Investing for you and your family: finding balance

Here, we look at how you can be tax efficient when finding this balance, the different decisions you may be grappling with, and lay out the routes you can take to investing for you and your family’s future.

In this guide, we cover:

1. Managing your lifestyle: understanding your finances, and some key questions to consider when looking to plan for you and your family’s future.
2. Understanding your priorities: laying out some key decision points that may be available to you if you have surplus income or you are due to receive a lump sum. We focus on the merits and drawbacks of two common options: overpaying a mortgage and increasing pension contributions.
3. Planning for your future: making the most of your Individual Savings Account (ISA) allowance, the key tax wrapping benefits of the product, and the flexibility they offer.
4. Investing for your children: an overview of Junior ISAs (JISAs) and bare trusts, projections of how consistent monthly JISA contributions could see your child with an account balance of over £262,000 by the time they turn 18, assuming a 5% annualised rate of return.

Finding the right balance

If you are due to receive a lump sum, or you have surplus income that you want to put to work for you and your family’s future, there are many options. Finding the right balance between the tax relief benefits of additional pension contributions, the interest-saving merit of overpaying a mortgage and the flexibility and tax-wrapping qualities of ISAs and JISAs, is a good problem to have. There is no precise blueprint to the order in which these options should be used.

Having a diversified approach that provides flexibility, while taking advantage of the different benefits that all of the options provide, could be a sensible approach. However, everyone’s individual circumstances vary. A lot will come down to your priorities and long-term financial objectives.

If this is something you would like to speak to our wealth experts about, you can book a call for free financial guidance at a time of your convenience. If a more tailored approach may suit, we also offer a paid ‘restricted’ advice service. Restricted means we will only make investment recommendations on the products and services that we offer.

Risk warning

As with all investing, your capital is at risk. The value of your portfolio can go down or up and you may get back less than you invest. Pension/ISA/JISA eligibility rules apply. Tax rules vary by individual status and may change. This is general information, not personalised tax advice. Seek financial advice if you're unsure if a pension is right for you.