Generation HIPpy: Half of retirees will use home to fund retirement
Over 50 per cent of people plan to use their home to pay for their retirement, according to retirement specialist LV=.
According to the survey, only one in four people currently in their 50s are on track to retire on time. This means three quarters need to find a way to make up for this financial shortfall. One in seven will ‘take the hit’ and retire on time but with less money while a quarter will delay retirement. However this still leaves many in retirement no man’s land.
As a result 3.5million, affectively known as HIPies (Home Is Pension), now plan to turn to their biggest financial asset – their home – to fill the void.
There are several ways you can use your property to improve your finances in retirement. The first is downsizing. However for those reluctant to leave their family home, equity release could prove to be a more appealing option.
Equity release allows a homeowner to release some of the monetary value of their home whilst retaining the right to live there. The amount borrowed is then repaid when the property is sold, typically when the owner(s) has passed away or moved into long term residential care.
Content correct at time of publication