What options do I have?

There a number of ways to raise a lump sum. Here we consider the pros and cons of the most popular options.

 

1) Savings

Pros

No charges of fees to use money, no interest to pay

Cons

Opportunity cost of interest gained on savings, loss to estate of lump value + foregone interest/investment growth. May trigger a tax charge or early payment fees

2) Pension

Pros

No charges of fees to use money, no interest to pay

Cons

Opportunity cost of interest gained on savings, loss to estate of lump value + foregone interest/investment growth. May trigger a tax charge or early payment fee

Borrowing against your home, is it the only option?

 

There’s no denying that using equity in your home is becoming increasingly popular. For many people over 55, equity release appears to be the main, if not the only, option when it comes to raising a lump sum.  

  • But is it right in all circumstances?  
  • What are the pros and cons?  
  • Would it be right for you?  

To provide some stimulus around these important questions, we’ve created our own guide, which examines different ways of creating a lump sum after 55. We compare: 

  • The total costs of using your savings
  • Withdrawing money from taxable pensions
  • Borrowing using your home as collateral (i.e. equity release)
  • Taking out an Over 55s Unsecured Loan

Download our guide to raising a lump sum

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Borrowing against your home, is it the only option?

 

This document is intended only as a general guide and is not intended as personalised financial advice. If unsure, seek independent financial advice. Please remember tax rules can change and the value of the tax benefits will depend on your circumstances. The value of investments can rise and fall, so you could receive less than you invest. Once funds are held in a pension they are not usually accessible before age 55 (rising to 57 from 2028).

 

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