Do you remember when football was like this?
- Credit: Getty Images/iStockphoto
Financial columnist Peter Sharkey takes a trip down memory lane and discovers how things have changed – both at the banks and on the football pitch.
If you're a football fan of a certain vintage, may I recommend some excellent reading material likely to keep you occupied during the forthcoming Christmas holidays?
Those of us who began attending our first matches in the 1960s and 70s will undoubtedly recall a much different game to the one which nowadays is never off our television (and other) screens. Fortunately, Derek Hammond and Gary Silke have compiled and written Got Not Got Football Gift Book, sub-titled 'Every fan's catalogue of desires' for those of us who remember how things used to be back in the day.
It is an absolute joy if you vividly recall the wonder of Subbuteo, the Football League Review (stapled to the inside of your programme) or those orange Vernons Pools Mobile Information Units occasionally spotted outside the ground. On top of this, there's magazine covers from Goal and Shoot as well as players from every club, usually posing in some form of early advertisement or promotion, for which they probably received no more than a fiver and a pat on the back.
Halcyon days. A time when Ty-Phoo would send 10" x 8" photographs of your favourite team in return for 'any 12' footballs on the side of a packet of tea, and when the state pension system looked as guaranteed as your Subbuteo floodlights failing to work.
To a degree, football's radical upheaval over the past 40-50 years has mirrored that of the state pension system, although while the football industry has grown exponentially richer, especially in the past decade, the likelihood of the state being able to pay a pension to anyone under the age of 45 is, at best, remote.
Which brings me onto ISAs and pensions, specifically the Self Invested Personal Pension (SIPP) variety.
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Though ISAs and SIPPs are both tax-efficient saving and investment 'platforms' there are subtle differences between them.
In short, a stocks and shares ISA is a tax-free savings account. It differs from a cash ISA because it enables you to select where you would like your money invested - or choose a manager to invest for you. At present, anyone aged over 18 may invest up to £20,000 a year into an ISA.
The great attractions of ISAs are tax-related.
As the funds invested in an ISA have already been taxed, there is no income tax payable when money is withdrawn, irrespective of how much profit has been made during the years the funds have been invested. In addition, no capital gains tax is due on any profits either.
In contrast to a SIPP, however, there is no tax relief due on the contributions made to an ISA.
SIPPs allow investors to manage their money themselves, whether it be by investing in shares, funds, trusts, or a host of other areas, although rules forbid any investment in residential property. You may invest up to £40,000 a year into a SIPP.
One of the main attractions of a SIPP is the 20% tax relief received on contributions (or 40% for higher rate tax payers), up to the annual limit. This means that a basic-rate taxpayer investing, say, £5,000 into a SIPP, receive an additional £1,250 as a tax rebate, credited directly to your SIPP account. Furthermore, investors may also withdraw up to 25% of their SIPP as a tax-free lump sum once they reach the age of 55 (57 from 2028).
Having taken their tax-free portion of a SIPP, however, investors are subsequently taxed at their marginal rate on any additional income they withdraw.
ISAs clearly score when it comes to withdrawing cash: every penny is tax-free. The flipside is the complete absence of tax relief on contributions.
SIPPs, by contrast, tend to be more expensive than ISAs, although the tax relief received is likely to more than make up for higher charges.
So which of the two is best?
That's a bit like asking which of Goal or Shoot was the better publication. Frankly, there's no correct answer. Indeed, while investors are urged to undertake their own research into both options, provided they're 18 or over, there's nothing to stop them having one of each.
TAM Asset Management Ltd offer savers the opportunity to invest in Investment ISA portfolios comprising a variety of different funds pursuing cautious, balanced or adventurous strategies. For further details, please visit the MoneyMapp website.
For more financial advice, check out Peter Sharkey's regular column, The Week In Numbers.