A 5-minute read to help build your wealth

Important information - please keep in mind that the value of investments can go down as well as up, so you may get back less than you invest. It’s important to understand that pension transfers are a complex area and may not be suitable for everyone.

If you haven’t already been taking your financial health and wellbeing seriously, now’s the time. And while it’s never too late to make a difference, you’ll soon understand why the earlier you can start, the better. Here are some practical pointers to set you on a positive path to building your wealth.

STEP ONE - HOW TO BUILD YOUR WEALTH

1. Stay invested - even if it’s small amounts

Time is the single biggest factor that determines how your investments could grow, although there are no guarantees. The longer you’re invested the more opportunity you have to benefit from long-term stock market growth potential. History also shows that the longer you’re invested, the more likely it is that you’ll end up with positive returns and the lower the chances are that you’ll make a loss (although this isn’t guaranteed). And that’s because markets rise and fall all the time.

Don’t think you have to wait until you’ve got a big lump sum to invest either. Investing a little and often can make a big difference in the long run to your future savings. Plus, by investing regularly, you're less likely to try and time the market (something that even the experts find hard to do).

You can read more about investing regularly here. 

2. Be tax-efficient 

No one wants to pay more tax than they need to. So, it’s worth thinking about saving as tax-efficiently as you can by making the most of your tax allowances through a Stocks and Shares ISA and Self-Invested Personal Pension (SIPP). These accounts are tax-efficient in slightly different ways, and while you cannot normally access your pension product until age 55 (57 from 2028), both allow any returns to grow tax free.

As an added tax perk, the government tops up any contribution you make into your SIPP workplace pension. For basic rate taxpayers, this means that for every £80 you pay into your pension, the government will contribute £20. And if you pay income tax above the basic rate, you can claim even more tax relief through your tax return or by writing to HMRC. You can find out more about the Annual Allowance here.

STEP TWO - How to manage your investments

Now that you’re on the right track to building your wealth, here are some thoughts about managing it. 

1. Regularly review your investments 

It’s a good idea to check on your finances so you can adapt and arrange your savings as you start to navigate your entry into retirement in the years ahead. Book some time out in your diary once or twice a year to see if your investment choices still match your goals, appetite for risk and current circumstances, tweaking accordingly if needed.  

2. Think about moving your investments to one place 

If you’ve got ISAs and SIPPs dotted around with other providers, you might like to bring them together as it’s easier to manage them. You can learn more about transferring your investments here. Of course, it’s important to understand that pension transfers are a complex area and may not be suitable for everyone. Before going ahead with a pension transfer, we strongly recommend that you undertake a full comparison of the benefits, charges and features offered. To find out what else you should consider before transferring, please read our transfer factsheet. If you are in any doubt whether or not a pension transfer is suitable for your circumstances, we strongly recommend that you seek advice from one of Fidelity’s advisers or an authorised financial adviser of your choice.

3. Get help if you need it.

If you don’t fancy taking on the job alone or your finances are more complex, and you’re struggling to understand how you can make the most of your money, why not see if financial advice is right for you? The initial conversation is free and without commitment, so there's nothing to lose. During this chat, the adviser will explain the fee structure if you decide to proceed.

This first discussion helps determine if financial advice suits your needs. If it does, a financial adviser will offer personalised recommendations based on your goals, guide you in choosing investments, ensure diversification, and simplify complex financial matters.

Important information: Tax treatment depends on personal circumstances and all tax rules may change in the future. You cannot normally access money in a SIPP until age 55 (57 from 2028). This information is not a personal recommendation for any particular investment. If you are unsure about the suitability of an investment you should speak to one of Fidelity’s advisers or an authorised financial adviser of your choice.