Equity release offering retirees ‘peace of mind’
With budgets stretched the UK is heading towards a retirement funding crisis, fears the Equity Release Council (ERC).
According to a recent study by the ERC nearly two thirds of people (65%) are ‘unable, unaware or unwilling’ to save for their retirement. This inability or reluctance to save for our future has left one in ten believing they will need to sell their home, commonly known as downsizing, in order to afford retirement.
While the future may look bleak, some may say the crisis is already upon us; one in seven people who are due to retire this year will do so without any private pension funding, placing many below the poverty line.
If a retiree earns less than £8,254, they are classed as ‘below the poverty line’. According to research by Prudential 21% of women and 14% of men foresee this as their financial future.
“In a perfect world we would all enter retirement with a healthy pension pot and high yielding annuity but, with the rising cost of living leaving many stretched financially, our savings are bearing the brunt.
“While this is far from ideal, it is by no means hopeless and it is reassuring to see a growing understanding of equity release and how it can offer many a viable financial solution in retirement.”
Content correct at time of publication