Archive for March, 2015

When Did You Last Check Your Credit Rating?

Tuesday, March 31st, 2015

When Did You Last Check Your Credit Rating?Whether or not you realize it, Experian, Equifax and Callcredit all have a huge impact on everyday life in the UK. They are the “big 3” credit-rating companies. . Businesses use their services for a whole variety of reasons. For example some companies use them to confirm a person’s identity, particularly if they deal in age-restricted goods such as alcohol. Mobile phone networks also tend to check with credit-reference agencies before they hand out expensive contract smartphones. Some employers check them, particularly if a job involves dealing with money. This means that even if you have no intention of applying for any credit in future (not even a mortgage), it can still be a good idea to keep your credit record looking good.

Credit records are about more than just money

When thinking about brushing up your credit record, your first thoughts may be about how to manage the family finance (better) as this does indeed have an impact on your credit rating. For example late payments or being over limit on credit card will set your score back. At the same time, even those with a perfect financial track record and plenty of savings to draw on, can find themselves with poor credit scores for a number of reasons. Whatever you do, make absolutely sure you are on the electoral role as this is a major point during credit scoring.

Wrong data

Everybody makes mistakes and that holds true of credit-scoring companies. Ideally you should make a point of checking your credit record every year or so, to give yourself the opportunity to have any mistakes corrected before you feel any need or want to apply for credit. You should certainly check your file before making any significant application for credit (e.g. a mortgage).

Mixed messages

You fill in a form to apply for something and put down that you live in flat 6F. You fill in a form to apply for something else and put down that you live in flat F6. Your letters might still get to the right address but the computers at the credit reference agency might not make the connection. Even if you’ve always filled in your details in correctly, data from hand-written forms can be entered incorrectly and even forms submitted online can go wrong occasionally. Again, you can pick up these issues by checking your file.

Lack of closure

It’s fine to keep a credit card for emergencies, but if you only have a card because you’ve never quite got round to closing it, then close it. Very simply, every credit card you have on your file will be considered a card that’s available for you to use (which technically it is). This may impact how much money other lenders are prepared to offer you.

In short…

Having a good credit record is partly about general financial health and partly about making sure that your credit record is correct.

What The General Election Means For Your Wealth

Friday, March 27th, 2015

What The General Election Means For Your WealthWith the General Election now less than 100 days away, the contenders are throwing their economic hats into the ring. Although none of the 3 main parties has provided a manifesto as yet, they have all been giving their views on tax and spending and reducing the UK deficit. Here is a quick overview to where the three main parties stand on balancing the UK’s books.

The Liberal Democrats

The Liberal Democrats plan to increase the amount lower earners can take home by raising the personal allowance to £11K in their first year of office and then to £12.5K by the end of their (first) term. Whilst they, unlike Labour, have not (yet) suggested bringing back the 50p tax rate on incomes over £150K pa, the closeness of previous votes on the issue means that this could not be completely ruled out. What is being proposed for the moment is a “Mansion Tax”, which would essentially work in the same way as Council Tax but with the funds going to central government. Additionally the Liberal Democrats have suggested increasing Capital Gains Tax to 35% (from 28%). This would potentially affect people who own second homes (e.g. buy to let landlords) as well as those who own other forms of investments such as shares. Their aim is to have the UK back in the fiscal black by April 2018.

The Labour Party

One of Labour’s headline policies is to reintroduce the 10p tax rate as a bridge between the nil rate personal allowance and the 20p rate. At current time, however, they are yet to specify how much income would be included in this rate. They have, however, stated that the impact on government finances could be counterbalanced by withdrawing the Marriage Couples’ Tax Allowance. Labour plans to reduce the deficit by a combination of ending further borrowing to finance spending and an increase in various taxes. They have proposed reintroducing the 50p tax rate on incomes over £150K pa. They also support a Mansion Tax, although they are yet to explain how specifically, this would work. On the subject of houses, while Labour have, as yet, made no comment on Inheritance Tax, even taking no action could have a serious impact on many people. Rising house prices have made IHT a reality for increasing numbers of people. Unless the nil rate is raised at some point in the future, then the impact of IHT will continue to spread. Labour have also proposed a tax on banker’s bonuses. One policy which may prove popular with the electorate is a 5% pay cut for government ministers.

