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Hit new heights in 2014 with a money makeover: Your complete guide to coping with the big changes heading your way

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PENSIONS

Two million people are expected to be automatically enrolled into a workplace pension next year.

Employees will be moved into a scheme according to a ‘staging date’, which depends on the size of the company – for businesses employing between 350 and 499 it is next month, whereas for companies with 59 staff members it is November. To find out how this affects you visit thepensionsregulator.gov.uk.

While we are all being encouraged to save more for retirement, stricter controls are being imposed.

The limit for annual contributions into a pension will be lowered from £50,000 to £40,000 in April and the lifetime allowance will fall from £1.5 million to £1.25 million.

For those already retired, the basic state pension will rise to £113.10 a week from April.

BORROWING

Help to Buy, the Government’s flagship scheme for assisting people on to the housing ladder, steps up a gear next month.

Its second phase is for people buying old or new homes up to a value of £600,000 and allows borrowers to pay just a 5 per cent deposit.

Although some offers have already been announced, the funding only becomes available in the New Year. There is a dedicated website with further details at helptobuy.org.uk.

But the Funding for Lending scheme, which provided cheap lending for banks and building societies from the Bank of England, will terminate in February, which could push borrowing costs higher.

To find a cheap mortgage or loan while rates are still low, visit comparison websites such as MoneySupermarket and GoCompare – or check out our best buy tables.

Meanwhile, responsibility for the controversial payday loan sector will fall into the hands of the Financial Conduct Authority in April.

Final rules for how it will govern lenders – which are often accused of charging exorbitant rates and fees and for lending to people who were unlikely ever to be able to repay – are due in February.

WE’VE SAVED OUR WAY TO THE GREAT WALL OF CHINA

Hitting new heights: James and Marian Spence Hitting new heights: James and Marian Spence

James and Marian Spence are looking forward to a bigger Isa allowance in April.

The couple, from Skegness, Lincolnshire, save the maximum permitted each year and use the interest earned to help fund their retirement.

It means they can live to the full with hobbies such as rambling, dancing and travel – from a cruise trip to the Iberian Peninsula and Morocco to walking on the Great Wall of China.

Earlier this year they moved money into an instant access Flexclusive Isa with Nationwide, paying 2.5 per cent, which was ‘reasonable in this climate’, says James, 68, who is a retired printer.

He and Marian, 66, who is retired from her job as a dressmaker, say they would like the annual allowance to be even more generous. ‘The allowance doesn’t seem to go high enough,’ says

James. ‘We’ve always saved – first with Tessas and then graduating to Isas – ploughing money into our accounts as and when we can.’

 

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By Laura Shannon, Financial Mail On Sunday

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