Financial adviser for 85 year old widow with significant assets

Hi Sarenco

I am simply pointing out what most people ignore. That deposits are not safe.

She is almost certain to see the value of her savings depleted by inflation.

Investing in equities is less risky as they are likely, in the long term, to provide a return greater than inflation.

Her investment horizon is that of her beneficiaries.

Brendan
 
Clearly, there are merits and demerits of cash-like investments.

If we take inflation averaging at 4% to 5% over the next 4/5 years, what amazes me is the assertion that, in order to be compliant, (as apparently it is mandated by the Regulator) an investor/family of investor must lose c. 20% over the next 4ish years in real terms. (And there's me thinking if you go to a financial adviser, you're meant to gain 3% plus p.a versus doing a DIY jobbie......;))

Go figure. I know that the CB is useless but, even still, I find it implausible that they are mandating such nonsense.
 
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Reuben321 said:
My eighty five year old mother has recently inherited significant assets from my father. The assets are mainly comprised of property, shares, pension,a business debt and bank accounts.

One of the shareholdings has been compulsorily sold and she now has a very significant sum to invest in a low risk investment/ account. She needs advice on what to do with the money and a recommendation on a good completely independent financial adviser she could contact or that I could contact on her behalf (I have authority). She does not need to touch the lump sum at the moment as she has enough to live on with the pension and bank accounts but may possibly need access to some of the money if she required expensive nursing care at home or in a nursing home. She has a health policy of she needs care in a hospital. She doesn't want to lose any of the money so any investment would need to be secure and low risk. I would appreciate your advice.
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She would be more comfortable if she could access some of the money in case of necessity but the remaining balance is still a very significant sum. It is also likely that she would not need to access the monies as her children are happy to care for her or pay for any nursing costs when/ if necessary.
 
Reuben321 said:
her children are happy to care for her or pay for any nursing costs when/ if necessary.
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One thing worth bearing in mind is that whoever pays for the nursing home/nursing at home costs can set it off against tax at the higher rate.

So she could gift her kids money.

And if she runs out of money, and they pay her care costs, then it costs them 60% of the gross cost.

Brendan
 
jasdpace@gmail. said:
If we take inflation averaging at 4% to 5% over the next 4/5 years,
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If this is the case I will bet you that interest rates won't be much lower!

Brendan Burgess said:
Her investment horizon is that of her beneficiaries.
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In theory, yes. In practice, an 85 YO isn't usually knowledgeable or energetic enough to go assembling a directly-held, diversified share portfolio.

If I was a likely beneficiary it would be far simpler for many reasons to receive an inheritance in cash.
 
A crude “one size fits all” approach to dealing with older clients just doesn’t make sense.

It’s far better to “proceed with caution”, to think of any surplus cash as potentially intergenerational in nature, to consider including the next generation in the process, and to ensure that aspects such as an Enduring Power of Attorney are covered-off.
 
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