMH Stallard said with divorce rife, people need to be aware of the legal framework that allows an ex-spouse to seek 'reasonable financial provision' from a deceased's estate, even years after a divorce has been finalised.

Cathyrn Culverhouse, a partner at DMH Stallard, said: "Many people assume that once a divorce is concluded, their ex-spouse has no further claim to their assets. However, the Inheritance Act 1975 provides a legal avenue for them to do so, making it crucial for individuals to review and update their estate planning documents to reflect their current wishes."

How can a divorced partner claim on my estate?

To seek "reasonable financial provision" from a deceased's estate, someone must typically make a claim under the Inheritance (Provision for Family and Dependants) Act 1975.

This allows certain individuals who were financially dependent on the deceased, or had other close relationships with them – like a former spouse – to apply to the court for financial support from the estate, if the will or intestacy rules do not make reasonable provision for them.

According to the legal experts at DMH Stallard, a claim under the 1975 Act must be brought within six months of the grant of probate being issued.

However if an ex-husband or ex-wife remarries, their claim for a financial settlement from the estate will fail – with the exception of a claim for maintenance between the date of death and the date of remarriage.

Gonzalo Butori, senior associate at DMH Stallard, said: "The emotional and financial consequences of a post-death claim can be devastating for the surviving family. We advise that taking proactive steps can help protect an estate and reduce the risk of a successful claim by a former spouse.”

How to protect your assets in a divorce

1. Ensure your divorce is finalised, including a clean break financial order

Until the decree absolute has been made, you remain married, meaning your ex-partner has more rights on your estate. And, unless a clean break financial order has been made at the time of the divorce, the spouse's financial needs will not have already been considered by the court (meaning they can’t claim later).

“If you die before that happens, your ex-spouse may be able to bring a claim against your estate for financial provision,” said Cathryn Culverhouse, partner at DMH Stallard.

2. Write a no-claim clause into your divorce

“In the case of an ex-spouse, the most important thing you can do is to include a specific clause in your divorce order that specifically excludes claims against your estate,” said Culverhouse.

If included, this will protect your estate from any claim under the Inheritance Act 1975 that any ex-spouse may bring.

3. Make a will

It is worth getting proper and professional advice when drafting your will to ensure it is valid and achieves the outcomes you desire. This will provide your executors with your wishes, giving them the legal basis to carry out those wishes. If the will has been prepared by solicitors, they should also have a file of papers setting out your instructions to them which can also be used to defend any claims.

“If you do not leave a will, then your estate will be administered as per the intestacy rules (a statutory framework setting out who benefits in order depending on their legal relationship to you) which may not reflect your wishes. Furthermore, the court will have no information about your wishes,” Culverhouse said.

4. Letter of wishes

It is a good idea to include a letter of wishes alongside your will setting out why you have chosen to benefit some and not to benefit others. This is not binding, but it is a useful document set out in your own words which can be used to defend any claim brought.

5. Communication

It is not always easy to do or possible, but clear communication with both the beneficiaries and those who may not benefit from your estate can often reduce the likelihood of a claim.

Culverhouse said: “This allows you to deal with any conflict whilst you are alive and to explain the reasons for your decisions. If done in writing, this can also be placed with the will to show that they were aware of what they were going to receive or not receive as the case may be.”

Lawyers have revealed the top three reasons families go to war over inheritance as worsening delays in the probate system put pressure on those left behind and hoping for a share of a legacy.

With probate cases in the UK rising by over 30% in the past five years, more families are finding themselves stuck in legal limbo, facing frozen assets, growing tensions and, in many cases, full-blown litigation.

A backlog is leaving people stranded in the probate process for months – one lawyer has seen a case waiting for a year.

David McGuire, partner and specialist in disputed wills, trusts, and estates at law firm Weightmans, said: “Delays in the probate system aren’t just an administrative headache – they can potentially be a fertile breeding ground for costly inheritance disputes.

