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Pension income is one of the few things people can rely on in retirement. State pensions provide a relatively low amount of income and nowhere near the same amount of flexibility, making private schemes very valuable financial assets.

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Because of these factors, it can be incredibly painful to see pensions fall in value, especially when the cause is something out of the holder’s control.

Coronavirus has hit many people’s pension pots and while younger workers may be able to ride out the damage, those approaching retirement are unlikely to have similar options.

Thankfully, there is advice available for people stuck with these problems which can help them plan out their next steps.

Joel Kempson, a Personal Finance Expert at money.co.uk, provided insight on what options people have, even when factoring coronavirus: “COVID-19 has created turmoil in global financial markets, hitting many people’s pension pots.

“Combined with job losses, reduced incomes and low saving rates, it means now is an incredibly worrying time for anyone hoping to retire in the near future.

“Even though around 1.5m workers in the UK over 50 have said they will need to delay their retirement plans due to the pandemic, there are still some steps you can take to help get your retirement savings back on track.”

The first topic he covered focused on professional advice, a complicated and often costly option that some may be intimidated by.

Getting the right advice

“Take the time to think about what your financial goals are without letting panic about the present drive your decisions for the future.

“Any decision about your pension may have long-term consequences on your retirement income, so you should think about getting independent advice from a qualified financial advisor.”

Within the UK, there are thousands of companies and independent financial advisors offering this type of service, meaning it can be daunting to even know where to start.

Fortunately, Joel highlighted a number of sites and service providers that can help narrow down the options: “Sites like Unbiased.co.uk and VouchedFor can be good starting points to find affordable and independent advice.

“This is especially helpful when thinking about things like the tax implications of any decisions relating to your pension pot.

“You can also get information and free planning tools from The Pensions Advisory Service (TPAS). TPAS is a government-run body which gives information and guidance to members of the public on their company, personal and state pensions.”

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Pension options

The UK has very unique pension laws which provide people with large amounts of freedom in how they access their pots.

From the age of 55, British savers can dip into their pension assets but Joel warns that people should think twice before taking action: “If you’re aged over 55 and you’re planning on getting access to your pension soon, you may have to think about taking a lower income than you had originally planned.

“By leaving more in the pot now, it is possible that you’ll be able to benefit from future increases in the value of your investments.”

Some people may also be considering buying an annuity, which can provide income in retirement.

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These annuities can be impacted by interest rate movements and Joel touched on how Bank of England decisions can alter the costs involved: “You may be planning to buy an annuity. Annuities are financial products you can buy with your retirement pot which guarantee you a set income for the rest of your life.

“The cost of getting an annuity is influenced by a number of factors, including the Bank of England base rate. The Bank has recently reduced the rate in order to soften the economic impact of the coronavirus.

“This is likely to affect the cost of an annuity, and you may face additional charges as a result.

“Again, it’s worth getting independent financial advice from a trustworthy source before you buy an annuity.”

Job losses

Finally, Joel commented on the unfortunate reality facing many people in the UK at the moment.

Coronavirus has forced many people out of work who may then have no choice but to fall back on their savings and pensions to fund them.

This is understandable, but Joel implores people stuck in this problem to consider any other options they may have: “If you are aged 55 or over and you’ve been made redundant due to COVID-19, it could be tempting to start drawing on your pension as soon as possible.

“But think carefully before you do this. If you weren’t planning on withdrawing money from your pension at this point you should think about what other short-term options are available.

“The longer you can reasonably hold off taking your pension the more time there will be for your pension investments to potentially increase in value after any coronavirus-related fall.

“You may be entitled to financial support from the government through at least one of several benefit schemes, including Universal Credit, New Style Jobseeker’s Allowance and New Style Employment and Support Allowance.”

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Premium Bonds holders are in with a chance to win prizes of between £25 and £1million so long as they’re entered in a monthly draw. The prize fund in total for June was £104million and the total number of prizes for this month was more than 3.6 million.

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Each month, there are two jackpot winners who win the maximum prize of £1million.

