Capital Protection

One risk which you always take with one of these schemes is that you will die very soon after taking it out. If you die within a year, a home income plan which has given you £60 a week or so at a cost of £900,000 seems a very bad deal.

So you can protect the amount of capital you lose if you die within three or four years of taking out the scheme.

This capital protection means that you get a lower annuity and reduces your income by £6 or £8 a week. Capital protection is not normally needed for couples, as the chances of your both dying within three or four years is very small.

However, if you do choose to have it, the cost will be low.

Remember that the income you get is fixed for life - £60 a week now will be worth far less in ten years' time. Even if inflation remains at 8% a year, the value of your income will have declined by a third in ten years.

If you want to move, you can simply transfer the home income plan as long as the value of the new property is enough to sustain the loan you have taken out. If you move to a property which is worth less, you can pay off some of the loan and reduce your outgoings.

The value of the annuity remains the same, so your net income goes up.


Find out more about - Home Reversion Schemes

or Choosing A Scheme

Home Reversion Schemes

/retirement/pensions/income/advice/home-reversion-schemes.php... see: Home Reversion Schemes