“When probate is stalled, the risk of conflict rises. Delays in the probate process can potentially provide more time for rising family tensions to boil over, or for disgruntled family members to take action on their grievances.”

Family court statistics for the first three months of 2025 show that probate grants – a legal document that confirms the authority of an executor named in a will to manage the deceased's estate, access bank accounts, sell assets, and settle debts – took just two weeks on average to get.

But probate grants marked as “stopped” took significantly longer, an average of 13 weeks to issue. A probate grant can be stopped when there is missing information in the application or a dispute involved in the distribution of the deceased’s estate.

“That 13-week period is just an average and in our experience some niche grant applications are taking over 12 months. That gap in processing time again creates opportunity for tension, especially in families where trust is already fragile,” said McGuire.

Why families fight over inheritance

When the distribution of estates stalls, whether due to probate delays or family tensions, they can do so for a whole host of reasons and claims, but McGuire said disputes tend to follow a familiar pattern.

The most common claims fall into three broad categories: challenges to the validity of the will, claims under the Inheritance (Provision for Family and Dependants) Act 1975, and arguments over how the estate is being administered.

Validity challenges – which can often hinge on whether the deceased had the mental capacity to make a will, or whether they were unduly influenced by another family member – “tend to be the most emotionally charged and complex to evidence”, said McGuire.

Approximately 10,000 individuals contest wills annually in England and Wales.

This figure could rise further with new complexities around inheritance tax rules, which will see pensions included in the estate for tax purposes from 2027. On the other hand, a well drafted will can help reduce the inheritance tax bill your loved ones pay.

Inheritance Act claims, by contrast, focus on financial need, brought by individuals – often spouses, adult children or cohabiting partners – who feel they’ve been unfairly left out.

The Inheritance (Provision for Family and Dependants) Act 1975 allows certain individuals to make a claim against a deceased person's estate if they believe the will or intestacy rules do not make reasonable financial provision for them.

These individuals are typically close family members or those financially dependent on the deceased. Claims must be made within a specific time frame, usually six months from the grant of probate.

But McGuire said some of the trickiest claims can arise around the conduct of executors.

“Executors are typically expected to remain neutral when conflict breaks out. But neutrality can be hard to maintain if they’re also a beneficiary,” he said.

When that dual role creates a perceived conflict of interest, executors can be under close scrutiny and, consequently, challenged. In some cases, they may ultimately be held personally liable for the costs of the dispute.

"Situations like this are surprisingly common, especially in blended families or where the will names a close relative as executor. It’s a reminder that estate planning isn’t just about tax, it’s about people,” said McGuire.

Disputes don’t just delay the process – they complicate it. When a dispute forces a return to paper-based filing – “which happens more often than people realise”, according to McGuire – delays are virtually guaranteed.

The longer an estate remains unresolved, the higher the financial and emotional cost, he said.

“Legal fees mount, relationships fray, and the value of the estate itself may erode. For families navigating these waters, early legal advice and watertight estate planning are more essential than ever," McGuire added.

How to avoid probate disputes and delays

There’s no silver bullet when it comes to avoiding inheritance disputes, but there are clear, proactive steps that can reduce the risk.

One of the most effective tools is appointing a professional executor or trustee. Where family members double as executors and beneficiaries, the potential for conflict is high. An independent third party brings neutrality and helps maintain trust among heirs.

Structuring the estate through a discretionary trust can also help, said McGuire. This gives trustees the flexibility to respond to changing circumstances and mitigate rigid outcomes that might otherwise provoke challenges.

Lifetime gifting is another route – done properly, it can mitigate the risk of a future Inheritance Act claim if the gifting is deemed to be reasonable financial provision and avoid inheritance tax.

Allowing for a gift being made on the condition that the recipient will not bring a claim against the estate can also limit the prospects of a dispute.

"For those concerned about disgruntled relatives contesting the will, a carefully drafted no-contest clause may act as a deterrent, though it’s not foolproof,” said McGuire.