The first millionaire winner for this month was a female from Nottingham.

Her winning bond number was 292ME808065 and she had a holding of £50,000 – the highest amount possible.

The specific bond that won it for her had a value of £25,000 and it was purchased in January 2017.

The second jackpot winner was a man from Stoke-On-Trent.

His winning number was 384CP325978 and he had a total holding of £27,500.

The winning bond was purchased very recently in February 2020 and its value was £14,000.

Of course, while there are only two winners of the £1million jackpots, there are many people who win other high value prizes.

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For June, there were six winners of £100,000 spread across the UK.

There are 14 winners of £50,000, with one of whom having purchased their winning bond number all the way back in 1989.

There are hundreds of winning numbers in total and all of them are now available to see on the NS&I website.

Premium Bond holders can also utilise the government-backed saving bank’s prize checker to see if they’ve won.

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The NS&I prize checker just requires the user to enter their holder’s number and it will detail if they’ve won or not.

This prize checker can be used on NS&I’s website but it is also available via app.

Jackpot winners would usually be visited by the “Agent Million” who would arrive at the millionaire winner’s doors to give them the good news.

However, due to coronavirus this will no longer occur and instead, Agent Million will contact jackpot winners through other means.

Premium Bond winners have a number of options available to them.

Their prizes can be paid directly into a bank account of their choosing, which is detailed as the quickest and safest option.

The prize money will be paid into the account by the seventh working day of the month.

Winners can also automatically have their winnings reinvested, purchasing more premium bonds for future draws.

NS&I details that they contact everyone who has won a prize but sometimes it’s not possible to reach the winners.

Thankfully, the prizes are held by NS&I until someone claims them and there is no time limit for these claims.

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Universal Credit pays an income which is dependent on the household’s circumstances. While the amounts paid will vary, claimants will get certain allowances as a minimum.

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Single claimants will receive a monthly standard allowance of £342.72 if they’re under 25.

Single claimants older than this will receive £409.89.

Couples will get £488.59 for both if they’re under 25, with older couples getting £594.04.

While some people may be able to tide themselves over during the initial delay, others may need to request an advance.

Claimants who need to cover their bills while they wait can apply for an advance.

This advance payment could be as high as the first official payment.

To apply for this advance the claimant will need to:

• Explain why they need it
• Verify their identity
• Provide bank details for the payment

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Worried claimants will likely be reassured very quickly as the Department for Work and Pensions (DWP) will usually confirm if the person will get an advance on the day they apply.

If the advance is awarded, the money will come through within three working days.

If the claimant needs the money sooner than this, they can ask the DWP to pay it on the same day if they have no other money to live on.

It should be noted that the advance will need to be paid back, lowering future payments in the process.

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Claimants will start paying back the advances from their very first official payment.

They will be able to choose how many months they pay the advance back over.

This will provide some control over the repayments but the total must be repaid within a year.

While an advance is a type of loan, no interest is added onto it.

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The Royal Family have been spending the lockdown in stunning houses around the country, giving their fans a glimpse of their homes as they post updates on social media. But with the weekly clap for carers and NHS staff every Thursday, royal followers have seen one part of their home more than most – the impressive front doors. The royal households provide stylish inspiration for anyone looking to update the exterior of their home. 

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While not everyone can live somewhere as grand as the Duke and Duchess of Cambridge’s Anmer Hall or Prince Charles’ and Camilla’s Birkhall, it’s easy to get the look of some of the most regal doorways. 

Many of the beautiful doorways that have been spotted during the Thursday night ritual feature bold, statement colours – which are simple to copy with a fresh coat of paint. 

A front door makeover is the perfect DIY project to do during lockdown, especially as hardware stores are starting to open again. 

Painting the doorway also requires it to remain open while it dries – which won’t be a problem as Britons continue to stay home to stop the spread of the coronavirus. 

Here’s how to get the look of three of the most beautiful royal doorways. 

Prince of Wales and the Duchess of Cornwall, Birkhall 

Prince Charles and Camilla, Duchess of Cornwall appeared on April 23 to join in the clap for key workers from their home in Aberdeenshire. 

