WELCOME TO MONEYWISE
Keep your head after a windfall
SOME OF OUR WRITERS
GEORGE PITCHER The Reverend is a former industrial editor of the Observer. He is the Archbishop of Canterbury’s secretary for public affairs
ESTHER RANTZEN Esther is a legendary consumer rights broadcaster, best known for fronting BBC’s That’s Life
JEFF PRESTRIDGE Jeff is the renowned personal finance editor at the Financial Mail on Sunday
ABY JOHANNA GORNITZKI BY
friend of mine recently inherited a large sum of money when, sadly, one of her relatives passed away. Albeit under tragic circumstances, it was the first time in her life my friend had ever come into money that she didn’t have to spend on something essential, such as household bills or a new car. She panicked. Although she could use the money in whichever way she wanted, with so much choice she didn’t have a clue what to do or where to start. All she knew was that she wanted to take good care of her late relative’s life savings.
This is a problem facing many people after a windfall. Whether you’ve won money on the lottery, been given a bonus at work or received an inheritance, it’s difficult to know if you should just chuck it all in a savings account, put your faith in the stockmarket or buy yourself a property. To help you out, we’ve examined what options would be best depending on your individual circumstances.
This month also sees the launch of the third part of our campaign on Defending the British Family, in which we look at how the UK tax system is crippling households. While the majority of families are basic-rate taxpayers, additional taxes such as national insurance, council tax and VAT see the average family handing over about 40% of their income to the taxman. But will it get worse? Find out more on page 32.
Lastly, it’s difficult to know how much money you need to earn before you consider yourself to be well-off. We asked three people on incomes ranging from £10,000 to more than £80,000 if they feel rich. Surprisingly, despite a £70,000 gap they felt they were on the same level in terms of richness, showing wealth is always relative. This is something worth remembering in difficult financial times such as these. firstname.lastname@example.org
FREEWITHYOUR MARCH COPY OF MONEYWISE
This month’s supplement
Knowing which individual savings account to go for can be tricky – not only are there cash, stocks and shares, self-select and now junior ISAs to differentiate between, but also a myriad of options within each of these categories.
As so much choice can be overwhelming, our Easy ISA Guide aims to help you find the account that best suits you.
Starting at the beginning, we tell you how ISAs work, the rules and limits, through to the charges to look out for in a stocks and shares ISA.
PAGE 3:THE BASICS PAGE 6: CASH ISAS PAGE 12: STOCKS AND SHARES PAGE 18: SELF-SELECT ISAS PAGE 21: JUNIOR ISAS
MONEYWISE MARCH 2 0 1 2 GROUP PERSONAL FINANCE EDITOR Rachel Lacey EDITOR Johanna Gornitzki DEPUTY EDITOR Ruth Jackson SENIOR STAFF WRITER Nathalie Bonney STAFF WRITER Rebecca Rutt SUPPLEMENT WRITER Faith Glasgow
CONTRIBUTORS Sam Barrett, Ruth Emery, Faith Glasgow, Rob Griffin, Sally Hamilton, George Pitcher, Andrew Pitts, Jeff Prestridge, Esther Rantzen, Cherry Reynard, Christine Toner
ART DIRECTOR Mark Stammers PRODUCTION EDITOR Laura Staples CHIEF EXECUTIVE Tomas Carruthers PUBLISHING DIRECTOR Jeremy King ASSOCIATE PUBLISHER Kay Fox Joyce MARKETING MANAGER Alexandra Kyriakidis ADVERTISING MANAGER Chris Sorrell
Moneywise Magazine First Floor, Standon House, 21 Mansell Street, London, E1 8AA 020 7680 3600 (phone) 020 7702 0710 (fax) moneywise.co.uk email@example.com
SUBSCRIPTIONS HOTLINE 01795 414 934 Annual subscription UK £47 Write to: Moneywise Customer Services PO Box 326, Sittingbourne, ME9 8FA or subscribe online at moneywise.co.uk
Member of the Audit Bureau of Circulation. Average monthly circulation January – December 2010: 19,020 Newsagent distribution by Seymour Distribution Ltd 2 East Poultry Avenue London EC1A 9PT 020 7429 4000 seymour.co.uk Moneywise Publishing Ltd © 2012 An Interactive Investor plc company Registration number: 5034730
PAGE 9:HOWTO KEEPYOUR COSTS DOWN PAGE 12:WHERETO INVEST IN 2012
MARCH 2012 | MONEYWISE 7