Supporting the will with a letter of wishes can also be invaluable, he added. While not legally binding, it provides context for decisions and may help defuse emotionally charged misunderstandings.

Ultimately, said McGuire, good planning doesn’t just protect the estate, it protects the people left behind.

“A clear structure, neutral administration and thoughtful communication go a long way in minimising the fallout when grief and money collide."

Pensioners with an income of £35,000 or less will benefit from the Winter Fuel Payment in late 2026 or early 2027 – but millions are set to miss out.

The Winter Fuel Payment was previously made to anyone of state pension age or older, but in 2024, the government announced it was means-testing the payment. Ministers limited it to those on Pension Credit and other specific benefits, meaning just roughly 1.5 million individuals received one in the 2024/25 winter.

In June 2025, the government changed the eligibility rules following a public backlash, opening the payment up to those with incomes of £35,000 or less.

Around nine million pensioners in England and Wales received the payment in winter 2025/26, but about two million over state pension age with taxable incomes of £35,000 or more missed out.

With the state pension rising by 4.8% in April 2026 under the triple lock, more pensioners could breach the £35,000 threshold this winter and miss out on the up to £300 payment.

If your income does go over £35,000, the Winter Fuel Payment will be paid to you and reclaimed later by HMRC, unless you choose to opt out. The ultimate deadline to opt out for the 2026/27 payment is 11.59pm on 20 September 2026.

The Winter Fuel Payment is worth £200 per household, or £300 per household where there is someone aged over 80. It is typically paid in November or December.

If you’re worried you won’t qualify for the Winter Fuel Payment because you get more than £35,000 of income a year, there are ways to boost your chances of qualifying.

Some don’t even involve reducing your actual income; instead, it’s about smart financial planning.

Helen Morrissey, head of retirement analysis at investment firm Hargreaves Lansdown, tells MoneyWeek: “The government only looks at your taxable income so there are some simple things you can do to reduce this, which means you can qualify for the Winter Fuel Allowance as well as save tax.”

1. Move your savings and investments into ISAs

The £35,000 threshold is based on an individual’s taxable income, rather than their total income.

This means one of the first things you should do is ensure you’re making the most of ISAs. Any savings interest you make from cash ISAs or capital gains from stocks and shares ISAs does not count towards your taxable income.

In contrast, interest earned on non-ISA savings accounts, or taxable income from investments, is included.

Morrissey says: “We’ve seen interest rates rise in recent years and with interest on savings held outside an ISA counting as taxable income you might find that this pushes you over the threshold. This is the case even if the interest earned does not breach your personal savings allowance which currently stands at £1,000 for basic rate taxpayers and £500 for higher rate taxpayers.”

For example, £20,000 in a savings account earning 4.5% would make £900 in interest for the year. While this falls within the personal savings allowance of £1,000 for basic-rate taxpayers and isn’t taxed, it’s still considered as “taxable income” and counts toward the £35,000 Winter Fuel Payment limit.

2. Consider Premium Bonds if you’ve maxed out your ISA allowance

If you’ve already used this year’s ISA allowance and you have significant savings where the interest could cause you to breach the £35,000 taxable income limit, consider buying Premium Bonds.

Any Premium Bonds prizes you may win are tax-free, so won’t be included in your taxable income.

Maike Currie, vice president of personal finance at pension provider PensionBee, says: “With a maximum holding of £50,000, Premium Bonds can provide a useful home for cash that might otherwise generate taxable interest.”

3. Take your pension tax-free cash – but beware of taking more

As well as ensuring you can enjoy the gains from your savings and investments without counting towards your taxable income, you should also have a look at your pensions.

Taking the 25% tax-free cash from any workplace or personal pensions can give your retirement income a decent boost, and crucially it’s not taxable income.

However, any other money from pensions, such as via an annuity, income drawdown or a lump sum is taxable.

