3 financial practices to avoid government benefits

Beginning these financial practices as soon as possible will set you up for a more secure future.

By Nicole Hamer |

13:27 03 May 2013

There are a host of benefits available to older citizens of the UK such as winter fuel allowances, colour TV license, and free NHS prescriptions.

 

There has been increasing concern regarding the ability of the social funding programmes to cover needs after the year 2020.

 

There is a new Universal Credit programme being implemented in stages, but there is also a call to those who have plentiful assets to refuse the government assistance so the funds will be available for those who truly need them.

 

Even those who are currently working and are many years from retirement could re-evaluate their financial practices to ensure they will be provided for in the future.

 

What financial practices can secure your future?

 

• Pensions—many employers will contribute amounts to this programme, so take advantage of that. It is essentially free money and use of the programme is considered one of the wisest financial practices, some companies may also agree to match your own contributions up to a certain amount.

 

• Investments—this could be bonds, foreign exchange, or anything in your financial practices which has the potential to greatly increase the return on your initial investment. One type of Individual Savings Account (ISA) also falls under this sector.

 

• Savings Accounts—consider this a supplemental income that you’ll receive in addition to your pension. Choosing savings accounts wisely can mean extra security when you’re ready to retire. There are quite a few to choose from:

 

1. Stocks and Shares ISA—has the most potential to yield better return depending on the type of investments selected. There is also the possibility to lose initial funds if investments do poorly.
2. Cash ISA—lower rate of return, but guaranteed to retain at least the amount you deposited.
3. Regular savings accounts—these have the lowest rate of return, but there is no annual cap as there is on the ISAs.

 

If you employ all of these financial practices, you may avoid needing to dip into the government benefits, and will be able to help ensure the funds remain for those who may desperately need them.