Is pensions freedom a good thing when considering potential later life care needs?

It is well documented that the new pensions freedom rules provide a great opportunity for the over 55s to access all their pension benefits to spend as they wish, however the new pensions freedom rules come hot on the heels of the Care Act 2014, which is misleading when it comes to State support in later life. Those planning retirement now need to mindful that the care fees cap of £72,000 is not what it seems and is in fact a massive understatement of the funds an individual could need to put aside for care costs. To add to the confusion, the Government have now announced their wish to delay the introduction of the Care Fees Cap by 4 years to 2020.

The questions are – how would the local authority treat your pensions benefits in any financial assessment for long-term care and will you access your pension benefits in the most prudent and tax-efficient way, not only for your capital and income needs in retirement but also for potential later life care funding?

Pensions and planning for later life are complex subjects and everyone’s situation is different, therefore if you would like further information or support please contact Kevin Hilton, a SOLLA accredited adviser on: 01904 464100 or enquiry@garbutt-elliot.co.uk.