Its report, The home belongs in the plan – Why later life lending is essential for client centred advice, gives advisers guidance on the trade-offs of obtaining later life finance, making them clear and documented. This includes modelling of outcomes such as inheritance implications.
The report was produced in partnership with Technical Connection and Ad Lucem and focuses on Consumer Duty, outlining how advisers can remain compliant when they demonstrate that a client’s relevant assets and options have been considered, and that they have not defaulted to a single option.
It also shows how later life lending can help clients.
The report also states that good financial planning focuses on sequencing assets and deciding which to use and why. It says good advice is not delivered with a spreadsheet, as well as the main motivations for later life lending decisions.
Air said clients and their close family must fully understand the implications of releasing equity, including the interest rate and how repayments are made.
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It said modelling options such as pensions, investments, downsizing and housing equity would give advisers a consistent and auditable approach for both themselves and their clients.
Tony Wickenden, founder and managing director of Technical Connection, said: “Later life lending isn’t for everyone – but for the right clients, it can support outcomes like earlier family help, improved liquidity, or greater retirement resilience, when the trade-offs are understood and recorded.
“While the desire to achieve a specific outcome, such as helping with a property purchase, can be very strong, it is essential that all parties fully understand the longer-term financial implications.”
He added: “Later life lending can be a valuable planning tool when used deliberately with clear guard rails, enabling advisers to deliver Consumer Duty-safe decision-making processes that families can understand and live with.”
Will Hale, CEO of Air, said: “Clients need advice that brings every part of their balance sheet into view, including the asset that represents a significant percentage of overall wealth for many, which is their home.
“At Air, our goal is to equip advisers with the insight and tools they need to establish productive referral relationships where appropriate and to deliver confident, client-centred advice in a fast-moving environment.”