The Conservative Party

The Conservatives’ plan is essentially to reduce the deficit by cutting government spending. They too aim to have the UK back in the black by 2018. They plan to raise the personal allowance to £12. 5K pa (from its present level of £10.5K pa). Likewise the 40% rate would start at £50K pa (from its present level of 41.9K pa). Their stated aim is to have these tax changes in place by the end of the next parliamentary term. While this would not deliver any short-term improvements to higher-earners, it might not have an adverse impact on the family finances either. The Conservatives have not only made a commitment to a Mansion Tax, but have actively opposed it in the past. Likewise, while they have not many any pledges on Inheritance Tax, they have made recent changes to pensions rules from 6th April 2015 which effectively makes it easier and more tax efficient to pass on pension pots between generations. It is an open question as to whether or not the Conservatives will be able to increase the nil-rate band to reflect the impact of rising house prices. There is, however, no obvious sign that they would seek to lower the bands.

How To Protect The Value Of Your Home

Wednesday, March 25th, 2015

How To Protect The Value Of Your HomeA decade ago, adding value to most properties was simplicity in itself, you simply bought a house and waited. This was during an unsustainable housing market boom that ended in an epic slump and it isn’t one we should be hoping for again anytime soon.

Protecting your home’s equity now takes more active involvement but home improvements needn’t be a complex, tortuous business if you follow a few simple rules.

Emotional buyers

After house hunters have considered their budget, they may choose the property that speaks to them on an emotional level.

People may buy based on how they feel, far more than they buy based on rational, logical thinking.

With this in mind, it is possible to create an attractive, sellable ambience in your home without spending a fortune.

First Impressions

Before house buyers see the interior of your home, they will see the garden, walk up the path and look at the windows and the front door.

All of these have the potential to kill a sale if they are in a poor state of upkeep, so it makes sense to start with some essential garden upkeep.

It might be a good idea to look at the exterior of your own home from the stand point of a potential buyer and think about what they might find appealing and what might be a potential turn off.

Decor

Some home owners believe that spending thousands on new bathrooms, conservatories, extensions and kitchens are the only way to add serious value to a home.

However, big spending home improvement projects eat into any profits you might make from a sale, so it is always a good idea to find cheaper, more effective ways of creating a fresh, bright, appealing atmosphere.

Firstly, de-clutter. You are in the business of creating a blank(ish) canvas that potential buyers can project their own personality on to. It’s hard to imagine living in a place that is full of someone else’s odds and ends.

Secondly a new coat of paint in neutral colours (don’t make any ‘loud’ statements when you are trying to sell) and some minimalist soft furnishings will make an enormous difference.

Jobs

What have you put off for months? How many leaky taps, dead light bulbs and half finished painting jobs are there around your home?

It goes without saying that you need to get these fixed if you don’t want buyers to assume you’re selling a cheap fixer-upper (they’ll still buy, but at fixer-upper prices).

The home you have lived in for years is your most valuable asset so it makes sense to maximise its value when you come to sell it. One piece of torn linoleum in the bathroom or a blocked gutter could cost you dearly.

Getting Help

It might be that DIY is not your strong suit, in which case, there is no shame in hiring an expert to help you with a few jobs.

2015 Budget Review

Friday, March 20th, 2015

FB - BudgetGeorge Osborne’s final budget before the election was in many respects an extended party election broadcast hyping the achievements of the past and holding out all sorts of promises for the future. So here’s what he’s got planned.

