Equity Release Could Help Homeowners Relying on State Pension

According to new research from Safe Home Income Plans (SHIP), 93% of Britons plan to rely on state benefits when they retire and 61% expect to use a state pension. For many this might not be a sufficient enough pot to enjoy a comfortable retirement; something that 49% of Britons expect. This is why equity release schemes could be used to ensure a more comfortable retirement.

In fact SHIP’s director general, Andrea Rozario believes that the estimated £359bllion in housing equity to be available to over-65’s by 2030 should aid a strong case for equity release.

“Living in a retirement funding daydream”

With so many Britons unclear about how they will fund retirement and just a small portion – 7% - confident enough to afford an independent retirement there is a growing concern that many homeowners will have to compromise their lifestyle.

An equity release scheme has the potential to unlock a tax-free lump sum to supplement income. The 49% who expect to maintain or enjoy a level of lifestyle they have now may benefit from an equity release scheme.

Andrea Rozario, director general of SHIP commented on the findings:

“It is clear that many people are living in a retirement funding daydream. They aren’t saving enough money, they aren’t consulting financial advisers and they aren’t talking about their options with their families - and yet they still expect to have a comfortable retirement, with the help of the state.

“In 2030 there will be 14,678,000 over 65’s - more than ever before - and no way of supporting all of those in need. British people and the Government need to look at what is often their greatest asset - their property. By 2030, the over 65’s will be able to access £359 billion worth of housing equity, and could be using this to ensure the comfort of their retirement, rather than relying on a pot of public resource that may not stretch to accommodate them. ”

Related posts:

1. SHIP Continue to Champion Equity Release as a Retirement Fund
2. State-Supported Equity Release Scheme Could Improve the UKs Care Funding System
3. More Clarity Between Equity Release and State Benefits Needed
4. Pension Changes Could Force Homeowners to Use Equity Release