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Georgina Kitteridge writes on

Pension shake-up
2015. The year of far reaching changes

You may think you have heard this before but the new pension and ISA rules have implications for everyone whatever your age.  Our pension is no longer something we think about as we near our mid 50s. There are a number of choices and I have outlined these for you

The new pension and ISA rules, even if you are under age 55, means its a good time to review your finances..

Did you know ?
Pensions can now pass down to your children tax free up to your 75th birthday. So should you leave the fund to grandchildren who may be non-taxpayers?  
Depending on the size of your pension fund you might then decide to leave some to the kids, some to the grandchildren and the rest to your spouse.  Please however remember that your spouse can inherit your pension fund, draw income from it and leave the fund to the children/grandchildren on their demise etc. But how do you do this?

On death ISA accounts can now be transferred to your spouse and keep their tax free status. So how do you leave your ISA account to your spouse?

Your pension fund is actually held under a form of Trust. On your demise the Trustees decide who will benefit from the funds available. They will take into account your wishes if they know them and consider them within their overall brief. How do you do this? 

You can make the Trustees aware of your wishes by completing an “expression of wish” form, but clearly a lot of thought and perhaps advice might be called for before completing and signing it.

To transfer the ISA allowance to a spouse on ones demise is quite simple really. The spouse claims from the provider of the deceased’s ISA, an allowance equal to the value of the deceased’s ISA account on their date of death. It makes sense then not to have dozens of different ISA accounts with different providers. Talk to your IFA about amalgamating (re-registering) all your equity ISA’s to one “Platform”. You have the same funds but now all held in one account, it will make life so simple and economical both now and on one’s demise.

If you have pension funds and/or ISA accounts it may be time to talk to an IFA about how these changes affect you.  For further details call Georgina or Mike on 01277 630873.

Long term care - how will we pay?

We are an aging population.  In the UK there are over 10.8 million people aged 65 or over and nearly 1 in 5 people will live to see their 100th birthday.

This longevity presents problems for society, particularly how to finance elderly care.  This is a question that affects governments of all political persuasions as well as individuals.  In 2011/12 the average cost of a residential home with nursing care was 722 per week, giving a staggering bill of 300,000 over an 8-year period.

It is estimated that 125,000 older people are funding their own residential care and 325,000 are funding the provision of care within their homes.  The cost of that care is rapidly eroding savings or the value of housing equity. 

The Care Act 2014 caps the amount that an individual has to pay for their care but the ‘cap’ does does not include general living costs and still leaves a substantial bill should a person needs residential care for several years. 

The rules surrounding care fees are complex and often misunderstood.  For example, when may you be eligible for free care, when must you pay; how much of your own money can you keep; will the local authority help pay for your care?  It is estimated that more than 80% of people living in a residential or nursing home should not be paying for all of their care.  Many people who do pay for their care are not aware of other available state help; nor do they know that there are options that could mean they don’t need to sell their home to foot the bill.

Such complexity makes it vital to seek proper legal advice - preferably whilst the person needing care is well and living at home although failing that, immediately they need care, regardless of whether that care is at home or in a residential or nursing home. 

If you are interested in finding out more without any obligation there is a seminar on 11 June from 6.00pm-8.00pm at Stock Brook Manor. Birkett Long’s experts in legal issues affecting the elderly will enlighten you on the criteria surrounding care fee reclaims and who can apply.  Claims can even be made by executors of a will, where the person receiving care has since died.
If you need further details phone 01206 217334 or email