My home is my pension…

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However, since then we have seen how the fortunes of those invested in property have completely changed.

For your home to be your pension you need to be able to get your hands on the money but realising the profit in a property might not always be easy. For most people this would mean downsizing but if you are moving within the same area this might not release much cash at all. Also, do bear in mind that changing houses is not cheap. You can lose a substantial chunk of your profit to stamp duty, estate agents fees and solicitor’s fees.

Another way of getting hold of the cash is through Equity Release but this can sometimes be an expensive option and limits the inheritance you leave behind.

On top of that, it is wrong to assume that property will always be a good investment. Property prices rose 136% in the years 1998-2008 but only 16% in the years 1988 till 1998. We saw a downturn in 2007 and we just don’t know where it will end.

One property is a single investment. This gives you no diversification and increases your risk substantially.

Our advice would be to consider your property as part of an overall investment strategy. Stocks and shares, Fixed Interest and Cash will allow you to diversify your investments. In addition, pensions and ISA’s will give you substantial tax benefits.