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Britain’s financial woes are, unfortunately, far from over.

Well over 12 months of high inflation has seen costs rising untenably, whether in supermarkets or wholesale. Between energy costs and grocery shops, spending power has been reduced and the importance of long-term financial literacy rendered more important than ever before.

But being smart with one’s money means more than putting a little away in your piggy bank. In the medium term, this money can become devalued for not having outgrown inflation. Meanwhile, tax obligations can further reduce your ability to save maximally. What products, then, are the best to use in smart money management?

Individual Savings Accounts (ISAs)

The most popular and accessible form of tax-free investment product comes in the form of the individual savings account, or ISA. ISAs are tax-free accounts in that any interest earned on money held in an ISA is tax-exempt – according to a tax-free allowance threshold set by the government. That threshold is currently £20,000, any deposits above which do not enjoy tax relief.

ISAs take a number of forms, with easy-access accounts offering relatively low rates of interest in comparison to ISAs that lock funds in for a period of time. ISAs can also be used as vehicles for investment in stocks and shares, where any capital gains are tax-exempt to the above threshold.

Venture Capital Schemes

Venture capital schemes are ideal routes through which to invest in start-up businesses in the UK, and can indeed be a fast track to rampant growth in returns if done carefully. Such schemes also benefit from significant tax relief, whether in the form of Capital Gains Tax on investment gains or Income Tax relief against the investments themselves.

If you helm a business, it can be even more important to think carefully about where your money is saved; not only are you thinking about overhead and wholesale costs, but also profit growth and footprint. An Enterprise Investment Scheme is a particularly lucrative scheme for retail businesses looking to invest profits where they can.

The scheme enjoys the tax reliefs offered by venture capital schemes and offers a solid foundation on which businesses can build a diverse portfolio of investments with little active attention. Of course, as with any investments, venture capital solutions adopt a degree of risk proportionate to the industry you’re investing in.

Your Pension

Lastly, but perhaps most importantly of all, your pension is a formidable financial tool when it comes to long-term financial security. If you are a salaried worker, your pension plan is the most effective way to grow savings passively. Maximising contributions allows you to significantly increase the amount you accrue, with employers adding a percentage of your wage alongside your own – and with tax relief adding 1% of your wage to the pot as well.

Overall, looking for valuable investment opportunities can be a useful strategy to have when it comes to managing your personal finances. There are various personal investment options in the UK which are always worth exploring and help you to yield a generous return on investment, particularly during times of economic uncertainty.

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