The royal couple, who are known as the Duke and Duchess of Rothesay when in Scotland, have a serene green shade for the front door of their home on the Balmoral estate. 

The soothing yet striking hue looks like it could be Farrow & Ball’s Breakfast Room Green No 81, but royal fans can also get the look with Valspar’s Coastal Touch R258D shade, available at B&Q. 

The elegant green tone has a touch of blue for a soft and calming finish. 

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Duke and Duchess of Cambridge, Anmer Hall 

Kate Middleton and Prince William have been busy showing their faces on the nation’s screens in recent weeks, with virtual interviews and video links to talk about their charity work online. 

However, they also made a rare appearance on the BBC’s Big Night In event, clapping for carers live from their Norfolk home during the fundraiser. 

The whole family stood on the grand doorstep on April 23, with Prince George, Princess Charlotte and Prince Louis, who was celebrating his birthday. 

The country home has an old wooden doorway which beautifully contrasts the red brickwork and traditional wall lights. 

Though your DIY budget might not stretch to an antique oak door, the look is easy to replicate with the right paint, such as Crown’s Rosewood exterior paint shade from the Sadolin range. The paint comes with royal approval too – Crown Paints has held the Royal Warrant since 1949 as supplier to King George VI, a proud accolade that was then renewed by Queen Elizabeth II. 

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Mike and Zara Tindall, Gatcombe Park 

For a more modern finish, follow in the footsteps of Princess Anne’s daughter Zara Tindall and her husband Mike. 

The royal pair live in the Gatcombe Park estate in Gloucestershire and recently shared a snap from their doorstep on Instagram. 

Rugby player Mike posted the photo of he and his wife Zara in rainbow-print T-shirts which have been designed to raise money for the NHS. 

Zara’s front door has a modern countryside feel with a mint-green finish, which looks like it could be painted in Benjamin Moore’s Light Green or Pale Vista, with panelling detail for a stately home feel. 

Get the look on a budget with Valspar’s ‘Cabbage Juice R227F shade for a subtle yet stylish facade for your home. 

 

The front door is often the last place you’d think to paint for a DIY project, but it’s one of the quickest and most cost effective ways to make a real difference to your home’s first impressions. 

For flawless results, Sue Kim, Senior Colour Designer at Valspar recommended using sugar soap first to clean down the door, and then sanding the surface by going with the grain. 

Be sure to fill in any cracks and sand the filler gently before you delve into the paintwork. 

A primer and undercoat should go on first, and then once dry you can go in with your new royal-inspired colour, applying two coats for an even, professional finish. 

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Overdraft rules have faced massive overhauls over the last few years, not just from the CMA but also from the FCA and government. The 2017 “Retail Banking Market Investigation Order” made it a rule that customers with personal current accounts must receive a text alert warning them of potential fees before banks charge them for an unarranged overdraft.

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Getting this alert is designed to give people time to take action and avoid unexpected costs.

However, some of the largest banks in the UK failed to heed these rules, which led to over £47million in refunds being handed over to customers.

According to new information published by the government today, the following banks have been forced to refund millions to their customers:

• RBS – £2.2million
• Santander – £2million
• Metro Bank – £11million
• HSBC – £8million
• Nationwide – £7million

Andrea Coscelli, the Chief Executive of the CMA, commented on the figures: “Text alerts have been absolutely key in helping people to avoid unfair unarranged overdraft charges and, where banks have failed to comply, the CMA has worked to secure millions in refunds for customers.

“While these breaches are disappointing – and may have been preventable had the CMA been able to issue serious financial penalties – our action has put a total of more than £47 million back into people’s pockets.

“With responsibility for enforcing this now sitting with the FCA, the dedicated sector regulator, we’re confident that this will continue.”

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While millions being refunded to customers is undoubtedly a good thing, some may find the figures disappointing.

As the figure is so high, it highlights that unfair overdraft actions are still a problem in the industry, one that ultimately hurts the customer.

