QUESTION TIME

Your questions answered by an expert panel from Coopers & Lybrand
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The Independent Online
I am in Serps (state earnings related pension scheme) and have read that the Government is slicing away at everyone's entitlement. I expect to retire in 1999. How can I find out how much I will get, does it include the old age pension, and will the latest reductions affect me now and/or after I retire?

In order to find out your current entitlement to all forms of state pension, including Serps, you should write to the Department of Social Security in Newcastle-upon-Tyne.

The basic old age pension is separate from any Serps benefit and is not calculated by reference to your earnings before you retire.

The latest amendments to the way Serps is calculated are likely to affect the benefits of most individuals who have yet to reach the state pension age.

I am thinking of taking out a Home Income Plan. I am told they are now safe. But what happens if I do and go into care? Do I keep my income and do they get my house?

Home Income Plans became somewhat discredited into the late 1980s because of exposure to interest rate rises and the use of unsuitable investments. In theory they generate cash by taking out a mortgage on the property and using the capital thus raised to purchase an annuity. They should not be ruled out but extreme care is required.

In general the income from such plans would be treated like that from any other investment when considering your entitlement to benefits in respect of care fees.

A lot of the smaller, less well known, building societies seem to give better mortgage deals. Is it more risky to take out mortgages with them and is that why the rates they give are better?

It is true that some of the smaller building societies are among those that offer more attractive rates of interest on mortgages or special deals.

The main risk of taking out a mortgage is that the society's rate might become uncompetitive.

When looking at special deals on mortgages it is very important to establish whether there are penalties for early redemption or transfer to another society.

If a society were to go out of business, it is likely that another institution would step in to take over its mortgage book.

My husband and I had a joint account with Halifax Building Society for many years with an average investment of pounds 20,000. My husband died last month and I have been told by the local branch that since he was the first named holder and died before the date of the merger with the Leeds I would not be entitled to the share issue due to investors on the merger.

This does not seem fair as we contributed jointly to the account.

The Halifax says that where there is a joint share account, the person who is named first in their records of the account has, by law, the right to vote on whether the combined company should become a limited company. Any benefits which may be available on conversion to a PLC would also, by law, go to the person who is named first in our records. The law concerned is the Building Societies Act (Joint Account Holders).

The Halifax does say, however, that it is trying to get the best deal possible for special cases, within the constraints of legislation, and is searching for ways of benefiting such cases through the conversion. It has no new answers yet, but will contact these people when it does.

For queries to do with the merger, call 0800 888844.

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