The State of the Economy

The big message was to convince voters that the economy is in safe hands with the Conservatives and that Labour would return the country to rack and ruin. He boasted of a Britain which is the fastest growing developed economy in the world at 2.6%, although that’s down from December’s forecast of 3%. GDP per capita was up 5%, employment was at record levels with 80% of those new jobs being full time and 80% skilled. Welfare bills were down, business investment was up and the north of England grew faster than the South.

It all played into his claim to be creating a recovery which benefited the whole country – not just London.

Finally he announced a sale of £13bn of assets in Northern Rock and Bradford and Bingley incurred by the bank bailout, which will be used to pay down debt. His message was simple: while Labour gave money to the bankers, the Conservatives were busy taking it back.

Taxes

Anyone who works for themselves knows the horror of those annual tax returns. Yesterday he killed off the tax return allowing people to access digital accounts and pay their bills off when they wanted.

This is not just about appealing to a key bunch of likely voters – it’s also about trying to haul in some of the mysterious missing income tax. Every year tax receipts are lower than expected. That’s either because people are being channelled into low paid jobs or because a certain amount of income is going missing.

By making it easier for self-employed people to pay their full share, he hopes tax receipts will be a little less disappointing in the future.

Once again the threshold beyond which people start paying tax is on the up. In 2015/16 it will rise to £10,800 and the year after that it will hit £11,000. Meanwhile the higher rate tax band will also pop up from £42,385 to £43,300. Corporation Tax will be cut to 20% in two weeks’ time.

Petrol duty is to be frozen with September’s planned increase scrapped in a move which he claimed would save people £10 every time they filled up.

Drinkers got their annual penny off a pint promise, while he cut 2p off whisky and cider and froze wine duty. Tobacco and gaming taxes remain unchanged and he also announced a new horse racing betting right.

Business

One of the biggest questions in the run up to the budget had been what he planned to do for the struggling North Sea oil industry. Plunging oil prices have seen major giants such as Shell and BP cut investment in this area, putting one of Britain’s key assets at risk.

He announced plenty of new measures for oil companies including a cut of the supplementary charge placed on oil producers from 30% to 20% and a new tax allowance to encourage investment in the area. The government will also be investing in seismic surveying to unlock hidden reserves of oil.

Another much hyped area received less attention than expected. Much has been made of the so-called Northern Powerhouse, with the Conservatives keen to show they are pushing more investment away from London. However, measures were a little vague. There was talk of more devolved powers to the regions, deal with Manchester Council to keep 100% of the money from the rise in business rates, a new rail franchise for the south west of England, reductions in the toll for the River Severn crossing from 2018 and a move to offer support for Wales and the Midlands.

There were also moves to get the financial services to pay more. Just as banks had benefited from public support during the crisis, he said, now it was only right and proper that they give something back. He announced the bank levy would rise to 0.21% which he argued would raise an extra £900 million in revenue. Tax avoiders also came into his cross hairs. A tax on diverted profits would target those multinationals which move their profits offshore

Pensions and Annuities

One of the most important announcements made today related to the pensions market. The changes that the government introduced to the pensions market in 2014, making annuities non-compulsory, will be extended by 2016.

George Osborne announced that pensioners who have already purchased annuities will be able to exchange them for cash, which will come as a further blow to shareholders of the already struggling annuities providers.

As of April next year, over five million annuity holders will be free of the restrictions that have forced them to keep their policies and will be able to sell the policy back to the provider.

Savers

The Chancellor announced more flexible ISAs. Anyone would be able to transfer money out of an ISA and back in without losing their tax-free allowance.

Lower rate tax payers will pay no tax on the first £1,000 of income earned through their savings while higher rate tax payers would pay nothing on the first £500 while pensioners would have more access to their annuities. The mantra is to increase help for savers and give them more power and more choice.

One of the big highlights, though, was the creation of a ‘help to buy ISA’ where the government promised to top up savings towards a deposit. For every £200 saved towards a deposit, the government promised to top it up with £50.

What was missing?

In his response to the Budget Speech Ed Miliband pointed out that there had been no mention of new investment into the NHS. Also missing in action was anything on the environment.

