At Campbell Harrison we are always keen to keep an eye open for all things financial. It was intriguing therefore to see this week the discussion topics from the Tax Incentivised Savings Association (TISA) pre budget report.
The report was conducted amid calls for the government to draw up a national savings strategy and review income replacement policies.
Desired Outcomes
Upon submitting the report, TISA reiterated their on-going support for the notion of a workplace ISA which would help contribute to a more flexible savings approach to help finance retirement.
The original idea of a workplace ISA was proposed by TISA back in 2008 as a method of complementing the existing pension system. Senior officials believe that the newly proposed system of retirement savings will provide a less restrictive saving option, encourage more people to pursue retirement schemes and raise awareness of taking more responsibility for your retirement years.
The desired Working ISA has been greeted with a mixed response, dividing opinions across a number of levels. Favourably for TISA, reports have suggested that the proposal has been growing in support amongst some labour and conservative officials.
What the Saving Scheme would involve
Guidelines for the new retirement plan would involve the ISA commencing at age 18 and would cease with a defined age of 65 for example, or upon reaching the state retirement stage at the time.
When the policy holder has reached the previously defined age, the funds would convert into a standard ISA under the proposed guidelines, which would then allow the individual to select an ‘income in retirement’ option that would most suit them and their future lifestyle.
On top of the working ISA, the pre budget report conducted by TISA is also advocating that the government establish a retirement savings review to consider the effectiveness of current saving and investment schemes as well as pension policy.
Interesting times ahead for the savings and investment market it would seem as the debate for a working ISA and savings strategy continues.