At Clifton Wealth Management we are passionate about making pensions relevant and engaging for young adults starting out on their career paths. By helping them to get onto the property ladder much sooner than they ever thought possible would go a long way to do exactly that.
Last year, we put together a detailed proposal to HMRC, catchily titled “Accelerating home ownership for first time buyers and increasing pensions engagement amongst the younger workforce”.
Within the document, we made it clear that a policy of this type could be a natural extension of the pension freedoms regime and by using the efficiencies of pension saving to increase home ownership amongst young people we would have significantly advanced the prosperity agenda since pension membership and home ownership are the two main planks of an individual’s long term financial security.
For many young people, buying their own home and regularly saving into a pension from their take home salary is unrealistic and therefore the deposit savings tend to take priority, leading to significantly diminished pension prospects in later life.
Our proposal included a blueprint for how this should eventually be repaid and the effect on the overall long term financial standing of the individual as well highlighting generous tax reliefs and employer contributions that can accompany such arrangements.
Our recommendations, were seemingly well received at the meeting with HM Treasury but, as is often the way with these things, not much happened thereafter.
Out of the blue, in a think tank meeting earlier this week (June 3rd), the Secretary of State for Housing, Communities and Local Government, James Brokenshire, said that he thought that our idea should be taken forward and that young savers should be allowed to use their pensions to fund housing deposits.
James even went so far as to say that he will be encouraging whoever takes over as Prime Minister to make this initiative a reality, thus improving the life chances of thousands of young people.
Adam Tavener, Clifton Asset Management chairman, stated: “Well I must say, I am extremely pleased that our suggestions have surfaced with support at such a senior level. Having been instrumental in getting the SME bank referral legislation passed, which is now helping thousands of small businesses, it would be just great to have been instrumental in bringing about similar change for aspiring first time buyers“
“Fingers crossed but we could be on for two out of two when it comes to getting our ideas passed into law!”
Adam first publicly suggested this initiative way back in October last year on his YouTube channel, “Tav On Money” where Adam discussed the proposal in detail. To view, click here
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