The Conservatives have long since dropped the slogan ‘vote blue, go green’, but this was a budget in which they tried to pretend climate change didn’t exist and people weren’t show to point that out.

No sooner had he sat down than #climate was trending on Twitter. Caroline Lucas, the Green Party MP, was quick to voice her discontent. “Just weeks after PM signs #climate pledge highlighting economic threat, not one mention of climate or carbon from Osborne #fail #budget2015.”

Instead this has been a budget designed for the Tories’ ground troops. It’s an attempt to convince those who might be worried about savings, their pensions and their income that there is light at the end of the tunnel.

This was, then, was an extremely political budget. Osborne tried to head off some of Labour’s major attacks by softening his line on public spending cuts and stealing Labour’s policy of reducing the lifetime pension cap from £1.25 million to £1million.

The speech was full of the usual slogans – such as Britain was “paying its way again”, “walking tall” or pinching a line from Bullseye by “staying in the black and out of the red”.

There was plenty for savers, pensioners and the self-employed.

When You Need Financial Advice

Friday, March 20th, 2015

When You Need Financial AdviceHuman beings, in general, are notoriously bad at calculating risk and weighing up reward, it’s almost hard wired into us.

Our survival, millennia ago, was based around our inability to think too much about the future and focus on ‘eating today’.

This, while useful hunting Mastodons, is less helpful when planning our financial futures and we may take key decisions in our lives without much thought to our finances.

This article will help explore some of the times when financial advice might make all the difference to our wealth and future happiness.

First Home

Before the 2008 crash, at the height of Britain’s property prices, the speed at which house purchase decisions were made reached epic proportions.

The availability of mortgages and other cheap credit in an economy based on an unsustainable housing boom resulted in countless first time buyers finding themselves, post crash, in negative equity.

Others found that when the ‘sweetheart deal’ mortgage rate they signed up to ended, their home became exceedingly expensive.

In both instances some financial advice might have prevented a lot of long term heartache.

The long term effect of negative equity or an expensive mortgage deal can be immense, being ‘trapped’ in your property that you can only sell at a loss or saddled with a huge mortgage obligation should be avoided at all costs.

You can often get mortgage advice from independent financial advisor as part of the overall cost of the loan you take out.

Marriage

People cringe at the thought of discussing money and finances along with the romantic side of tying the knot, but it is essential that you are realistic about the economics of marriage too.

Getting married, sharing a home, and potentially having children together means that life insurance, wills and inheritance and the ownership of shared assets all have to be considered.

Accessing financial advice is important at this point, as there are countless life insurance policies, critical illness covers, and other provisions to cover your individual needs to choose from.

Having an expert who can guide you towards the best deals might well save you money in the long run.

Divorce

Sadly, for many married couples, divorce too will be a significant milestone.

It goes without saying that during the complex and emotionally painful process of ending a marriage expert legal advice is necessary, but it is also important for both parties to have financial advice too.

You might experience a considerable decrease in your income as a result of divorce from your partner, or you might be the recipient of money in the divorce settlement.

You might be the partner who is obliged to pay out a large settlement, or the one who has most responsibility for ongoing child maintenance payments.

If you become the sole provider for any children from the marriage, you may need to consider your life insurance and critical illness cover.

You might already have these policies but they may need to be reviewed in order to reflect the value of any maintenance payments you receive.

A financial advisor can also offer guidance on the most effective way of investing any lump sum from the divorce so it continues to grow in value, and can be used to pay for education and university costs for your children, or add to your own retirement fund.

Some divorcing couples also need to disentangle their pensions and here a financial adviser can be invaluable.

Retirement

In savings terms, your retirement starts now.

Making sure we have an income that will sustain us after our working life is over is something that many people put off until their 30s or 40s, but the longer you leave it, the more costly it becomes.

If you are just starting out on the road to planning your retirement and you have no idea about what choices there are or what pension products to buy, getting some advice is a good place to start.

