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Plan Later Years

The plans you need to make for retirement are complex, with many options to consider. What is needed more than just a qualified financial adviser, is somebody who you can rely on to fully understand your situation and help guide you through making important decisions.

We firmly believe that these issues should not be faced alone. We recommend that you consider involving family members in our discussions; in fact we would prefer it if you did.

Financial advice should take you to the stage where you can make clear and informed decisions, happy in the knowledge that you had all the information you needed to choose the right option for you.

Inheritance tax planning

Inheritance tax (IHT) is due if your estate – including any assets held in trust and gifts made within seven years of death – is valued over the IHT threshold. Assets above the threshold are taxed at 40%. However, careful planning can mitigate some or all of this potential liability.

Possible solutions include:

  • Annual exemptions
  • Potentially exempt transfers
  • Normal expenditure out of income
  • Gift into a trust
  • Gifts to charities
  • Gift but retain income
  • Retain capital but give away growth
  • Residential nil rate band
  • AIM shares
  • Enterprise investment scheme
  • Insuring the liability

Please note: IHT planning is not regulated by the Financial Services Authority

Equity release

Equity release allows you to benefit from the value of your home without having to move out of it. These solutions are generally available to homeowners over the age of 60.

There are two main types of equity release schemes:

Lifetime mortgage involves releasing money from the property by taking out a mortgage, usually without repayments. Instead, the interest is rolled up on a compound basis and added to the outstanding loan. You or your estate then receives the proceeds of the house sale, less the debt, when the property is eventually sold.

Home reversion plan involves selling all or part of the property at a discounted market value. In return, a tax-free cash sum(s) is paid and you retain the right to live in the property, rent free, for life. At the end of the plan, you or your estate will be entitled to a proportion of the net sale equivalent to the share in the property that has not previously been sold.

Choosing the most suitable scheme and the most suitable provider will depend on many factors, which is why specialist, independent advice is essential.

Please note: This is a lifetime or home reversion plan. To understand the features and risks please ask for a personalised illustration

Long-term care

One in four of us are likely to need long-term care at some stage in our lives. As an ageing population, the number of people needing care, or who will need to become a carer for a family member, is set to increase in the coming years.

What isn’t clear is how much support the local authority and the NHS will offer us. It’s only when we need it that we realise planning is essential to understand the range of choices available, to get the right kind of care in place.

You may receive help towards the costs of care depending on your circumstances. If your income and savings are low your local authority will pay some or all of your long-term care costs. You may also qualify for Disability Living Allowance if you are under 65 or Attendance Allowance if you are over 65. Attendance Allowance cannot normally be paid if social services or the NHS is funding your care in a care home. Although social security benefits are the same throughout the UK, other help provided by local authorities varies.

There are many ways to help you cover the cost of care, including using savings, investments, property and different types of long-term care insurance.

Please note: Long-term care planning is not regulated by the Financial Services Authority

Plan Money Ltd © is authorised and regulated by the Financial Conduct Authority and is entered on the FCA register (www.fca.org.uk/register) under FRN 605911.
Plan Money Ltd © registered address is: Bentley House, Forge Lane, Gt Bentley, Colchester CO7 8GD. Registered in England and Wales No: 5583593.
The information contained within this website is subject to the UK regulatory regime and is therefore primarily targeted at consumers based in the UK.

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