Estate Planning and Later Life….
In later years, getting our financial planning arrangements in order becomes all the more important as we head towards a costly period of life—post retirement and into older age.
At Brighter, our advisers help plan this important period of life to make sure that later years can be made all the more comfortable for our clients. Below we have listed just some of the areas where we can help but this list is not exhaustive:
Starting a pension…
Retirement may feel like a long way off for some but putting off saving into a pension means that you are missing out on a valuable tax-efficient way of saving and drawing a retirement income.
Ensuring we help you meet your financial needs into your later years
When we work with our clients to develop a financial plan for them we ensure that their savings and investments will last them into their later years. We do this by a number of means:
The new main residence tax allowance was introduced in 2019/20 and has now risen to £175,000. This coupled with the £325,000 inheritance tax allowance means that a person now has a total of £500,000. The nil rate bands of inheritance and main residence tax can be passed to the spouse or children on first and second death, respectively.
So let’s just say that David and Sheila are in their late 60’s and still live in their family home, although their children have grown up and moved away.
Of course David and Sheila are delighted with this outcome but they have some queries with regards to their own set of circumstances:
There are a number of ways that you can consider how loved ones can be supported upon your death:
It is vitally important that you have identified a beneficiary for your pension so that it does not have to wait to be gifted via probate, which can be costly.
You should make a will as soon as you have dependants and assets that you wish your loved ones to have on your death.
If you haven’t already made a will, the later years are definitely a time when this should be considered. Some of the problems in dying without one are:
Lasting Powers of Attorney:
If you haven’t considered LPAs now is very much the time to do it, as the donor (person making the LPA) must have mental capacity in which to be able to grant someone else the right (attorney) to make health and financial decisions on their behalf.
There have been cases where young people have been left without physical or mental capacity where, in the absence of an LPA, decisions about their health and financial affairs have been left to the Courts which can be long drawn out and costly.
Executors of wills are different from LPAs and cannot deal with health and financial decisions on your behalf during your lifetime. As most people do not just die but have an illness before-hand, which could leave them incapacitated, it is wise to consider having LPAs in place.
Brighter Financial Services Ltd have a partner arrangement with a wills’ service to provide wills and LPAs free of charge to all our Service Plan 1 clients, but for any clients wishing to have a will and/or LPAs arranged we can help direct you to this service.
Whole of Life or Term Insurance can help to ensure that your loved ones can manage the main expenditure on death.