Fashion designer Karen Millen reveals her pension has been a 'godsend' after ... trends now
Fashion designer Karen Millen says she is glad she saved into a pension after taking part of it as a tax-free sum when she went bankrupt.
The clothing genius, 61, praised the retirement fund staple as she spoke about rebuilding her finances after her famous firm went bust.
She lost huge amounts of money during the financial crisis in 2008 when the Icelandic bank Kaupthing collapsed along with large sums it had invested for her.
It sparked a huge legal battle that ended up costing some £3million.
Then she was blindsided with a £6million bill from HMRC over a tax avoidance scheme she had believed was nothing of the sort.
Unable to pay, she went bankrupt in 2017, a decision she said was very difficult to make. It meant she had lost the £40million she had made from her business.
She told This is Money: 'Deciding to lie down and let it happen to me was the only way I could move on. I've never actually added up everything I lost. But I can say that I lost everything that I received from selling my business. I ended up with nothing, except my pension – and that has been my saving grace.
'Pensions are excluded from a bankrupt's estate. Mine's not huge, but it's been a godsend. I have taken part of it as a tax-free lump sum.
Fashion guru went bankrupt in 2017 but is rebuilding her finances once more after huge tax bill
After going into administration in 2019, the online branch of the business was bought for £18.2 million in August 2019 by Manchester-based company Boohoo
'I remember thinking, when I was saving into it, that it was irrelevant. Now, I'm pleased I did it. I look at the state pension and think: how do people cope on that? It's really important to have a private pension. I wish I'd put more in, in hindsight. However, I'm fit and healthy so I'd like to think I can work for at least another ten years.'
After going into administration in 2019, the online branch of the business was bought for £18.2 million in August 2019 by Manchester-based company Boohoo — the online 'fast-fashion' outlet for 16 to 25-year-olds, which also owns Coast and PrettyLittleThing.
The buy-out came just two years after Karen had been declared bankrupt in the High Court.
Now she is renting a cottage in Kent and says she has become very hands-on with her money.
She said: 'I trusted others I felt were better qualified to take care of it. I didn't get the right advice. Whether it was investments, putting money into offshore accounts,