Find out how to make the most of your finances if, like Lorraine, you're 50 or over
Fifty is an important turning point for finances, and as Lorraine's hitting the big 5-0, we asked our Money Saving Expert Martin Lewis for his brief financial thoughts on what Lorraine and others celebrating this golden birthday can look forward to.
The Good News
Traditionally fifty is a positive time for finances, though as we now do everything later, some won't have hit these points yet. It's often the decade when kids leave home to fend for themselves, the mortgage is close to being paid off, yet we're still working so hopefully there's less need to borrow, more disposable income and a chance to save.
Yet in this low interest rate environment, looking after savings needs to become an active piece of work. The days where you could stick money in the bank and rely on decent interest are long gone – you can make your savings work for you but it needs constant monitoring.
* Open an ISA. The first place you should put your savings cash is in a cash ISA, it's just a savings account where you don't pay tax on the interest. The great news is if you're over 50 you can put more in - up to £5,100 per tax year, and you get the boost on your fiftieth birthday – so go for it Lorraine.
* Move money between spouses. If you and your spouse pay tax at different rates – e.g. one is a higher rate taxpayer the other is basic rate – then providing you trust each other put the savings in the name of the one who pays less tax – so your interest will be taxed less too.
* Get an EHIC card. Hopefully you'll have a bit more time for travelling – if you do ensure you grab a free EHIC card. It gives you access to treatment in any state run hospital in the EU and Switzerland and you'll pay like a local – so if they get it free so do you.
The Bad News
Sadly, excluding the cash ISA increase and free wills below, few tangible financial products start to change at aged 50. Many age related savings accounts start at 60 or more so there's not that many new things to try.
The Ugly News
Some may view retirement with warmth, others with dread, the rest may be shouting that at 50 retirement is an age away, what on earth am I doing mentioning it?
Well in financial terms 15 years isn't that long. The older you get the more risk averse you should become, as if you lose money in your investments or pension there's less time for market fluctuations to allow you to bounce back and recover.
* Free Will. OK so you've just turned 50 and now I'm talking about wills – almost enough to make you gnash your teeth isn't it. While I know you're not one foot in the grave yet, everyone who has assets and someone they want to leave them to, should have a will.
The good news is, as you're fifty there are now a few more ways to get it done for free. As it's November, it's WillAid month and anyone can get a solicitor drafted will in return for a non-compulsory donation of £75. Yet at age 50 many charities will also get their solicitors to draft a will for you at no cost in the hope you will leave them a bequest – see useful links for more.
* Think about your pension. The sooner you think about your pension the better, if you're working you've still got time to save money for retirement – whether in a pension or other savings.
* Think about downsizing your house. One of the most common questions I get asked is "should I/my parents do an equity release on our home?" This is because many elderly people have all their wealth in the home but no income.
An equity release allows them to borrow cash using the equity in their home – the problem is they're usually hideously expensive and risk eating away all the home's value for a very small amount of money.
Instead a far better answer is to downsize your home by moving somewhere smaller and more manageable and taking the cash.
Many in their 70s say they're too old and settled to move so think about this opportunity while you're 50 and have plenty of time to plan the idea.
If you're going to need more cash think about downsizing before you feel it's too late – it's still very early now – but that idea may just save you a shed load of cash in 20 years.