The simple answer is yes… and no. You certainly shouldn’t buy one directly, particularly if you have other income. We have to be very conscious of taxable income in this country and you don’t want to break into the higher tax level as you will end up with less net income – i.e. less money for you and your family to enjoy. So always remember to ask yourself why would I buy something that generates more taxable income?

However, if you’re not comfortable with alternatives such as equities, maybe do buy but consider using your pension fund. In doing this you will maximise your current tax position and all income accumulates tax free. OK, you do pay tax 20 years later when you withdraw your funds but hey, all things are uncertain in life except death & taxes. There’s no escaping taxes but if you have a choice between now or 20 years later, I know which one I’d chose!

One bank is now lending to personal pension funds so leverage is available – therefore no excuses.