Earlier this week, a neighbour had a builder’s skip delivered to the front of his house, a statement of refurbishing intent guaranteed to generate a flurry of questions. A day or so later, I spotted him hurling the panels of a dismantled wardrobe into the rapidly filling skip, thus presenting me with a perfect opportunity to wander across the road and ask what he was up to.
Sweat ran down his face as he explained that the skip was acting as an incentive to ‘finish a job I’ve been putting off and putting off for months since I retired.’ The task in question was to remove the wardrobe panels currently doubling up as an apparently ill-fitting, loft space surface and then properly board his attic with 18mm chipboard. Spending money hiring the skip for a few weeks was, he realised, the only way he could motivate himself to get the job done.
I complimented him for recognising that his plans for the loft could only be executed once he had arranged the skip hire. “If I hadn’t, I’d be doing the garden or something more enjoyable than constantly banging my head on the loft timbers,” he replied.
Ordinarily, our planning isn’t quite so connected or incentivised, although we can be a little tardy implementing our targets. Such delays are often caused by life’s insistence that other, completely unexpected matters, muscle their way to the top of our priority lists.
Fortunately, there are some aspects of life where planning for, or around them, is not only essential but enjoyable too.
Take holidays, for example. Where once most of us began the advance scheduling of a short break or longer vacation by collecting a handful of glossy brochures from a high street travel agent, nowadays most of us engage the services of a PC, laptop, tablet or mobile phone to examine proposed holiday destinations and availability in greater detail.
The subsequent holiday planning procedure in most homes is well established: draw up a shortlist, the lengthier the better, and discuss each location’s relative merits, accommodation, flight times, car hire and the like, invariably accompanied by a glass or two of red, prior to booking the trip.
We don’t need to plan every single area of life when a mental note to remember something will suffice. This is particularly true when we start noticing that we’re putting on a few pounds, or that those occasional aches and pains remind us that anno domini impacts upon us all.
Thankfully, this prompts most of us to recognise how beneficial exercise, of both body and mind, social intercourse, hobbies and diet actually are. Simultaneously, we start ditching, or at least cutting back, on those habits that are clearly no good for us.
A similar picture emerges when we consider the value of regular exercise. Walking, swimming, or running, assuming your knees are still co-operative; stretching and using weights are all good for the soul as well as for staying in trim.
Of course, this all sounds like a natural part of the ageing process, but the point of referring to an age-related development to which almost all of us can relate is to highlight the period before we began exercising in earnest or deliberately change our diet: what might be called the ‘planning period’. Admittedly, very few people want to sit down with an Excel spreadsheet and schedule their porridge and pumpkin seed intake, record their time to run 5k, or swim a mile in the swimming pool. Some do, but most of us simply want to amend their diet, or arrange to go walking with friends because they enjoy the subsequent benefits.
Yet planning shouldn’t be dismissed as completely unnecessary. I wrote recently about the government’s axing of pensioners’ winter fuel allowance, a move likely to affect around 10 million retired people. I noted too that “…the proposal to establish an £86,000 cap on the amount older people have to pay towards their care, either at home or in a care home, scheduled to be introduced in October,” has also been ditched.
Nor should we forget the looming possibility that retirees will have to pay National Insurance Contributions (NIC) on their income, while just the other day, Business & Trade secretary, Jonathan Reynolds, refused to rule out scrapping free travel passes for pensioners, a particularly mean-spirited move which, if implemented, would have a huge impact upon millions of retirees.
Suddenly, the nation’s older demographic, people who worked all of their lives to enjoy retirement, appear under sustained attack. As a consequence, existing retirees and those currently positioned within the ‘soon-to-be’ variety, need to take a closer look at their finances and plan how to supplement their income.
Mark Gregory, chief executive officer of Equity Release Supermarket, the UK’s largest independent equity release firm, has seen a ‘noticeable increase’ in the number of older homeowners making contact to discuss the benefits of equity release. “Most people have worked for years to acquire their home and eventually pay off their mortgage, a process which, as most of us can attest, is not always a cakewalk,” says Mr Gregory, who adds: “As money becomes tighter, an increasing proportion of homeowners are keen to learn how they can access the ‘hidden wealth’ tied up in their property. Most are delighted to discover that the process does not involve moving or downsizing and that they retain 100% ownership of their home.”
Given how fiercely retirees appear to have been targeted of late, it’s worth noting that the tax free cash which can be taken as a single lump sum, or series of drawdowns, which people aged 55 and above can withdraw from their home, is completely tax-free. Moreover, there are absolutely no restrictions on how the money can be spent.
Mr Gregory’s recent experience highlights the fact that great swathes of older homeowners are currently exploring how to make equity release part of their longer-term income planning process. For centuries, retirees and older individuals have done something similar, spending time considering how best to draw an income from their accumulated wealth.
Today, equity release offers another, well-regulated, option without the need to incentivise your action by hiring a skip. Instead, getting in touch with a fully qualified equity release adviser will get the ball rolling and give you an accurate idea of how much equity can be released from your home. Alternatively, the Equity Release Supermarket website has a plethora of calculation tools including the industry first – smartER which helps you research the whole market to find products specifically designed for you.
Readers may consider this a smart move before the government issues its next ‘money-saving’ diktat aimed at the nation’s older population. The remainder of 2024, including Octobers much awaited budget could be a defining time for those entering or already in retirement.
