There are unprecedented numbers of people taking the self-employed route in the UK. According to data from the Office for National Statistics (ONS), there were over five million self-employed professionals across the UK in Q4 2019. It now represents over 15% of the UK’s entire labour market – up from 12% at the turn of the millennium.

It doesn’t matter whether you are starting your own business as a self-employed freelancer or an outright start-up, it’s just as important that fledgling entrepreneurs look to the future as well as the present. The National Employment Savings Trust (Nest), the government-funded pensions provider, revealed that less than a quarter (24%) of self-employed entrepreneurs are actively putting funds aside for the future in a pension pot.

There’s no doubt that the peaks and troughs of self-employed income can make it unappealing to stash money away into a pension pot when work dries up, but it’s vital to think about your life after work. Being responsible with your hard-earned money today can reduce your sole dependency on the state pension later in life. If you are starting out and financing a new business in your 30s or 40s, it’s still not too late to think about your long-term savings. The four solutions below can help cement your future in retirement from your business.

Consider your pension fund options

Self-employed pension schemes are left entirely up to the individual to plan for their own future. That’s at odds with PAYE employees, whose companies are legally obliged to enrol staff in an auto-enrolment pension scheme from day one. If you are a small business owner, you have three options when it comes to setting up a new pension fund. First and foremost, you have a basic personal pension, which most investment firms will provide. Secondly, you can open a self-invested personal pension (SIPP) which gives you the flexibility to invest your funds in anything from stocks and hedge fund through to commercial and residential property developments. Finally, you also have the option of entering the Nest scheme, which permits monthly contributions from as low as £10.

Save funds into ISAs

An alternative to saving into a pension fund is to open an Individual Savings Account (ISA). ISAs are considered one of the most tax-friendly savings options for entrepreneurs, given that you can invest up to £20,000 per annum tax free. There is no minimum threshold for investment in ISAs either, which means you can invest anything between a tenner and £20,000. The ISAs we’ve described above are known as stocks and shares ISAs. There are also cash ISAs which will simply grow in line with interest rates and inflation.

Don’t put all your eggs in one basket

The smartest entrepreneurs will diversify their savings across a variety of assets. This helps to protect their wealth in case of business failure. It also means that savers would have to be extremely unlucky to experience all their assets losing their value. Some entrepreneurs also take matters into their own hands and invest some of their income into the forex markets, which see fiat currencies rise and fall based on political and economic climates. Forex investors can also get a help with their initial investment via forex bonuses that maximise trading balances for all newbies. There’s also the burgeoning cryptocurrency sector that’s proving particularly popular as an alternative currency investment instead of forex and commodities like gold and silver.

Think about an exit strategy for your business

If you are setting up in business with the sole intention of selling it to pay for your retirement, you will need to ascertain what’s known as a ‘lifestyle figure’. This is the amount you will need to achieve from the sale to enjoy the lifestyle you desire. Remember that any business sale will be subject to Entrepreneurs’ Relief. This means that you will have to pay a reduced rate of 10% tax on sales up to £1 million in your lifetime. Anything over this amount and you will be subject to pay higher tax rates. Your exit strategy may not revolve around selling the business either. Instead, you might consider an IPO and listing the company on the stock exchange, handing you immediate liquidity.

Hernaldo Turrillo

Hernaldo Turrillo is a writer and author specialised in innovation, AI, DLT, SMEs, trading, investing and new trends in technology and business. He has been working for ztudium group since 2017. He is the editor of openbusinesscouncil.org, tradersdna.com, hedgethink.com, and writes regularly for intelligenthq.com, socialmediacouncil.eu. Hernaldo was born in Spain and finally settled in London, United Kingdom, after a few years of personal growth. Hernaldo finished his Journalism bachelor degree in the University of Seville, Spain, and began working as reporter in the newspaper, Europa Sur, writing about Politics and Society. He also worked as community manager and marketing advisor in Los Barrios, Spain. Innovation, technology, politics and economy are his main interests, with special focus on new trends and ethical projects. He enjoys finding himself getting lost in words, explaining what he understands from the world and helping others. Besides a journalist, he is also a thinker and proactive in digital transformation strategies. Knowledge and ideas have no limits.

The post How To Plan For Your Retirement As A Small Business Entrepreneur appeared first on OpenBusinessCouncil Directory.

Millennials are saving more of their income than the next oldest generation of workers. This is the surprising finding of a new global survey carried out by deVere Group, the independent financial advisory organisations.

As the report found out, those in Generation Y (24-38 years old) who normally started seeking financial advice in 2018 on average saved 19 per cent of their income for their retirement.

