Contents

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Contents

• Property options
• Buy-to-let
• Downsizing
• Equity release
• Inheriting
• Selection criteria
• An alternative
• Summary

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Contents

• Property options
• Buy-to-let
• Downsizing
• Equity release
• Inheriting
• Selection criteria
• An alternative
• Summary

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Buy-to-let. The top five
Find the rightproperty
Research the market
Understand the risks
Being a landlord
Get the financials right
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Buy-to-let. The top five
Find the rightproperty
Research the market
False hope
Understand the risks
How will you fund the deposit?
Risks of a geared investment?
Falling yields?
Being a landlord
Get the financials right
Bad tenants or no tenants?
Any profit will be taxable
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Contents

• Property options
• Buy-to-let
• Downsizing
• Equity release
• Inheriting
• Selection criteria
• An alternative
• Summary

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Downsizing. Average house prices (March 2007)

• Detached property in the UK 326,396
• Bungalow 215,839
• Semi-detached house 197,992Flats and
  maisonettes 194,444
• Terrace 186,316

Selling a detached property and buying a
terraced property realises
140,000 (ignoring costs)
http//www.easier.com/view/House_Prices/article-10
3969.html
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Downsizing. What income can be provided?

• Difference in value 140,000
• Less expenses 10,000
• Amount to invest 130,000

M65 F62, 50 spouse, esc 3, no guarantee
An extra 537 per month (124 per week)
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Downsizing - other considerations

• Will you remain in the same area?
• Will your children be on the property ladder?
• How will the timing impact on your finances?
• What if you need long term (nursing) care?
• Are you prepared to continue to work?

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Contents

• Property options
• Buy-to-let
• Downsizing
• Equity release
• Inheriting
• Selection criteria
• An alternative
• Summary

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Equity release. Option 1 - Mortgage
You borrow You pay interest - or nothing
rolled up The lump sum repaid when home is sold
- along with any rolled up interest Any
increase in value belongs to you - or your
beneficiaries Possible to have 'no negative
equity' guarantee

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Equity release. Option 2 - Sell
You sell your home (or a ) to the reversion
company You receive a lump sum or
an income (or both) You live in the property for
the rest of your life When you die the reversion
company own your home (or their ) whatever it is
worth

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Equity release. Is this the answer for you?

• What are you left with?
• Will you get a lump sum or a regular income?
• What if you need/want to sell in the future?
• What if you need long term (nursing) care?
• People are living longer
• Using the equity will affect the amount you are
  able to
• leave as an inheritance

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Contents

• Property options
• Buy-to-let
• Downsizing
• Equity release
• Inheriting
• Selection criteria
• An alternative
• Summary

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Inheriting. Are you one of the increasing number
who is reliant on an inheritance?

• How long will your parents live?

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Inheriting. Life expectancy is increasing
Male Age 65
Female Age 65
Couple (Both Age 65)
There is a chance that you won't inherit the
money for your pension until you are in your late
70's
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Inheriting. Are you one of the increasing number
who is reliant on an inheritance?

• How long will your parents live?

You could end up supporting your parents What if
your expected inheritance is eroded by the cost
of long term care?
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Contents

• Property options
• Buy-to-let
• Downsizing
• Equity release
• Inheriting
• Selection criteria
• An alternative
• Summary

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The selection criteria
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A Spanish holiday home
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Contents

• Property options
• Buy-to-let
• Downsizing
• Equity release
• Inheriting
• Selection criteria
• An alternative
• Summary

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The benefits of investing in a pension

• Tax relief
• Tax efficient growth
• Flexibility benefits can be taken in stages
• Tax-free cash from 50/55
• No requirement to purchase an annuity
• Death before age 75 - IHT free death benefits
• Can invest in a property fund
• Something designed for the purpose

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A pension
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A pension
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Contents

• Property options
• Buy-to-let
• Downsizing
• Equity release
• Inheriting
• Selection criteria
• An alternative
• Summary

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Summary

• Property
• May have worked in the past
• May work for some
• Not without risk
• Does not obtain the same tax breaks as a pension
  does
• Not outside your estate for IHT purposes

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The benefits of investing in a pension

• Tax relief
• Tax efficient growth
• Flexibility benefits can be taken in stages
• Tax-free cash from 50/55
• No requirement to purchase an annuity
• Death before age 75 - IHT free death benefits
• Can invest in a property fund
• Something designed for the purpose

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Is your retirement income on target?
Alternatives Property? Potential
inheritance Other investments
Potential to improve returns Pension
fund Core/satellite approach
Additional
How much is needed in retirement? Look at
the risk profile? Revisit objectives?
Core needs must be funded for Pension fund
Target return objectives
How much do you need? How much do you
want? How much risk are you willing to take?
Want
Need
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Accrued value - pension compared with buy-to-let
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Retained value on death pension compared with
buy-to-let
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Supporting material

• List of what else is available and where to find
  it-
• Sales aids
• Webcasts
• Technical bulletins
• Comparison tool

Picture of EC HUB Here
www.clericalmedical.co.uk
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Important Notes

• This item is aimed at financial advisers and
  their clients. If you reproduce any part of this
  information for use with private clients, you
  must ensure it conforms to the Financial
  Promotion rules. In addition if used to advise
  private clients you are subject to the advising
  and selling rules.
• The information is based on our understanding of
  current legislation and Revenue practice, which
  is subject to change.
• The value of an investment may move up and down
  and cannot be guaranteed.
• Full details are available from Clerical Medical.

Part of the HBOS Group. Issued by Clerical
Medical Investment Group Limited. Registered
Office 33 Old Broad Street, London EC2N 1HZ.
Registered in England and Wales. Registered
number 3196171. Authorised and regulated by the
Financial Services Authority. www.clericalmedica
l.co.uk
January 2008