Budget could lead to equity release

Posted in Equity Release Video News

24th June 2010

SHIP has announced that the rise in VAT could lead more people to investigate equity release schemes in the future.

The organisation's Director General Andrea Rozario reckons that the tax increase will hit over-55s hard, as they generally have a fixed income, so their budgets will be stretched by higher prices for products.

She also advises that people who have been relying on a comfortable public sector pension may now receive a "nasty shock" and could need to look into a drawdown lifetime mortgage to make ends meet.

Meanwhile, independent policy advisor Ros Altman believes that pension provision in the budget is a mixed bag.

Whilst she welcomes the reduction of means-testing, she criticises the fact that it'll take over a decade for the basic pension to grow to an acceptable level, meaning that in the short-term, many may still want to look into an equity release scheme to provide them with extra funds.

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