How will Covid-19 vaccine change your life - and your finances?
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Despite predictable carping and petulant displays of unnecessary pessimism from the usual suspects intent on blaming everything on either President Trump’s departure or Brexit, the fact is the Covid vaccine is here and, unlike anywhere else in Europe, it is being administered at a cracking pace.
At last, we have some good news; at last, there’s light at the end of a what has been a murderously long, pitch dark tunnel. Yet by this weekend, more than eight million people will have been vaccinated since early January as millions more line up to receive the ‘jab marked freedom’.
The UK expects to have most adults inoculated by late summer, although I’m not sure we can expect the immediate reappearance of busy high streets, packed restaurants, chock-full theatres and crowded pubs.
Instead, I suspect we’re more likely to witness a tentative, mask-wearing return to normality. However, if trying to book a holiday is an indication, we can anticipate a prolonged period of jam-packed planes, trains, automobiles and cruise ships. Furthermore, holiday demand will not be short-lived.
Most of us have, at some point during three separate lockdowns (it’s incredible just writing those words, never mind living through them), spent time reflecting upon our lives. Following lengthy periods re-evaluating their priorities, many people have decided to change their lives for what they believe is for the better. Let’s wish them well.
I have only anecdotal evidence assembled from a tiny sample of people with which to support the above theory, but if it’s accurate and applicable to a much larger number, I believe that the singular quest to accumulate money will play a less central role in our lives, especially of those in middle- and later middle age.
It might sound a bit daft, but I suspect that millions of folks have decided there are more important things in life than the pursuit of the filthy lucre and concluded that, with a half-decent pension and a fair wind, they actually have enough. (See blog reference, below)
However, we cannot ignore the role played by cash altogether, which explains why the popularity of equity release to those aged 55-plus, shows no sign of diminishing, not least because it effectively kills two birds with one stone.
First, it can generate a significant amount of tax-free cash in a ‘one-off’ transaction and second, it allows those people who decided during lockdown that they would prefer to wind down from work but couldn’t previously afford it, to do so with almost immediate effect.
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The start point for many folks contemplating equity release is to get an idea of how much capital they could access by using a simple equity release calculator. However, even if the resultant figure comes as a pleasant shock, it’s worth noting that equity release isn’t everyone’s cup of tea and taking professional advice before proceeding is essential.
The equity release process is not dissimilar to buying or selling a house in terms of the time it takes and legal involvement; allowing 2-3 months to complete the transaction is generally considered prudent. So let’s fast-forward a few months and assume that having taken advice, you’ve successfully released a proportion of the ‘hidden wealth’ tied up in your home and are now sitting on a pile of tax-free cash. What do you do next?
As suggested above and depending upon your financial circumstances, it could be worth setting part of this lump sum aside to supplement a pension or an incoming freelance salary, perhaps. Thereafter, “the world’s your lobster” as Rodney Trotter used to declare on Only Fools and Horses.
How you use the remaining money is determined only by your imagination. You may be able to buy a small holiday home; you may prefer to pack your bags and head off on a world cruise. You may wish to buy a piano and hire a tutor to help you learn how to play.
What you do with the money released from your home is entirely your affair, but before you part with a penny of it, recall the quiet times spent during lockdown when you mulled over various ambitions and consider whether you’ve given yourself the opportunity to fulfil them. Then ask yourself: what am I waiting for?
THE WEEK IN NUMBERS
- 75 - The Ministry of Justice is expected to announce next month that magistrates will be allowed to continue working until they reach the age of 75. It will be the first increase in their retirement age in more than 50 years.
- 202 million - According to book sales monitor Nielsen BookScan, 202 million print books were sold in the UK last year, the first time since 2012 the volume of physical books sold has exceeded 200 million. Nielsen estimate the value of books sold was £1.76 billion.
- Five minutes - Enjoy a mid-afternoon nap? It’s doing you more good than you think. Chinese scientists have found that even a five-minute nap in the afternoon significantly improves mental agility; the most beneficial nap is one that lasts no longer than 40 minutes.
How much is ‘enough’?
Read Peter Sharkey’s blog exclusively at www.moneymapp.com/blog