However, you might already have a portfolio of investments and a variety of pension pots that you have built up yourself.

In this case it might be important to find out whether you current pension providers or other investments are performing effectively, compared to the rest of the market.

A financial adviser will be able to give your portfolio an audit and suggest whether or not your money could be put to better use elsewhere.

Knowledge is wealth

The more expertise that is available to us, the better informed we are and the less likely we will be to make costly decisions that are not easily undone.

Financially, we only have so many options, money, and time, to spend investing it, so it is important not to rely on pot luck.

So if you have a significant milestone in your life fast approaching, you might find it useful to talk over your options with an advisor.

What The General Election Means For Your Retirement Plans

Wednesday, March 18th, 2015

What The General Election Means For Your Retirement PlansGeneral election time often creates both excitement and nervousness and for much the same reason – the prospect of change. With the battle heating up, the economy in general and pension reforms in particular look like becoming key battlegrounds in the approach to May 7th. With that in mind, let’s take a look at what the three main parties have indicated is in store in terms of retirement planning in general and pensions in particular.

The Liberal Democrats

At the moment, the Liberal Democrats’ proposals are still in “pre-manifesto”-stage, i.e. they are still to be made final. Current indications are that they plan to adopt a tax-and-spending economic strategy. Hence pension savers can expect there to be new levies on their pension pots. There will also be a reduction in the amount people can save tax-free in these pension pots. At current time, the Liberal Democrats are talking about capping them at £1M, which would be a reduction of 20% on the current figure.

The Labour Party

The Labour Party has also yet to release its manifesto; however it has shown itself open to reducing tax relief on pension contributions made by higher earners. Specifically it has mentioned targeting those earning over £150K pa and slashing the relief on pension contributions to 20%. Labour believes that this would raise over £1bn, which they say they would then spend on job creation. This is in addition to reintroducing the 50p rate of income tax to incomes of over £150K pa Labour have indicated that they are in favour of a mansion tax, which they say they would use to fund the NHS. As a final retirement-related point, Labour have also proposed abolishing the Winter Fuel Payment for the most affluent pensioners.

The Conservative Party

Again, the Conservatives have yet to release their manifesto. They have, however, stated that they are committed to “dignity and security” in later years. They also have a track record in government, which could give some clues to their outlook. First of all it was the Conservatives who introduced the “Triple Lock” pension policy, i.e. the guarantee that the state pension would rise in line with inflation, wages or 2.5%, whichever is the highest. While Labour and the Liberal Democrats are both in favour of this “in principle”, neither has, as yet, made a commitment to keeping the Triple Lock, whereas the Conservatives have guaranteed to keep it until at least the 2020 election.

Recently the Conservatives have removed the obligation to use a pension fund to buy an annuity, with effect from 6th April 2015. This means that pensioners can choose between the freedom of keeping control of their pension pot versus the security of an annuity. This has been the subject of some controversy; in that the elderly will splurge their earnings (possibly for the best of reasons) and thereby make themselves dependent upon state support in their latter years, particularly if they need long-term care. Given that the logic behind offering tax relief on pension contributions was essentially to ensure that people were able to save enough to have an income in retirement, it is an open question as to how Labour or the Liberal Democrats would respond to this if they were to form a government. They could choose to let sleeping dogs lie, they could choose to bring back the obligation to buy an annuity (albeit possibly at a later age) or they could use this change to justify changes to tax relief on pension contributions.

The Conservatives have announced other changes, which essentially make it easier to transfer pension pots between generations upon the death of the saver. Again, it is unclear whether or not Labour or the Liberal Democrats would continue to support this.

Don’t Leave It Too Long To Get Life Insurance

Friday, March 13th, 2015

Don't Leave It Too Long To Get Life InsuranceLife insurance can make the difference between people being able to focus on dealing with grief and people being forced to confront harsh financial realities at a hugely painful time. While the statistical likelihood of dying goes up with age, death claims even young lives. What that means in practice is that life insurance could very well be essential for anyone whose death could lead to financial hardship for people they love. In very simple terms, it’s too late to take out life insurance when you’re already dead. With that in mind here are some tips for arranging it.

