Later Life Choices - Care Fees, Retirement and Estate Planning

09/11/2024

Until last week’s Budget, pensions were generally not included when working out the total value of your estate (property, savings, assets, investments, personal items) for IHT purposes. This means pensions weren’t normally subject to IHT.

Instead, a different type of tax regime applies. How much tax your loved ones will pay on your pension depends on how old you are when you die, though the rules are, as ever with pensions, complicated. Generally:

If you die before age 75: your pension can be inherited tax-free.
If you die aged 75 or over: your loved ones will pay income tax on what they inherit at their personal tax rate (for example 20%, 40% or 45%).
However, the Chancellor has now announced that most unspent pension funds will form part of your estate from April 2027.

This means the value of your pensions when you die will be added up with your other assets to calculate whether your estate will pay IHT. If the value of your estate is above £325,000 (or £500,000 if you’re leaving your home to a direct descendant), any pension funds above that threshold will be liable for IHT at 40%.

How does inheritance tax currently work?

As it stands, you're not charged IHT on anything you leave to a spouse or civil partner after you die.

And even if you leave part, or all, of your estate to someone who's not a spouse or civil partner, IHT is not charged on the first £325,000 of your estate, a threshold that rises by £175,000 to £500,000 if you're leaving your home to a direct descendant, such as a child or grandchild (as long as your estate is worth less than £2 million).

Married and civil-partnered couples can also pass on any unused IHT allowance to a surviving spouse or civil partner – potentially increasing their IHT tax-free allowance to £1 million.

Anything above your IHT tax allowance is charged at 40% (unless you’re leaving anything to charity, which is taxed at 36%).

The good news is that there are ways to plan to reduce your IHT liabilities, and we can help you do it. Please get in touch on 07925010865 or through the office on 0800 195 1066.

15/10/2024

When asked about what our most valuable asset is, we will often think about our material wealth. However, I challenge you to consider - What would happen to all those material things if something were to happen to you?

So, why is it that only 35% of adults have life cover compared to 75% of adults having motor insurance, or, 73% of adults having house and contents insurance?

I'll leave you with that thought....

08/10/2024

If you find yourself in a position where you're able to claim on your critical illness cover, there are many ways you can use that money to improve your life.

You could adapt your home to make it easier live with your condition. Or you may need or want to take time away from work to recover - your payout could help cover your living costs. You could pay for private treatment or even use the money to pay off your debts. Being able to pay off your mortgage or loans can give you a great deal of peace of mind and the breathing space you may well need.

Give me a call on 07925010865 or 0800 195 1066 if I can be of any assistance.

03/10/2024

There will probably be times in your life when you're not sure what to do with your money or how to plan best for your financial future. It can seem overwhelming at times to see so many financial products on offer.

If you have little experience of dealing with finances or you're confused about making a decision with your money, it may be helpful to get professional financial advice.

A financial adviser can help with things such as:

Investing or saving money

Planning for your retirement

Equity release

Making the best of a lump sum/inheritance

Trusts

Inheritance tax planning

For any further information, please call me on either 0800 195 1066 or 07925010865.

12/09/2024

Continuing on the theme of pensions for , I thought it would be good to cover the options for those of us who are not employed.

If you’re self-employed, saving into a pension can be more difficult than for people in employment. There’s no one to choose a pension scheme for you, no employer contributions and your income probably fluctuates. But there are many advantages to having a pension.

Most self-employed people use a personal pension for their pension savings.

With a personal pension, sometimes called a private pension, you choose where you want your contributions to be invested from a range of funds the provider offers.

The provider will claim tax relief at the basic rate of tax on your behalf and add it to your pension savings.

How much you get back depends on how much is paid in, how well your savings perform, and the level of charges you pay.

If you’re self-employed you can also use Nest (National Employment Savings Trust). Created by the government, it’s run as a trust by the Nest Corporation. This means there are no shareholders or owners, and it’s run for the benefit of its members.

Although Nest is primarily for people who are employed – they also allow self-employed people to save with them.

All different schemes have their pros and cons.

If you’re not sure which scheme to save with you could consider talking to a regulated financial adviser such as myself. We could have a chat and then I'll make a recommendation based on your specific needs and circumstances.

For more information, call me on 07925010865 or through the office on 0800 195 1066.

10/09/2024

Good evening! Did you know it's ? Did you also know that around 1.5 million people are employed by the NHS, making it the countries largest employer. If you are one of the 1.5 million, understanding the complexities of your NHS pension is crucial for planning your retirement. You may be wondering how much your NHS pension is worth? Or even whether it's final salary or a career average pension.

The exact amount of your NHS pension depends on various factors, such as length of service, earnings and the specific pension scheme you’re enrolled in. There are three different pension schemes in place, but most NHS employees who are still working are in the NHS Pension Scheme 2015. There’s also the NHS Pension Scheme 1995 and the NHS Pension Scheme 2008, but they’re both closed to new entrants. The easiest way to find out how much you’ll get from your NHS pension is to follow the following link to request an estimate.

https://www.nhsbsa.nhs.uk/member-hub/getting-estimate-your-pension

If you think you need any further help or assistance with your NHS pension or any other pension, please don't hesitate to get in touch on 0800 195 1066 or 07925010865.

10/09/2024

Follow the link to check your benefits if you're concerned ⬇️

Winter Fuel Payments are changing, but you may still be eligible.

Check your benefits entitlement now. Use the Age UK Benefits Calculator: https://bit.ly/3AX3KNV

06/09/2024

Get checking folks....

Winter Fuel Payments are changing, but you may still be eligible.

Check your benefits entitlement now. Use the Age UK Benefits Calculator: https://bit.ly/3U3lnl6

12/08/2024

Getting an adviser when you’re building your retirement savings or retiring can help you make the right decision for your specific personal situation. And sometimes you have to take advice. In that case, it is very important to make sure you are using a regulated and impartial adviser. You can use the Financial Services Register to check the credentials of who you are using to ensure they are regulated by the Financial Conduct Authority. Using an authorised firm, with the correct permissions, will greatly reduce the risk of harm.

https://register.fca.org.uk/s/

For more help or information, please call me, Jeremy, on 07925010865 or through the office on 0800 195 1066.

06/08/2024

Drawing from your pension is a big decision, and can also lead to unintended tax charges if not done correctly. Before accessing your pension, it is prudent to get advice from a qualified professional financial adviser, such as myself.

Why not get in contact for a review?

Drop me an email on - [email protected] 💻

or

Give me a call on 07925010865 / 0800 195 1066 ☎

01/08/2024

According to research by Scottish Widows, 78% of pension savers dip into their pension pot before retirement. This can leave some of them exposed to running out of money in later life.

While early withdrawals are often an unavoidable necessity, draining a pension pot too soon does have associated risks.

For more information, please call 07925010865 or 0800 195 1066 ☎

30/07/2024

The problem with estate planning is that some people believe it to be a very complex area of financial planning while others simply don't want to even consider their own mortality, let alone plan for it. The truth is that estate planning can be as straightforward for some as arranging their will or even heading off to the registry office to become legally married.

Whether your affairs are simple or complex, it is worth getting advice from a specialist retirement planner in order for your wishes to be protected rather than opening your assets to risk.

For more information, please call me, Jeremy, on 0800 195 1066 or 07925010865 ☎