Since you ask

Feb 14 2006

By Peter Rutherford, The Journal

Your money queries answered by Peter Rutherford, chief executive of Rutherford Wilkinson plc, independent financial advisors. Mr TC from Durham asks I have been talking to some of my colleagues at work and I believe that it will be possible from April to draw my pension but continue to work. Is this correct? Answer The new pension rules that come in from April 6 will certainly allow this, but it will depend upon the type of pension scheme that you are in. For example, if you are in an employer-sponsored scheme (whether money purchase or final salary), it will first of all depend on whether the trustees of the scheme change their scheme rules to allow this to happen. Also, if they did, there are a number of downsides to this course of action. For example, you would lose out on your employer contributions to build a better pension for the future. Also, you could cease to receive additional benefits such as death-in-service cover. My advice is that you should not consider taking any action without first talking to an independent financial adviser. Mrs CR from Ponteland asks I have some Northern Rock shares which seem to have gone up a lot recently. I got 500 shares when they floated so, if I sold them now, would I have to pay any tax if I decided to sell them? Story continues ADVERTISEMENT Answer As an individual you are allowed to make a capital gain in this tax year of £8,500. Providing you do not sell any other assets which are subject to capital gains tax (CGT), where in total your profit exceeds £8,500, you should not have a tax problem. Mr AW from Cramlington asks I initially regretted investing £7,000 into an equity Isa in 2002 as it went down in value. However, I am very pleased I did not panic and sell as it is now showing a significant profit. As I do not need the money in the foreseeable future I am happy to leave it, although in the back of my mind I do worry if the markets should fall again. Can you advise what I should do? Answer I would need to know further information regarding other investments you may hold, and also discuss your attitude to risk before making any specific recommendations. However, you could consider switching the profit you have made within the Isa wrapper into alternative lower risk funds, such as property or corporate bonds. This will add diversity to your investment in the event of equity markets falling. ********** Investors Guide is a booklet with information on all aspects of investment and is available to readers. To apply for your free copy, freephone 08000 745 489 or write to me at Rutherford Wilkinson Plc, 21-23 Bridge Street, Morpeth, Northumberland, NE61 1NT. Please also write with any queries you would like answered. Rutherford Wilkinson Plc is authorised and regulated by the Financial Services Authority.

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