Decide What Type of Cover You Need

Life insurance comes in two basic forms. Term Assurance provides cover for a set period. Whole of Life insurance, as its name suggests, will cover you until you die (assuming you fulfil the agreed conditions). In other words, Term assurance will only pay out if you die during the term of the policy. Whole of Life insurance is guaranteed to pay out at some point. It’s important to choose the right form of cover for your individual situation so this may be a good time to get some advice from a professional financial adviser.

Remember to review your level of cover

Change is a part of life and it needs to be incorporated into your financial planning. For example your first experience with life insurance may be when buying a home for the first time. On the other hand, when children come along their parents need to think about ensuring their family is provided for in the event of one or both of them dying. In this situation it may be suitable to obtain cover which increases over time to keep pace with inflation.

Home-makers need cover too

It’s easy to value earnings from employment, but it’s also important to remember the monetary value of home-making. You may need to think about child-care arrangements in the event of the death of the primary home-maker. You may also want to think about the value of the other tasks they perform such as cooking and cleaning.

Take action to make yourself an attractive customer

Nobody can stop the march of time, but we can take control of our lifestyles. Life insurance companies much prefer customers who are going to live to the end of the term or at least pay premiums for some years before they die. You can quite legitimately change your lifestyle and then either speak to your existing insurer or look for the best deal.

If you’re a smoker then by giving up you can add any savings you make on your life insurance to the savings you make on packets of cigarettes.

Make sure the payout method is effective

It would be rather ironic to go to the effort of arranging appropriate life insurance only to forget about making sure that the proceeds go to the right people in the right way. For those with a partner and children, the choice may be between leaving everything to the partner and entrusting them with the care of the children, or leaving the children money in their own right. This all depends on your own individual preferences and situation. In either case, however, writing the policy in trust can be a hugely helpful move for those left behind. In short it ring-fences the insurance payout from the process of probate, meaning that it can be accessed relatively quickly.

End Of Year Tax Planning 2014/15

Wednesday, March 11th, 2015


NISAs – End of Year, Part 2

Wednesday, March 11th, 2015

NISAs - End of Year, Part 2If one of your New Year’s resolutions for 2015 was to improve your finances and ensure that you maximise your savings, the new tax year is an important time.

New increased limits on tax exempt savings pots in the form of NISAs have come into effect and in the next month NISA providers will be offering the best deals in the hope they will get your business.

Therefore, if you haven’t got an NISA already, now may be the time to open one, and if you have one already, it might be worth considering how it is performing and whether you can get a better deal?

Start your new NISA

If you open a new NISA now you have until April 6th to use up your annual tax free savings allowance, meaning that if so far if you’ve deposited nothing in any NISAs you can use the full £15,000.

If you’ve already saved money in one NISA this tax year and want to shift it over to a new account with a better rate, you are free to do so and to top it up to £15,000.

Following April 6th 2015 you will have another full tax year to invest in, and the tax free limit for 2015-16 has gone up to £15,240.

In order to make the most of the opportunity you could save regularly and realistically, and it makes sense to consider channeling as much of your spare cash as possible towards your NISA.

Create a savings plan

The more of the tax allowance you take advantage of, the better, so in order to make the most of your NISA, you need to develop a sustainable savings strategy.

Firstly, if there are major outstanding unsecured debts like loans, credit or store cards, pay them off as quickly as possible as they will eat into your wealth quicker than you can save.

Secondly, once you’ve dealt with debt, you need to conduct a one month spending diary, examining where you are paying too much or what you are spending unnecessarily on.

From this you should be able to see where your money is going and what you can cut back on, and what can be saved.

For many people, the money audit is quite a sobering experience, but it should help you realistically see what your potential for saving actually is.

Check rates on older NISA’s.