Those in Generation X (39-53-year olds) put aside 16 per cent on average of their income for retirement; and the Baby Boomers (54-74 years old) 35 per cent.

More than 660 people participated in the survey in the UK, Europe, Africa, Asia and the U.S. amongst new clients taken on by deVere throughout last year.

Of the survey, Nigel Green, founder and CEO of deVere Group, comments: “The results of the saving survey are both encouraging and alarming.

“It is encouraging that millennials – often falsely stereotyped for their sense of entitlement and for being content to pay for overpriced coffees and smashed avocado on toast – seem to be better at saving and more fiscally responsible than many would have thought.

“Despite their reputation for purely living for today, the poll shows that they are saving for their retirement pretty impressively.  Putting aside nearly a fifth of their income already is highly commendable, especially when many can be expected not to be yet at the peak of their earning power.”

He continues: “What is alarming, however, is that Gen X, and to an extent Gen Z, workers are not saving nearly enough in order to be able to have a comparable lifestyle in retirement.  And by the virtue of being older, they have less time to build wealth before leaving work.

As deVere CEO sees it, this is perhaps particularly concerning because we’re living longer, meaning the money we accumulate has to last longer; in the future, it’s unlikely that governments will be in a position to support older people like they have done for previous generations; there is a looming health and social care crisis; as well growing deficits in company pension schemes.

“In addition, it has to be considered that there might not be the option available to work longer if necessary due to ill health, lack of career opportunities, or because of the need to look after sick or elderly relatives,” Mr Green goes on to say, “We need to revitalise the savings culture of Gen X especially. Otherwise many of today’s working population are going to reach retirement and find they have to downgrade their lifestyle and/or continue working longer than they had expected and hoped, due to a lack of savings.”

The deVere CEO concludes: “It’s never too late to start saving for your future, but of course the earlier you begin, the easier it will be to reach your long-term objectives.  As such, the millennials surveyed deserve huge credit. There’s a plethora of financial planning solutions that help you achieve financial freedom in retirement at whatever age you are.”

Hernaldo Turrillo

Hernaldo Turrillo is a writer and author specialised in innovation, AI, DLT, SMEs, trading, investing and new trends in technology and business. He has been working for ztudium group since 2017. He is the editor of openbusinesscouncil.org, tradersdna.com, hedgethink.com, and writes regularly for intelligenthq.com, socialmediacouncil.eu. Hernaldo was born in Spain and finally settled in London, United Kingdom, after a few years of personal growth. Hernaldo finished his Journalism bachelor degree in the University of Seville, Spain, and began working as reporter in the newspaper, Europa Sur, writing about Politics and Society. He also worked as community manager and marketing advisor in Los Barrios, Spain. Innovation, technology, politics and economy are his main interests, with special focus on new trends and ethical projects. He enjoys finding himself getting lost in words, explaining what he understands from the world and helping others. Besides a journalist, he is also a thinker and proactive in digital transformation strategies. Knowledge and ideas have no limits.

The post Which Generation Saves Most For Their Retirement? appeared first on OpenBusinessCouncil Directory.

Baby boomers didn’t view their work in the same way. If their jobs didn’t provide satisfaction, then they would console themselves with the fact that they provided an income. But because they have such different expectations of the world, baby boomers – who make many of the hiring decisions in today’s economy – can get Millennials totally wrong. Here’s what millennials want from a job.

They Want Social Impact

The majority of Millennials are progressive. They’ve been raised in an education system that promotes social values above all else, and it’s rubbed off on them. Even the most business-minded Millennials want to know that the companies they work for are doing the rest of society good. According to Capital Group, more than 82 per cent of Millennials say that they think that it is crucial for companies to look after the wellness of their customers and employees. They also believe that companies should invest in “ethical” stocks; not big tobacco or the oil and gas industry.

They Want Family Life To Take Precedence

For Millennials, work and family life are not equal things that they try to balance with each other: family life is more important. That’s why so many recruitment websites now advertise “flexible working” arrangement, whereby Millennials can adjust their timetables around their spouse’s and children’s lives. Millennials view raising a family as a success just as much as making a lot of money.

They Want To Invest In Their Retirement

Millennials don’t want to work. According to data from Forbes, only one in ten millennials would stay in their current working circumstances if they had enough money to give up work permanently.

Why do millennials care so much about retirement? Part of the answer originates from the 2008 financial crisis and recession. Millennials, many of whom were in entry-level jobs at the time, suffered badly, and are only now working their way back up the income ladder. The catastrophe forced many to think carefully about their futures and consider ways of smoothing their income further down the line, including retirement.

They Want Employers To Share Their Values

Previous generations saw a job as a means to an end. But idealism and progressive ideology have made millennials morally fussy. They want their employers to share the same values as them.

