Encouraging women to invest

What financial empowerment actually means

Your life and finances are linked so financial empowerment is about so much more than just finance. It’s about taking control so that you have choices and opportunities in life. As part of my role, I help people visualise where they can get to in life. We look at what makes you happy now and what will make you happy in the future and then we make a plan to help you get there.

Ann-Marie Atkins, Managing Partner for Financial Planning in the North West

Investing instead of just saving cash

Having some of your money in cash is important as there is always a scenario where you could need to access money quickly. Interest rates we know are low and we also know that the price of many of the things we spend our money on day to day have gone up (inflation). Investing gives you the potential to grow the value of your money over the medium to long term and so to make cash work harder people choose to invest any surplus they have for their future. You should only invest money that you can leave invested for at least five years.

Rebecca Doble, Financial Planning Director, London

Auto-enrolment has made investors of most of us

If you are auto-enrolled into a workplace pension, which most of us are, then you’re already an investor. And if money is being taken out of your salary and invested, it’s important to know how it is invested.

Ann-Marie Atkins, Managing Partner for Financial Planning in the North West

How much money do you need to get started?

There is often the perception you need a lot of money to become an investor but you don’t. It doesn’t cost you anything to open an account and you can start investing from as little as £50 a month. We see a lot of people setting up monthly plans and it’s a great way to get into the habit of investing.

Briony Laker, Client Relations Executive, Liverpool

Choosing the right investment account

There are different sorts of accounts so make sure you pick the one that is right for you. An ISA (which stands for Individual Savings Account) is a great place to start. ISAs are quick and easy to set up and are different to other accounts because they are free from Income Tax and Capital Gains Tax. Each tax year you can invest up to £20,000 in an ISA.

Pensions are also popular and come with great tax benefits. The Government will top up anything you invest by 20% and if you’re a higher or additional-rate taxpayer, you can claim back more tax through your tax return. Every year you can contribute as much as you earn, usually up to a maximum of £40,000 into a pension but you can’t take it out until you’re 55!

Nerys Stevens, New Business Team Leader, Liverpool

Saving tax

You pay a lot of tax, so when you’re saving up for the future why wouldn’t you try to save tax? There are simple things you can do to like saving into an ISA or pension but to make sure your money is working really hard, it’s a good idea to seek support from a professional adviser.

Ann-Marie Atkins, Managing Partner for Financial Planning in the North West

Choosing investments

People often assume that investing means shares in individual companies or they have heard about Bitcoin, a much edgier way to invest, due to the publicity hype. But there is so much more to the world of investments than that.

At Tilney, we work with clients to create investment portfolios that contain a mix of different funds, which – depending on their level of risk – are divided between different assets and geographical locations. A fund is a collection of different shares pooled together. We prefer to invest in funds rather than shares, as it provides a safer and diverse option for our clients.

Chloe Stages, Investment Advisory Service, London

Don’t put all your eggs in one basket

We suggest people hold a diversified portfolio of investments. What we mean is that you shouldn’t put all your eggs in one basket but instead should have a mix of different types of investments. This is because different types of investments can respond differently to market conditions so having a spread could help to expose you to less overall investment risk.

Mubbien Hayat, Investment Adviser, London

How do you feel about taking risks with your money?

Investing is considered more risky than keeping your money in cash because the value of investments can go down as well as up, which means you could end up losing your money. Some investments are riskier than others and it is generally considered that the more risk you take when investing, the more scope there is for reward. But taking on a high level of risk doesn’t guarantee greater rewards – or it wouldn’t be risky!

Rebecca Doble, Financial Planning Director, London

Your ability to tolerate risk really comes down to your time horizon. The longer you can remain invested without needing the money, the higher the level of risk you can take, and the greater potential growth of the assets. But in the short term, higher risk assets will display a greater level of volatility so if you cannot remain invested you run the risk of needing to withdraw funds when assets have fallen.

Lucinda Johnson, Investment Manager, Birmingham

Understand what you are investing in

“I’d suggest starting with small amounts and lower risk investments if you’re new to investing. You need to fully understand the level of risk you are taking and the investments you hold. Always aim to review your investments regularly.”

Danielle Bamber, Investment Manager, Manchester

Coping with financial jargon

The amount of financial jargon is shocking. My job is to turn it into language that everyone can understand, as well as explain what certain words actually mean because people will definitely come across them. My favourite piece of jargon is ‘benefit crystallisation events’. It sounds so complex but, put simply, there are 13 different times in life when your pension must be checked against the lifetime allowance to make sure you haven’t saved more in your pension than you’re allowed to. For example, one of them is turning 75. That’s all it is!

Lucy Cowley, Copywriter, London

The impact of children

Your finances should be reviewed as you return to work having taken maternity leave. You may have had a period of receiving only statutory maternity pay and your salary may be reduced if you return to work part time, but your own personal finances need to take as much priority as the family finances and budget. Do not cover all the costs associated with the children yourself. These are household/family costs and should be budgeted for with other joint costs. Women often cover these costs themselves and in turn find that they do not have enough spare cash to make their own savings. Regular savings into pensions and ISAs are important as well as building up a cash emergency fund in your own name.

Sally Beresford, Financial Planning Director, Manchester

Closing the pension savings gap

With life expectancies rising you may spend as much time in retirement as you will working. This is a challenge for everyone and means many people underestimate how much money they will need to fund retirement. Did you know that 1 in 5 of today’s 55-year-old women will live to 100*?

Many women take time out to have children, which can often lead to career breaks, part time working or a change in career to suit family life. During this time income is often reduced so not as much is directed towards retirement savings. Also, demands of family expenditure can be the focus of surplus income over saving for the future. Another family dynamic is caring for elderly relatives and again this can impact working patterns.

For many reasons women typically have not built up the same size pension pots that men have. This will have a great impact on what your savings can do for you in retirement.

Emma Sterland, Financial Planning Partner, London

When life doesn’t go according to plan

Suddenly having a pension pot and investments to manage after a divorce can be daunting. It is important to find a financial adviser who specialises in this area to help you make the decisions that are right for you.

Alex Price, Financial Planner, Belfast

How Tilney can help

We’re here to help you make the most of your money. Call us on 020 7189 2400 or email contact@tilney.co.uk to find out how we can help.

*ONS