When you’ve gone to the time and trouble to audit yourself like this, it makes no sense to allow money to slip through your fingers in other ways.

Now you need to audit any of the NISAs or other savings accounts that you already have, to make sure that they are working as hard as you are.

Keeping your wealth concentrated in the NISA that has the best rate is also essential if you have stocks and shares ISA, and in this case you need to make sure that the account has the lowest fees and charges you can find.

You can move the money to a new NISA with a better rate.

If you are looking for cash NISAs with the best rate or a stocks and shares NISA with the lowest charges, you might benefit from some professional financial advice.

THE VALUE OF INVESTMENTS AND INCOME FROM THEM MAY GO DOWN. YOU MAY NOT GET BACK THE ORIGINAL AMOUNT INVESTED
LEVELS AND BASES OF AND RELIEFS FROM TAXATION ARE SUBJECT TO CHANGE

THE VALUE OF TAX SAVINGS ON A NISA DEPENDS ON THE INDIVIDUALS’ CIRCUMSTANCES

Mortgage Options for Pensioners

Friday, March 6th, 2015

Mortgage Options for PensionersThe concept of making mortgage payments after retirement age may be a new reality for some people. When looking at this situation, be aware that you can always get advice from a professional financial adviser to help you find the solution that’s right for you.

Decide Whether You Are Ready to Downsize

There was a reason why you chose the home you live in rather than any other but that reason may no longer apply. Children’s bedrooms may now be spare rooms and a train station nearby may be less important if you are no longer going in to work every day. The internet has helped make it possible to keep in regular contact with family and friends even over significant distances. If you are really attached to your home for reasons which still apply then it makes sense to examine your options for continuing to pay for it. If, however, time has changed your situation, then moving to a more affordable home may be an appropriate course of action.

See If Your Home Can (Help to) Pay for Itself

The rent-a-room scheme currently allows resident landlords to earn up to £4,250 per year tax free from letting out furnished accommodation in their own home. Although the tax-free allowance is for the whole year, there is no requirement that the accommodation be provided for the whole year. It is perfectly acceptable to provide summer holiday lets to tourists or language students or “Monday to Friday” lets to business people. There may be other ways to earn money from your home, for example by letting out your driveway as a parking space, although some of these ways may be subject to local authority approval and/or regulation.

Remember That There Is a Difference Between Retirement Age And Retirement.

The Equality Act of 2010 means that it is illegal for companies to force people to retire purely on the grounds of age. This means that in principle it is possible for people to go on working for as long as they want (or need) to. How feasible this is in practice will depend on a number of factors, including your overall health and the physicality of your job. If, however, you are close to paying off your mortgage, working a few years longer may be an effective solution.

Make Your Current Mortgage Work Harder

Keeping tabs on your family finances can go a long way to avoiding problems or at least catching them early and having more time to deal with them. One way to reduce the challenge of having to make mortgage payments in retirement may be to make overpayments while you still have an income from employment. This may require making savings elsewhere.

Get A Better Mortgage Deal

Another possibility may be to switch to a better mortgage deal. The key to this approach is to make the switch early enough for the savings to outweigh the cost of arranging the new mortgage. It’s also worth remembering that arranging mortgages requires paperwork on the part of the lender as well as the borrower. Therefore lenders may require borrowers to agree to a minimum mortgage term and/or minimum amount. Essentially this is to make sure that they earn enough from the deal to justify their initial investment of time, effort and money to set it up.

Consider Equity Release

In equity release schemes, a business essentially buys a share of your house and you continue to live in it until you die or move into a care home on a permanent basis. The advantage of these schemes is that you get cash up-front, which may help to pay off a mortgage. The disadvantage is that you may find the sum offered to be less than the open-market value of your home. These schemes should be looked at with care and ideally with the help of a professional financial adviser.

YOUR HOME MAY BE REPOSSESSED IF YOU DO NOT KEEP UP REPAYMENTS ON YOUR MORTGAGE

 

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