The UK is slowly emerging from the latest raft of Covid-19 restrictions and so far at least, the various required steps in the Government’s “Roadmap out of Lockdown” have been successfully achieved. We might perhaps be forgiven therefore for becoming more confident that we are heading for relative “normality” from 21st June, the date that we have been told is the earliest at which we might expect all legal limits on social contact to be removed.
For many people therefore now is a time for taking stock after what has been a traumatic year for public health, for the economy and for their personal and businesses finances.
Whilst I am sure that most people will be eager to regain the freedoms that we have all lost to the pandemic, for what will be well over a year by the time June 21st comes around, it will also be a time of great anxiety for many.
Of course, the most immediate and visible tragedy of the pandemic is that so many families have lost loved ones and now face a future without them in their lives. For the bereaved, resuming “normal” life will never be close to what it was before Covid-19 struck. But for millions more the future will also never be quite the same as it was pre pandemic. Many people will have lost their jobs despite the comprehensive support package provided by the Government Furlough Scheme. For many more that are self-employed, they have had severe problems to contend with in simply keeping their businesses afloat financially.
As Chancellor Rishi Sunak warned us back in April 2020, “despite the exceptional support measures that had been put in place to prop up the UK economy, he “could not save every job nor protect every business”.
So if you are one of the millions across the UK who is facing an uncertain financial future despite the combined support of the Furlough Scheme, Self-Employed Income Support Scheme, Bounce Back Loans, indeed all of the direct or indirect benefits that have been put in place, what else is available to help you to plan for your own financial recovery from the Pandemic?
Fundamentally, what is often needed during times of financial hardship, is a timely injection of capital or regular income to “take the pressure off” and support you until you have found another job or your business recovers. There are a number of ways in which you could potentially access this kind of help although much depends on your personal circumstances.
For those aged 55 or over, two of the most accessible means of achieving this capital or income support can be through your pension plans or by releasing equity from your home or other property.
Pension Plans: Many people will have a pension plan, or pension plans, which are invested in a portfolio of stocks & shares and/or other funds on your behalf. The funds in these “Money Purchase” types of pensions are usually available from the moment the pension holder reaches the age of 55.
From that age then it is usually possible to withdraw capital from your plan, with up to 25% of its value currently tax free, or start taking a regular income. It is certainly worth having a review of all of your pension plans to see how they might be utilised in this way.
Equity Release: Once again, the age of 55 is a threshold for anyone who would like to release capital from their property using an Equity Release plan, be it their own home or an investment property. Subject to certain criteria you might be able to convert some of the equity in your property into either capital, or a regular income; in either case this would be tax free.
In both of the above instances, early access to capital and income can have a detrimental effect in the long term, not only on the availability of income later in your life, but also on the value of your estate that you could eventually leave to your loved ones on death. It is vital therefore that you take proper financial advice before entering into any arrangements of these types.
Business Interruption Insurance: For those in business, this form of insurance (usually provided within a more general business insurance policy) can be a life-saver where cover is provided in the policy wording for loss of income due to a pandemic.
There has been quite a lot of press comment in recent months on this topic, much of it centred around the reluctance of insurance companies to pay claims in respect of the first UK lockdown period that began in March 2020.
In January of this year the Supreme Court finally ruled that insurers must pay out on those claims, yet still a large number of businesses are waiting for their claims to be settled. Some claimants have been asked to start the whole process again whilst others are left in limbo for months, waiting on a response from their insurer. It has even been suggested by some that these delays are simply a further “stalling tactic”, designed to delay the inevitable in the hope that some businesses would fail and therefore claims would not have to be paid in those cases.
Whatever the reason, it is worth considering obtaining legal support to get your claim paid. Specialist lawyers, available on a “No win, No Fee” basis by introduction via the Ancojada Group, are able to assist you by calculating how much the claim against your insurer is worth and then negotiating a settlement with the insurer on your behalf. If the insurer is not prepared to make a reasonable settlement, they can go on to pursue your claim through one of various legal avenues open to them.
The above are just three areas in which Ancojada Group companies can assist you in your personal or business financial recovery from the Covid-19 Pandemic. In addition we have a wider range of recovery and insolvency support services that may well be able to assist you. Whatever your circumstances, do not hesitate to contact us and ask for details if you need some help and support in recovering financially from Covid-19.
Ancojada Limited is not authorised or regulated to provide financial advice.
All financial advice is provided by other regulated businesses.
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