Managing your money: 5 financial tips that can help you through coronavirus
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How to manage your finances and raise the funds you need to see you through these extraordinary times.
Marcus Maisey from KDW Financial Planning explains some of the options that are available to help you pay your mortgage, support your business and offer you peace of mind.
1. Apply for equity release
Equity release, also known as a lifetime mortgage, is a way for over 55’s to release capital from their homes. You can either pay the interest or have the interest added to your mortgage.
“For those over the age of 55, who may have come out of furlough but face redundancy, this could be a way of raising money to enable you to pay your monthly bills and support your family,” Marcus suggested.
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2. Take out a loan or re-mortgage your house
“Bank of England interest rates are at an historic low. It may be worth taking advantage of this and consider applying for a short-term loan or re-mortgaging your home on to a better deal. It could give you a cash injection or help rebase your finances,” Marcus explained.
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Discuss what loans are available and the implications of re-mortgaging your home with a financial advisor to determine if it’s the right decision for you.
3. Invest your money
If you’re relying on cash savings to provide you with an income, the reduction in interest rates by all major High Street banks will come as an unwelcome move.
“Cash interest rates are as low as 0.03% for some balances up to £50,000 which equates to £15 per year interest. If you take a regular monthly withdrawal of more than £1.25 per month you’ll lose capital,” Marcus said.
“The interest on your savings won’t be enough to pay the income you need. You should consider investing over the longer term in assets that have the potential to produce the monthly return required.”
KDW Financial Planning will discuss your investments with you to devise an investment plan. They’ll help control your funds, review your current assets and advise where best to invest your money.
4. Accessing your pension
It may be sooner than you planned, but if you’re over the age of 55, you have access to your pension which could include a tax-free lump sum and/or an income.
You may have unclaimed pension money in several pots from past jobs and ones you didn’t even know you had.
KDW Financial Planning can help you combine these all into one pension. It may give you access to added funds when you need them most.
“Accessing your pension sooner rather than later may help ease the financial pressure in these strange times,” Marcus said.
You can call KDW Financial Planning to discuss your options. They can help you find solutions and assess the risks, allowing you to make an informed decision.
5. Declutter your finances
Add sorting through your finances to your lockdown to-do-list. It can help put your mind at ease in this stressful time.
“It’s important, especially now, for you to look after your financial health and have a clear plan. I’d recommend reviewing your monthly out-goings and discussing it with a professional to see if any immediate savings can be made,” Marcus said.
Plan your life insurance, check your policy is up to date and your cover is appropriate for your current circumstances. Also, it’s important to check that you have the correct nomination form on any pensions and that you have a valid Will.
Speak to a professional
“In these uncertain times, it can help to know there’s someone you can talk to. We’re here to offer whatever financial help you need,” Marcus said.
KDW Financial Planning has provided services to the St Albans Community and the surrounding area since 1978. Anybody can contact them for financial advice. They can help keep you going until life returns to a new normal and come out the other side in good financial health.
Past performance is not necessarily a guide to future performance. The value of investments and the income from them can fall as well as rise and you may not get back the amount originally invested. Your home may be repossessed if you do not keep up repayments on your mortgage.