As discussed, millennials’ circumstances have changed a great deal over the last ten years. No longer are they broke college grads living at their parents’ houses but rather heads of young families with different needs. They want their employers to focus more on facilitating family life and helping them clear their debts.

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Hernaldo Turrillo

Hernaldo Turrillo is a writer and author specialised in innovation, AI, DLT, SMEs, trading, investing and new trends in technology and business. He has been working for ztudium group since 2017. He is the editor of openbusinesscouncil.org, tradersdna.com, hedgethink.com, and writes regularly for intelligenthq.com, socialmediacouncil.eu. Hernaldo was born in Spain and finally settled in London, United Kingdom, after a few years of personal growth. Hernaldo finished his Journalism bachelor degree in the University of Seville, Spain, and began working as reporter in the newspaper, Europa Sur, writing about Politics and Society. He also worked as community manager and marketing advisor in Los Barrios, Spain. Innovation, technology, politics and economy are his main interests, with special focus on new trends and ethical projects. He enjoys finding himself getting lost in words, explaining what he understands from the world and helping others. Besides a journalist, he is also a thinker and proactive in digital transformation strategies. Knowledge and ideas have no limits.

The post Millennials Reveal All About What They Want From An Employer appeared first on OpenBusinessCouncil Directory.

How far ahead have you actually planned for your retirement?  If you are searching high and low for that answer, it may be time to start thinking about ways to start that planning.  With retirement looming over all of our heads, the clock is counting down the days where we all need to start thinking a few steps ahead than we currently are for our future monetary situation.  While the numbers may be skewed a bit and vary between sources, it is estimated that millions of US households don’t have any type of retirement plan in place.  Are you in that category?

If you are new to the retirement world, let’s start by breaking it down.  What is does IRA stand for?  An IRA is also known as an Individual Retirement Account, or in other words, broken down very simply, a way to save up money for when you decide to finally retire.  Keep in mind that there are quite a few different IRA’s to consider.  401K’s, savings accounts,  and investment options are just a few that top the list.   You can invest in an IRA as an individual or see if your employer offers up and type of resources to help you in your savings planning.   It’s also extremely important to note that there are many options to choose from, but it is up to you to fully decide and understand which IRA option is going to work best for you and your future financial goals.

There are some advantages and disadvantages to having an IRA.  Depending on what IRA resources you decide to start investing in, one of the biggest advantages could be that the money that you put into your IRA account is tax-deferred.  To break it down – what that actually means is that you don’t have to pay any taxes on the money that you are saving until you actually withdraw that money at a later date.  It basically is a postponement of the taxes owed.  Again, this isn’t an option for all types of IRA’s!  Do your research to see if this is an option for one that you may be considering.  Another great benefit that can happen as well is that your money grows tax-free while it is sitting in your IRA account.  Who doesn’t like free money?!

While there are several advantages to take note of, there are accompanying disadvantages that can occur as well.    A disadvantage of having certain IRAs is that there are penalties that are imposed if you have to withdraw the money earlier then before you turn age 59 1/2.  The amount of that penalty?  A whopping 10% fee.

Many people wonder how much money they should start saving for their retirement years.  There is no magic answer or crystal ball for that question.  The amount varies depending on what that person will need to live and thrive during their years of retirement.  Depending on who you ask and what research you may find, the recommended amount of savings to have by the time you retire varies drastically.  Some experts say a minimum of 10%, while others say it should be more.  Only you know the true answer to this and how you want to spend your retirement years.

Start looking ahead and planning now for your future and your retirement years.  Educate yourself on the different IRA options available and choose one that best suits you and your financial needs.

Hernaldo Turrillo

Hernaldo Turrillo is a writer and author specialised in innovation, AI, DLT, SMEs, trading, investing and new trends in technology and business. He has been working for ztudium group since 2017. He is the editor of openbusinesscouncil.org, tradersdna.com, hedgethink.com, and writes regularly for intelligenthq.com, socialmediacouncil.eu. Hernaldo was born in Spain and finally settled in London, United Kingdom, after a few years of personal growth. Hernaldo finished his Journalism bachelor degree in the University of Seville, Spain, and began working as reporter in the newspaper, Europa Sur, writing about Politics and Society. He also worked as community manager and marketing advisor in Los Barrios, Spain. Innovation, technology, politics and economy are his main interests, with special focus on new trends and ethical projects. He enjoys finding himself getting lost in words, explaining what he understands from the world and helping others. Besides a journalist, he is also a thinker and proactive in digital transformation strategies. Knowledge and ideas have no limits.

The post Have you Considered an IRA For Your Retirement Planning_ appeared first on OpenBusinessCouncil Directory.