DEAR TRICIA
Need some practical financial advice? YOUR MONEY Editor Tricia Phillips and her team can help
Q I’m in my sixties with an interest-only mortgage. I can’t afford to repay the full amount and read that my mortgage lender, Santander, were considering offering Lifetime mortgages. Do you know if they’ve started running these yet? A Santander confirmed a deal with a home finance company last year that will offer their borrowers the option to switch their interest-only deal to a lifetime mortgage, and yes it is still available. Please remember it is a form of equity release and subject to lending criteria. Q I have a decent sum of money to hand and I am considering robo investing. With the FTSE at an all-time high is now the right time to be putting my money into one of these firms? A Robo-advisors or investing is a cyber financial adviser that provides investment portfolio management online with no, or minimal, human intervention.
The investment risk and portfolio selection is based on the outcome of a series of questions answered. There is no advice fee as no advice is given, and ongoing charges are usually a little cheaper.
Only you can decide whether to use one of these companies when investing – that’s the idea. Q I want to use this year’s ISA allowance before April but feel as if my bank is rushing me into an investment that may not be suitable. What should I do? A Firstly, never rush into anything. Secondly, the adviser at the bank is liable for the advice given and should only recommend suitable products and funds.
For now, you could place your allowance in an instant-access cash ISA, so as not to lose it for the current tax year. This will then give you longer to consider your options and potentially transfer into a stocks and shares ISA later. There should be no charges for the cash ISA.
Q We retired to Spain and now we are moving back to the UK as we miss home. At last, we have sold our villa and the euros will be transferred from our bank here to our bank in the UK.
Although the current exchange rate is favourable, there are so many other charges. We read your column regularly and wonder if there is anything else we can do? A I agree, banks will often charge an exchange fee, a transfer fee and possibly a receiving fee, and on large funds these can mount up. You do have alternative options and there are a number of companies that will transact for you. Moneycorp is a reputable firm that I believe offer no transfer or
exchange fees and you can negotiate the rate. They may be able to help. Q
I’m selling a rental property for the first time and I think I will make a capital gain. How is this calculated? A The gain is the amount over and above what you paid for the property and some costs. You then deduct your annual allowance which is currently £11,100. The remaining gain is then added to your income for the tax year in which you made the gain.
The tax payable is 10% for a basic rate taxpayer and 20% for a higher rate. If not jointly owned, you could consider transfer and jointly owning with a spouse and utilising two annual allowances, reducing your potential liability.