To think about Equity Release

[papayaorange]

My husband and I are mid 60's. We live in a large house we both love but are asset rich and cash poor. I suggested that we release a bit of money from the house which has a lot in it, so that we can buy a new car and have some good holidays. We only have our state pensions and a small company pension. My husband is dead against it as he says it is spending the children's inheritance. What would you do.

Downsize but to a nice house. But remember the car is a depreciating asset. No guarantee that you will live a long life. Someone in our family passed away at Christmas. He was 63. We are now grappling with inheritance tax so make sure everything is set down in writing. If there is a substantial amount of money in the property someone will have to pay the tax due. If your house is worth 1million the inheritors would have to pay 40% of £675k. £325k is the max allowed on the entire estate. There are ways around that but you need legal advice. If you haven't a will make one soon.

If your house is worth 1million the inheritors would have to pay 40% of £675k. £325k is the max allowed on the entire estate.

Not if you’re leaving the main residence to direct descendants! For gods sake please get your facts straight before spouting crap on the internet.

So she started off with £200k equity and ended up with £135k equity. Hardly a whopping deal and there’s absolutely no guarantee house prices would continue to rise in a similar way.

She didn't end up with anything as she was dead! It was just a bonus that we got the additional money. And the deal wasn't about money per se, it was about quality of life. Sometimes the money 'left over' doesn't have to be the main criteria.