Salman Haqqi, a Personal Finance Expert at money.co.uk, reflected this in his reaction to the findings: “The figures from the Competition and Markets Authority (CMA) are a story of two tales. On one hand we welcome the CMA putting £47million back in people’s pockets.

“But on the other hand, the figures reveal the issue of unfair overdraft fees. And the fact that this figure only covers a two-year period is outrageous.

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“For far too long the most financially vulnerable have been penalised for being financially vulnerable. But, with the CMA highlighting these breaches, consumers should now start to be treated more fairly when dipping into their overdrafts.”

Some customers, especially at the moment with the problems that coronavirus is presenting, may have no choice but to utilise their overdrafts.

Many may underestimate the costs of doing so and Salman implores struggling consumers to really examine the T&Cs involved: “For those who find themselves frequently in their overdraft, we’d recommend they familiarise themselves with their bank’s fees, and then compare with the wider overdraft market.”

In some cases, it may even be worth looking for other financial products.

This may require more work from the customer, but it could pay real dividends as Salman explained: “Other products may be more suited to their needs – and cheaper too.

“Another step you can take is to look at 0 percent balance transfer credit cards.

“These can provide much needed breathing space, helping you avoid paying interest, and can help clear debt if managed well.

“For those who have seen their overdraft fees pause in line with the bank’s COVID-19 response, now is the time to check their accounts and ensure they won’t fall into a fee trap. Free overdrafts won’t be sticking around for long and consumers could face difficulties when fees are re-introduced.”

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The state pension can make up a significant part of regular income for those who are able to receive it. Those who have reached this age may also be able to claim an extra payment in order to help with day to day life.

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This is known as Attendance Allowance, a payment which helps with extra costs if a person has a disability severe enough that a person needs someone to help look after them.

The payment itself is paid at two different rates.

How much an eligible person gets will depend on the level of care that they need because of their disability.

The recipient does not need to have someone caring for them in order to claim.

The lower rate of Attendance Allowance is currently £59.70.

To get this rate, the government defines the level of help needed being: “Frequent help or constant supervision during the day, or supervision at night.”

Meanwhile, those who need “help or supervision throughout both day and night”, or who are terminally ill, can get the higher rate.

This higher rate is currently £89.15.

It may also be the case that Attendance Allowance recipients are able to get extra Pension Credit, Housing Benefit, or Council Tax Reduction.

Unlike some government payments, Attendance Allowance is not means-tested.

This means that what a person earns or what they have in savings will not affect what they are able to get.

If a person lives in a care home and their care is paid for by the local authority, then they usually cannot get Attendance Allowance.

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Those who pay for all their care home costs themselves can still claim Attendance Allowance.

Attendance Allowance eligibility

A person can get Attendance Allowance if they’ve reached state pension age and the following apply:

• They have a physical disability (including sensory disability, for example blindness), a mental disability (including learning difficulties), or both
• Their disability is severe enough for them to need help caring for themselves or someone to supervise them, for their own or someone else’s safety
• They have needed that help for at least six months (unless they’re terminally ill).

Additionally, an individual must also:

• Be in Great Britain when they claim – there are some exceptions, such as members and family members of the armed forces
• Have been in Great Britain for at least two of the last three years (this does not apply if they’re a refugee or have humanitarian protection status)
• Be habitually resident in the UK, Ireland, Isle of Man or the Channel Islands
• Not be subject to immigration control (unless you’re a sponsored immigrant).

There are some exceptions to the conditions if a person is living in a European Economic Area (EEA) country or Switzerland.

If a person is terminally ill and not expected to live for more than six months, there are ‘special rules’.

These mean that there’s no qualifying period for how long a person has had the illness.

And, if they’re eligible for the payment, they will automatically get the higher rate.

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Pension income can come from private arrangements as well as a state pension. While private pensions may be larger than a state pension, they are much more likely to be volatile which is a real problem at the moment.

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Private pensions are usually dependent on the performance of the assets they’re invested in, which can in turn be dramatically impacted by unforeseen problems.