Morrissey suggests keeping an eye on your pension income and potentially combining pension and ISA income to keep you below the threshold. For example, if you had previously been taking £30,000 from your pensions each year, and also receive £10,000 from the state pension, that works out as £40,000 taxable income.

However, if you reduced the £30,000 to £25,000 income from your pension, and topped up your income with £5,000 withdrawals from your ISA, then you would still have the same £40,000 total income (including the £10,000 from the state pension) – but only £35,000 would be taxable.

Note that the criteria states you can receive the Winter Fuel Payment if your taxable income is at or below £35,000 a year. So, if it’s exactly £35,000, you will still qualify.

Also note that if you are receiving an annuity, it isn’t possible to reduce this income, as it’s a guaranteed pension income for life.

If you are taking lump sums from your pension pot(s), or have set up an income drawdown arrangement, you can reduce the amounts to avoid tipping over the £35,000 threshold.

4. Think about deferring your state pension

As well as ensuring you can enjoy the gains from your savings and investments without counting towards your taxable income, you should also have a look at your pensions.

Taking the 25% tax-free cash from any workplace or personal pensions can give your retirement income a decent boost, and crucially it’s not taxable income.

However, any other money from pensions, such as via an annuity, income drawdown or a lump sum is taxable.

Morrissey suggests keeping an eye on your pension income and potentially combining pension and ISA income to keep you below the threshold. For example, if you had previously been taking £30,000 from your pensions each year, and also receive £10,000 from the state pension, that works out as £40,000 taxable income.

However, if you reduced the £30,000 to £25,000 income from your pension, and topped up your income with £5,000 withdrawals from your ISA, then you would still have the same £40,000 total income (including the £10,000 from the state pension) – but only £35,000 would be taxable.

Note that the criteria states you can receive the Winter Fuel Payment if your taxable income is at or below £35,000 a year. So, if it’s exactly £35,000, you will still qualify.

Also note that if you are receiving an annuity, it isn’t possible to reduce this income, as it’s a guaranteed pension income for life.

If you are taking lump sums from your pension pot(s), or have set up an income drawdown arrangement, you can reduce the amounts to avoid tipping over the £35,000 threshold.”

5. Transfer income-generating assets to a spouse with less income

Another way to reduce your taxable income is to move assets to a spouse or partner whose income is below the £35,000 threshold.

For a couple where one person has an income above £35,000 and one has an income of less than this amount, they will both get the Winter Fuel Payment (which is £100 each, or £150 if one person is over 80), but the higher earner will have to pay theirs back.

So, if one of you has taxable income of £40,000 and the other has £20,000, by shifting £5,000 of income to the lower income partner, you can still enjoy £60,000 total household income together – and both keep the Winter Fuel Payment.

Currie explains: “Where appropriate, holding savings in the name of the lower-earning partner may reduce the amount of taxable interest attributed to the higher earner, but only where this reflects a genuine transfer of beneficial ownership. The tax implications can be complex, so it’s worth taking independent financial advice before making any changes.”

6. Don’t worry about certain benefits adding to your income

Many benefits are not taxable, so you can receive them without worrying they’ll contribute to the £35,000 limit.

Sarah Pennells, consumer finance specialist at retirement firm Royal London, points out that Attendance Allowance, which is not means-tested and is paid to people over state pension age to help with extra costs if they are ill or disabled, is not taxable. Neither is Pension Credit and the Winter Fuel Payment itself.

However, some are, such as Carer’s Allowance (or the Carer’s Support Payment in Scotland). So, remember to include the taxable ones when calculating if you’re at risk of losing the Winter Fuel Payment.

7. Claim expenses on rental income

Landlords can deduct expenses from their rental income to reduce their taxable profit and total income, Currie, from PensionBee, points out.

Just make sure that the expenses you are deducting are solely for the purposes of renting out a property.

Some expenses you can deduct from your rental income include: general maintenance, letting agent fees and buildings insurance.