Later life matters

They say that life begins at 40, well later life begins now.

Laying a solid foundation for retirement and beyond is fundamental to ensuring financial stability both for yourself and your family, as well as future generations.

Equity release, whilst not suitable for all, is a way of releasing capital from your home without the need to sell your property. The most popular form of equity release is a lifetime mortgage.

Many lifetime mortgages contain no obligation to make monthly mortgage repayments, and the loan is repaid when you sell your property, move into long term care, or die. Most later life mortgage products are available to those aged 55 and over but this can vary depending on the provider, and it is crucial to obtain independent financial advice before proceeding with any form of equity release to ensure that it is the most appropriate option for you and your circumstances.

The funds released are most commonly paid as a lump sum and can be used for a multitude of purposes including home improvements, travel, a new car.

Due to the nature of a lifetime mortgage, the interest is rolled up and settled with the capital balance upon repayment. Most lifetime mortgages backed by the Equity Release Council will include a no-negative equity guarantee, which means that you will never owe more than the value of your home.

The Birketts view

It is important to discuss any plans to obtain equity release, not only with a financial advisor, but also with potential beneficiaries of your estate. This will help prevent disputes by your beneficiaries when you have passed, as they will already be aware that payment of the loan will need to be made from the estate assets.

Obtaining equity release may affect your estate in other ways. Our private client team can advise and assist with all aspects of estate planning, including will drafting, creation or amendment of trust arrangements, as well as Lasting Powers of Attorney and much more.