Coronavirus has seen various investment markets drop in recent months and there are worries that economies across the globe will struggle to bounce back once this all ends.

Because of fears like these, some people may be looking at their pension pots apprehensively, worrying that if they don’t take action now further problems will emerge down the line.

A recently completed survey from Fidelity seems to show that a sizable chunk of the population approaching retirement are looking to make drastic changes.

Fidelity recently conducted an “Investor Survey” which, as they detailed, captured sentiment among the UK population since the start of the coronavirus pandemic.

The research they conducted was based on a sample of 1,000 people which was representative of the UK at large.

The results found that almost half (48 percent) of respondents saw a fall in value in their retirement savings.

More than half revealed that they were worried about the level of income their pots would provide them with in retirement, with 54 percent detailing that they would likely need to defer their retirement plans and continue working for longer than anticipated.

Maike Currie, a Director at Fidelity International, commented on the findings: “Our research clearly shows investors are worried about protecting their pension pot post-pandemic.

“While investors of all ages will likely have seen the value of their retirement savings fall earlier this year as stock markets plummeted, the uncertainties facing those closest to retirement are particularly acute.”

Fortunately, Maike went on to highlight that people approaching retirement are not completely devoid of options: “Deferring your retirement isn’t the only option though, and there are other steps you can take to shore up your retirement finances.

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“The key is to make sure you’re informed, and to understand how your position might have changed.”

She highlighted three “retirement rules of thumb” which can help people evaluate their retirement needs, how much they’ll actually need and how much they should currently be saving.

Maike detailed that: “Thinking carefully about these questions can help you to understand whether you need to change your plans to ensure you achieve your long-term goals.

“And if you’re at all unsure of what to do it’s worth speaking to a qualified financial adviser”

Fidelity’s three steps for protecting a post-pandemic pension pot are as follows:

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Don’t discount an annuity

According to the Money Advice Service, an annuity is a type of retirement income product that people buy with some or all of their pension pot.

It pays a regular retirement income either for life or for a set period.

Maike kicks off the list by highlighting that this could be a first port of call: “While underlying annuity interest rates are low, remember that if you have a medical condition, you may be able to get an enhanced rate as this will be based on your life expectancy – therefore, make sure you complete a medical questionnaire thoroughly.

“Investigate this option and see what rate you can obtain – most rates will be different from person to person.

This way you can make an informed decision as to whether a) you can afford to retire on the annuity income or b) if you think it is worthwhile deferring in the hope of securing a higher income – through your health deteriorating or benefiting from mortality gain (although of course none of these are guaranteed to happen).

Keep contributing

Finding the will or ability to contribute to a pension can be very difficult at the moment.

Because of coronavirus, millions have seen their income reduced or lost employment altogether.

The idea of putting money into a pension could feel like the wrong choice at the moment but Maike warns that now is the time to embrace contributions as much as possible: “Keeping up your pension contributions during difficult times might seem like a daunting task, but it’s important to try and continue with your pension contributions to make the most of tax relief and pound cost averaging.

“If you are going on ‘furlough’, unless told otherwise, both your own pension contributions and your employer’s will continue at the current rate but will be based on the amount you are paid while on furlough.

“Think carefully before you reduce or suspend your contributions, or opt out of your pension plan, as it will have an impact on the value of your pension savings when you come to retire.”

Keep an eye on your income

Income needs may force people to sell certain assets just to keep their head afloat.

While this may be unavoidable in certain circumstances, Maike detailed that some people may not need the income at all: “Company dividend cuts may be a concern as this will impact your income payments.

“Unless you have other income sources, such as rental income, guaranteed pensions or a ‘rainy day’ fund then you may be forced to sell units.

“This is why, if you are investing in drawdown for retirement, you need to ensure you have at least six to 12 months of savings in cash to help see you through the bad times.

“If you are receiving a regular income through drawdown, now would be a good time to reduce withdrawals to protect the fund as you are unlikely to need as much income – with everyone locked down, your discretionary spending will have reduced.”

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