Immediate Needs Annuity – Long Term Care Annuity
Annuities are guaranteed incomes which you buy using a fixed sum of your pension money on reaching retirement. There are so many different types of annuities to choose from and using an annuity adviser might be a good idea to help walk you through the sheer amount of information available. When it comes to taking care of someone else’s assets, however, it can be difficult to know what to do for the best, especially if the person is an elderly relative in need of long term care.
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One possible option is an immediate needs annuity which is a popular choice for those people who seek the reassurance that they can financially cope with paying for long term care.
According to research one in three people will require some kind of nursing home care in the later stages of their life, but with the uncertainty of not knowing how long the care may be required, some people simply pay out from their own pocket. Relatives who do this might be seriously damaging their own finances as the care could be required for longer than you expected.
Many people in nursing homes have expensive bills to cover; costs can sometimes rise to £500 per week. Investing into an immediate life annuity can give you and the person in the care home the peace of mind that however long the care is required; the financial situation will remain stable and comfortable.
The immediate life annuity is paid for with a lump sum; some people decide to sell equity in a property, or if the person is seriously ill, their house may be sold completely. The pension company will then guarantee to pay the person’s nursing home costs for as long as required, sometimes this means the rest of the person’s life. As the amount of money is paid to the provider of the care directly, they are free from tax which is also highly beneficial.
The type of immediate needs annuity that is received depends on the person’s individual circumstances such as age, location, health and so on.
Deciding on an immediate life care annuity means that you can receive peace of mind and reassurance which will not leave you financially impaired. This can be a worrying time for many families so this is one option which may alleviate some of the stresses that come with organizing a relative’s long term care.