The days of leaving your investments untouched and living off dividends are over

[hiriskpaul]

Property is the big problem. Selling up, giving the money away and then renting seems like the only answer, but I hate the thought of becoming a tenant again. Maybe equity release if it can be done at a rate that is not exorbitant. Risky though if interest rates shoot up.

OR ... put property into multiple names, Joint Tenants (hopefully 7+ years prior to passing). £1M home, £1M stock index, £1M physical gold, spend the imputed rent (ownership is like being both landlord and tenant), and and stock dividends, along with drawing a 1.33% SWR. Which is like gold paying a 4% dividend, alongside historic 4% stock dividends and 4% imputed rent benefits. Rebalancing or not broadly doesn't make much difference to mid/longer term rewards. Split four ways, parents + two kids, and upon one passing the IHT liability might be zero, with perhaps grandchildren being added to the property title as grandparents pass. A factor there however is that upon sale then there may be CGT liabilities unless the property is also the main home/residence.

Liability matched (imputed) rent is better than non liability matched. Doesn't matter if rents collapse or soar, you're covered. Diversification across land, stocks, commodity ... fiat and non-fiat currencies ... income diversified across imputed/dividends/SWR.

If you give away part of your property and still live in it then the whole lot is still considered part of your estate when you die. The way round it is to pay commercial rent to the non-resident owners.

[1nvest]

Property is the big problem. Selling up, giving the money away and then renting seems like the only answer, but I hate the thought of becoming a tenant again. Maybe equity release if it can be done at a rate that is not exorbitant. Risky though if interest rates shoot up.

OR ... put property into multiple names, Joint Tenants (hopefully 7+ years prior to passing). £1M home, £1M stock index, £1M physical gold, spend the imputed rent (ownership is like being both landlord and tenant), and and stock dividends, along with drawing a 1.33% SWR. Which is like gold paying a 4% dividend, alongside historic 4% stock dividends and 4% imputed rent benefits. Rebalancing or not broadly doesn't make much difference to mid/longer term rewards. Split four ways, parents + two kids, and upon one passing the IHT liability might be zero, with perhaps grandchildren being added to the property title as grandparents pass. A factor there however is that upon sale then there may be CGT liabilities unless the property is also the main home/residence.

Liability matched (imputed) rent is better than non liability matched. Doesn't matter if rents collapse or soar, you're covered. Diversification across land, stocks, commodity ... fiat and non-fiat currencies ... income diversified across imputed/dividends/SWR.

If you give away part of your property and still live in it then the whole lot is still considered part of your estate when you die. The way round it is to pay commercial rent to the non-resident owners.

Is that because a gift that you still benefit from isn't considered as having been gifted? If so then perhaps even paying commercial rent might not get-round-it?

https://www.peterbarry.co.uk/blog/inher ... -property/

If the surviving joint tenant is in occupation of the property in question at the date of death and both parties own a 50% share, the standard approach is to reduce the value of the deceased share by 15%. So, 50% of a property with a value of £800,000 would be reduced from £400,000 by 15% to £340,000 for Inheritance Tax purposes.

If the surviving joint tenant is not in occupation of the property and both parties own a 50% share, the standard approach is to reduce the value of the deceased share by 10%. So, 50% of a property with a value of £800,000 would be reduced from £400,000 by 10% to £360,000 for Inheritance Tax purposes.