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THE INVESTOR | 23
Moving into retirement living can have an
impact on the rest of your family, as well
as on you.
Downsizing from your previous home can
release capital – McCarthy & Stone says that
while the average price of its properties is
£239,000, the average value of its buyers’
previous properties is £299,000. You may
be tempted to pass some of this on to your
children in the form of tax-exempt gifts,
but Tony Müdd, Divisional Director,
Development & Technical Consultancy, at
St. James’s Place Wealth Management, says
this is the last thing you should be thinking of.
‘You need to be sure you have made
the right decision about where you are
living before you make any other financial
decisions,’ he says. ‘You also need to consider
what care services you may need in the future.’
Moving into retirement living
accommodation may reduce the amount you
can bequeath to your family. So it’s a good
idea to involve your beneficiaries in the
decision-making process to ensure they
understand why you are moving and are
happy that you will benefit from the additional
support provided.
Once you are sure you have sufficient
capital for your own needs, you may want to
consider Inheritance Tax planning, including
the use of a trust. Müdd says: ‘Not everyone
is happy to give capital away, and in these
circumstances a trust can allow the donor
to keep some control over how the money
is dispersed and used.’
Trusts are not regulated by the Financial
Conduct Authority.
a list on the noticeboard provides details
of car owners offering lifts to the local
supermarket, dates for coffee mornings
and the annual garden party, and listings
for theWherry Court Cinema Club.
LifeCare Residences, which has more
than 30 years’ experience of running
retirement communities in New Zealand,
recently opened its first luxury community
in the centre of London. Battersea Place
overlooks the eponymous park and is
within ten minutes’ walk of the King’s
Road. In addition to a very large living
room, the development offers a communal
library, gym, beauty therapy rooms,
swimming pool, restaurant and café bar.
Apartment owners can hire cars from
the development’s car pool – ranging
from small electric BMWs through to
a chauffeur-driven limousine – by the
hour or day.Moreover, although the
first residents only started moving in last
Spring, there are already clubs developing
such as bridge, IT and cinema.
Battersea Place has the ambience and
service levels of a smart, long-established
upmarket hotel: the concierge staff can
provide just about any service needed by
residents, such as booking a cleaner for
their apartment, arranging tickets to the
theatre, or walking their dog. Domiciliary
care is also available in apartments, along
with housekeeping services. Sir John
Goulden, formerAmbassador toTurkey
and Permanent Representative to the
NorthAtlantic Council, says this is what
the development’s residents expect. Sir
John and his wife, Lady Diana, were among
the first owners to move into Battersea
Place.Along with other residents they
Balance sheet Retirement living is becoming more
and more popular with retirees, but there are financial
implications that must be considered first.
have formed a residents’ association to
advise management on what they would
like to see introduced.The cost of buying
and running a retirement living apartment
varies widely from one development to
another. Prices are comparable to standard
local property values, so while the average
price of a McCarthy & Stone property is
£239,000, LifeCare Residences is charging
London prices for Battersea Place:
apartments start at £600,000 but go up to
£2.9 million for a penthouse.
While you may have sufficient capital
to buy a retirement living property, it
is important to work out whether you
can afford the ongoing service charges.
Service levels are high with commensurate
charges: the charge for a one-bedroom
apartment inWherry Court is currently
£917 for six months, and the charge is set
annually. In contrast, service charges for a
one-bedroom apartment at Battersea Place
are £990 a month, fixed for the duration of
your ownership.
You and your financial adviser should
also ensure that you are comfortable with
the terms and conditions of both the
purchase and many retirement
developments are new, you may have to
buy off-plan, and some developers stipulate
that they are paid a proportion of any uplift
in value when it comes to reselling.
Lastly, bear in mind that your
retirement living accommodation may
not be your last home. Battersea Place
offers theAlbert Suites for people who
need long-stay nursing, convalescent,
rehabilitation or end of life care, although
most developments are designed for
people with a specific level of physical
ability. If you should become unable to
look after yourself, you may need to move
to assisted-living accommodation, where
you still have your own apartment but
with access to a higher level of care, or
even a traditional care home.
The opportunity to
meet peoplewithin
a similar age range
attracts buyers
THINK BEFORE YOU JUMP
PENSIONS
IN YOUR INTEREST