Retirement Planning

jcton

i am 59 years old, i work and earn £17,000pa i have worked for same company for 25 years and is a member of a final salary scheme on an 80th basis with Normal Retirement Age of 60. i also receiving a widow’s pension of £14,000pa from husband’s occupational pension. i live with my son and his wife but i received £1000pm from my property which is fully paid for, which i put into an Investec UK Blue Chip OEIC, Current Valuation £37,440. (pay for long term residential care should i need it in old age). i also have £20,000 in an 8pc 2015 Gilt.

i have recently been diagnosed with Parkinson disease and am worried about my assets and long term care.

i have an appointment with my solicitors and a financial adviser in a few weeks but just looking for some outside advice.

My property will be passed on to my son but should it be done now to avoid any tax etc?
Should i hold on to assets even though my illness may suddenly progress and what tax will be charged?

Just looking for ideas for peace of mind, not going to make any decisions for a few months.

Cautious_Investor_3

Hi

You have not said anything about the value of your house.

Your financial adviser and solicitor will be able to advise you more fully.

However I would consider the following:

1. Make a will and ensure powers of attourney are in place (everyone should do this, just good planning)

2. Think about when you may need care and then about how much this may cost in the future

3. The have a think about how much income you can get from your various pensions and investments, how does this compare to what you need?

4. Ask your IFA to consider options other than just taking income from your final salary scheme. Most times you are better taking the income directly from the scheme, however in your case a transfer into an alternative retirement vehcile may give you a higher income due to your illness and your estate a lump sum on your death.

Sorry to hear about your illness, take time when making decisions, there is no rush, but do spend time looking at your finances, the decision you make will be important for your future.

I hope this helps.

Tha Cautious Investor

jcton

value of house is between £525,000 and £575,000

Linton

I know that people can live with Parkinsons for decades but may need significant care as the disease progresses so I would suggest that you keep the house and sell when/if necessary (or downsize now and invest the gain) to ensure that your old age is as comfortable as possible.

IMHO any inheritance should be a secondary concern.

As Parkinsons can last a long time, I would suggest that you keep the final salary pension.

Otherwise agree with Cautious on points 1-3.

Cautious_Investor_3

Linton wrote: »

As Parkinsons can last a long time, I would suggest that you keep the final salary pension.

You may well end up keeping the final salary scheme as they do carry valuable benefits. I'm just saying get your IFA to look into whether a transfer into an alternative retirement vehicle e.g. enhanced annuity, fixed term annuity, drawdown etc would be advantageous.

Not saying you should transfer, just saying you should look at the options. Afterall with the new rules post April, you may be able to drawdown the money from the final salary scheme (if you did transfer it into say a drawdown plan) at a greater rate than you could have done previously which may help you care. Again, just saying this is something to look into.

The Cautious Investor

sleepless_saver

Giving away the house doesn't sounds like the best course. Assuming you continued to live there, you would have to pay market rent for it not to be considered a gift with reservation, plus you would have no security of tenure which could be affected by things like marriage breakdown, financial problems etc.

And as you would have given it away knowing you have a progressive health condition, you could well be considered to have deprived yourself intentionally of capital as and when you are assessed for what you can pay towards care costs.

This is also a good time to think about how well the accommodation you have in your present home will suit your needs in the medium/longer term now that you have Parkinsons.

rabbitmumu

You may also contact your current final salary scheme, and see what they can do for ill-health members. In extreme cases (medical condition subject to their approval) you maybe able to get an ill-health pension (which will be a lot more than your normal pension and/or obtain it immediately), or you can take the full value of your pension as a lump sum.

geoffgeofftygeoff

It's already been mentioned but just to say the information on Lasting Power of Attorney can be found here:

http://www.publicguardian.gov.uk/arrangements/lpa.htm

Note, there are two types (health/welfare & property/financial affairs) and I believe it is recommended for everyone to have these in place; although many don't (it's on my to do list). It might be useful to ask your advisers for more information on this.