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The satisfying reward of a lifetime of hard work is knowing that you can leave something behind and ensure that your closest and dearest are financially secure.
Derek Jarman, 60, hopes to reap the fruits of his successful gardening business and early retirement soon. After his business is sold, further trips are planned and Mr Jarman hopes to visit family around the world in New Zealand and the United States.
He has a well-feathered nest egg to support him when he quits his job, a pension pot of over £1 million, very little debt and less than £10,000 left on his mortgage. No. Mr Jarman has also invested just over £20,000 in stocks and shares of BP, Vodafone, ITV and Lloyd’s among others, none of which are held by the ISA.
But one of his biggest concerns is afterlife. His two adult children are independent, but the green-fingered entrepreneur wants to make sure his grandchildren are fed.
he said:
“I had a few accidents recently, and it makes you realize you don’t live forever. I’ve worked hard so far, and now I want to have fun.”
German’s taxable estate is about to grow significantly. He is in the process of selling his farmland, which will give him an unexpected profit of around £1.6m when capital gains tax is paid. German wants to do what he can for his family.
Harry Bell, Director of Financial Planning, Charles Stanley
Mr. German should make sure that his desire to help his grandchildren is reflected in his pension deceased endorsement. Since the pension falls out of his estate and goes to named beneficiaries, it would be better to withdraw his other unprotected assets from the IHT to fund his retirement.
Until recently Mr Jarman would have been close to a lifetime allowance of £1.07m. This is the amount someone could have saved for a personal pension in the past without incurring taxes. However, this cap has been removed in recent budgets, so he may wish to consider further pension contributions within the £60,000 per annum limit. He was also able to carry forward unused benefits from the last three tax years.
