Equity Release Plan – Could it future-proof your finances? Laura Richardson’s latest article looks to answer this question for you as just one part of your estate planning . . .

Residents in many villages and towns across Essex are expressing concerns regarding the resilience of their financial plans in the wake of Brexit.  Unfortunately, none of us can accurately predict the effect of Brexit on our individual financial circumstances, and therefore it may be wise to consider options for putting away a financial safety net that could be accessed if the need arose in the future.

According to a survey by a leading financial product provider this year, there has been an increase in people using an Equity Release Plan in order to build up their ‘emergency finance fund’ by accessing money tied up in their property.

Advantages of an Equity Release Plan:

  • An Equity Release Plan works similarly to a loan or mortgage. However, you could choose to not make any repayments on the lifetime mortgage if you so wish, in which case all repayment is taken out of your Estate when you die.
  • However, you can choose to repay on an interest-only basis in order to access a lump sum of equity whilst potentially lessening the impact on the value of your Estate when you die.
  • You can release cash and invest this or lock it away in savings in order to have a lump sum available at a later date should you find yourself in financial difficulty.
  • You can remain in your home and release equity rather than try to move house in an uncertain market, and furthermore, you will not have to pay expensive moving costs.
  • Many Plans offer a ‘no negative equity guarantee’ meaning that should your property lose value and become worthless that the outstanding balance on your Equity Release Plan, your Estate will not have to make up the shortfall.

It is important to be aware that taking out an Equity Release Plan is a long-term financial commitment and may affect your entitlement to state benefits; therefore it is highly advisable to consult with a suitably qualified provider before making your decision. Andrew Douglas Wills and Legal Service are proud to work with a trusted partner in order to be able to provide an Equity Release Plan that is suited to your individual needs and requirements. Whether in Kelvedon or the surrounding Essex areas, if you would like to discuss whether an Equity Release Plan would be the right financial decision for you and your family, call Andrew Douglas Wills and Legal Services today to arrange your free initial consultation.

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