Call to make saving simple

RADICALLY simplified schemes are needed if UK savers are to be persuaded to bank their money.

A new report suggests pensions and ISAs should work together, while people should also be given access to their pension before they retire and be able to leave unused pension savings to their heirs tax-free.

According to the Centre for Policy Studies, the UK's long-term savings regime is overly complex, with multiple tax regimes, and this deters people from saving.

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New proposals include introducing a single, annual contribution limit of 45,000 for all tax-incentivised saving, whether the money is paid into an ISA or a pension.

Maggie Craig of the Association of British Insurers, said:

"The UK urgently needs to build a better savings culture and to repair the bad changes introduced recently."