Homing in on what’s right for you

Homing in on what's right for you


To repay the mortgage or not to repay: that is the question facing many of our clients at retirement.

At Reeves our philosophy is that investment has to be an active process and action has to be taken as necessary when circumstances and markets change.

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We have described elsewhere how this informs our approach to asset allocation in our portfolio, but it should also apply to everyone. Stay flexible, keep your financial arrangements under constant review and be prepared to changed them when circumstances change. 

This is particularly the case when it comes to handling mortgages in retirement. 

Commonly our clients enter retirement and still have mortgages and they regularly come to us to discuss their options. 

Dave Smith retired with a mortgage of £120,000. He had a healthy pension fund as well as other savings and investments. He and his wife Shirley were both only children and were confident of being the beneficiaries of significant inheritances. 

Dave was aware that they had significant capital tied up in their property, and that at some point the equity in the house could be used to support their retirement.

We discussed the following options: 

Option 1. Pensions/Savings/Investments 

Option 2. Downsizing

Option 3. Inheritance

Option 4. Equity release

Conclusion

Dave's position is typical of many of our clients when they enter retirement. Keeping your options open and maintaining flexibility is key to a good plan. What seems like a good idea today might not be in three year's time and what isn't a good idea today might be in three year's time. Your health changes, your mind-set changes, your children's situation changes, all of which can reasonably affect your decisions.

Once you've made your investment arrangments, don't sit back and forget about them. Keep them under constant review and keep talking to us. 

At Reeves, we're very keen on hearing from our clients when making these decisions. Please get in touch as this is a key service. 

Each decision comes with its own risks and opportunities that need to be considered when making any recommendation. 


It is important that no actions should be taken without first taking advice. Personal circumstances and an individual's appetite for risk means that the advice for one person may not be the same for everyone. The information in this blog or any response to comments should not be regarded as financial advice. Reeves do not advise on Defined Benefit pension schemes. Reeves do introduce a third party specialists in areas of work we do not cover. Please note: This article has been published with the use of a fictional character to outline a case study. 

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About the Author

By Nigel Reeves: My mission is to provide the quality, honest & jargon-free pension advice that people need to secure the retirement they deserve. At home, I'm a family man and an active supporter of grassroots sports!

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