Weekly News Bulletin - 08/11/2021

ISA's

ISAs set to create more annual millionaires than the lottery by 2031

ISAs will create more millionaires each year than the lottery by 2031, according to research by InvestingReviews. The financial comparison website commissioned research by the Royal Statistical Society, chartering the likely rise of stocks and shares ISA millionaires based on HMRC data. Currently, the lottery creates just over 300 millionaires each year across all games but in 10 years’ time the annual number of new ISA millionaires is forecasted to average 322. The research suggests it will take eight years from now for the current number of ISA millionaires across major platforms to double, hitting almost 3,000 by 2029. And by 2046 the total number of ISA millionaires created in the UK will eclipse the total number of lottery millionaires created. By then, the number of ISA millionaires created will have increased more than tenfold to 14,789, rising by more than 1,000 each year on average and overtaking the 13,900 lottery millionaires generated by then. P2P Finance News

Savings

Low interest rates prompt savers to invest

Research by Aegon reveals over half (54%) of adults have moved money into investments because of the low interest rates offered by cash savings accounts. 10% said they have put all their extra savings into investments, and this increased to 15% for those aged between 18 and 34. Some 44% of adults surveyed put "some" of their cash into investments. While a majority have been prompted to invest, 45% said they have kept their money in cash savings despite low interest rates. Interest on savings falling below 2% was the tipping point for most people putting money in investments. 35% said interest rates falling to between 1-2% was the tipping point and a further 39% said it was when interest rates fell below 1%. Money Marketing Your Money

Pensions

'Callous and cruel!' Lords defeat Rishi Sunak's pension triple lock

FURIOUS peers inflicted a heavy defeat on the Government over its plan to suspend the pension triple lockformula to increase the state pension. Ministers were told they must rethink their move to block a bumper payout to pensioners this year to save the Treasury £5billion. Payments were set to rise by up to £14 a week because the pandemic skewed the figures used to calculate the rise. But the government said it was suspending the lock for a year to “ensure fairness for both pensioners and taxpayers”. Baroness Altmann spearheaded a campaign in the Lords to change the legislation that would enact the policy. The former pensions minister’s amendment to allow the lock to be maintained, but with adjustments to take account of the impact of Covid crisis, was backed by 220 votes to 178. She said: “Already more than half of single pensioners are living in fuel poverty, mostly women, while 13 percent of older households live in extreme fuel poverty. “Those numbers will undoubtedly grow if this Bill is passed without amendment, especially as rising energy costs are hitting so many with massive increases in their bills.” BBC News The Express

HMRC overcharges those accessing pensions £44m

Pension Flexibility statistics released by HMRC show that between July and September the tax office refunded £44,659,174 to people who were over-taxed when accessing their pension. Helen Morrissey, senior pensions and retirement analyst at Hargreaves Lansdown, described the figure as “eye-watering” and “whopping”, adding: “This isn’t some kind of horrible mistake by the taxman, it’s how the system is intended to work.” She went on to say “Given the ongoing popularity of the freedom and choice reforms it’s an administrative nightmare that should have been sorted long ago. Instead people must navigate a complex system filling out various forms to get their hands on their money,” “The Government recently confirmed its intention to invest in improving how pension tax reliefs are administered we must hope they will also look to bring this system out of the dark ages.” City A.M.

Will you find any missing pension treasure this weekend?

It was National Pension Tracing Day on 31 October, a new initiative launched by Punter Southall Aspire, which is backed by leading pension providers The clever guys behind this campaign encouraged people to use the extra hour when the clocks went back to go on a treasure hunt and start tracing mislaid or lost pensions. There’s a staggering £19.4 billion in lost pensions out there. This is around 1.6 million pension pots, with the average lost pension pot being worth around £13,000. An estimated 1 in 30 may have lost their pensions. You may ask why someone would lose or forget a pension. Well, a big factor is people changing jobs – on average 11 times during their careers – and moving house, typically eight times, but forgetting to tell their pension company their new contact details. However, the fantastic news is it’s not too late to find these lost pension pots… and what’s more it’s free and easy to do! Punter Southall Aspire has launched an online resource centre that shows you exactly how to go about this. Nationalpensiontracingday.co.uk Business in the News Pensions Age

Doctors hit by extra £11m pension tax

Analysis suggests that between them, hundreds of retired doctors have paid more than £11m extra in tax unnecessarily as they went over their pension savings allowance. Research carried out by the wealth manager Quilter found that 413 retired doctors in England and Wales unknowingly overpaid an average of £26,634 in extra tax because they did not fill out an HMRC form applying for what is known as individual protection to protect their pensions from the tax charges. Kate Palmer in the Sunday Times says that while doctors can often face such overpayments, this is “an issue for all wealthier savers who may be eligible for a protection scheme that reduces the tax they pay if they save beyond the lifetime allowance.” The Sunday Times

Property

Half of Brits have never remortgaged because it’s too much ‘hassle’ – but it could save you THOUSANDS

Half of British homeowners have never remortgaged - even though one in three know it could probably save them money. A survey, of 2,000 people with a mortgage, found they still have an average of 45% of it left to pay. But 9% admit they have no idea exactly how much they still owe. and 49% believe the hassle and paperwork of remortgaging wouldn't be worth the financial savings. A spokesman for Barclays Mortgages, which commissioned the research, said: “It's clear from our research that many find remortgaging a tricky subject to understand, even though UK adults have been on the mortgage payment ladder for an average of 13 years and five months." The Sun

UK house prices hit new highs with typical home topping £250k

House prices have hit record highs, with the average property price passing the quarter of a million pounds mark for the first time. Nationwide’s House Price Index shows that the typical house price is now £250,011. This comes after values rose by 0.7% in October, up from 0.2% in September. Year-on-year, prices were up 9.9%, with this down slightly on the 10% recorded in September. The analysis shows there were 72,645 mortgage applications in September. Nationwide notes that possible base rate hikes from the Bank of England are pushing up mortgage rates, saying this may dent the property market. Robert Gardner, Nationwide's chief economist, said demand for homes has remained strong, despite the stamp duty holiday coming to an end on September 30. City A.M.