Don’t leave your property wealth out of retirement planning

The LV= Wealth and Wellbeing Monitor surveys 4,000 UK consumers on a quarterly basis to gather insights about how the coronavirus outbreak and lockdowns are affecting attitudes towards saving, spending and wellbeing. As part of this year’s survey, it was revealed that nearly two thirds (59%) of non-retired adults didn’t feel confident that they’d saved enough for retirement.

If you fall into that category, it’s important not to leave property wealth out of your retirement planning. According to the Equity Release Council (ERC), private pensions and property in the UK are worth £11.21 trillion combined. Not only do they account for 77% of all household wealth, but they’re also the two biggest and fastest growing sources of wealth, and are consistently ranked the safest methods of saving for retirement.

Why some retirees avoid equity release

The ERC has found that homeowners in England and Wales could unlock £88,290 from their property on average using a typical equity release plan. This is roughly the equivalent of more than a decade of State Pension payments. However, despite there being an estimated £1 trillion pounds worth of unmortgaged housing equity held by the over-65s alone, many are still reticent about releasing equity from their homes.

There are various reasons as to why equity release isn’t included in many people’s retirement plans. Such as wanting to leave an inheritance to family – particularly their house – as well as concerns about the reputation of equity release and a fear of making a mistake. All of which are valid points of view and are precisely the reason financial advice is so crucial to finding out more about the risks and rewards of equity release.

Get the best pension advice for you

David Burrowes, Chairman of the Equity Release Council, said recently: “Decisions to release equity are not made in isolation of wider developments in the property market. The resilience of house prices means that, for many older homeowners, property continues to be the most significant asset at their disposal and a viable route to boosting their income from pensions and savings, or gifting a ‘living inheritance’ to family members for their own use such as for a house deposit.”

“In the right circumstances, equity release is a flexible financial planning tool that can increase retirees’ options in later life. Property wealth has performed well even amid the economic disruption, and with the successful vaccination programme feeding through into consumer confidence, many people may be revisiting their financial priorities.”

If that includes you, then Acumen’s expert financial advisers are here to help, providing impartial advice about the various equity release options available to you, as well as their inherent risks and benefits. We can break down how equity release schemes work and what types of equity release schemes are available to you. With our extensive equity release knowledge base, we can guide you through the various options to help you find the right solution for you.

For more information about equity release, or to speak to one of our advisers, please contact Acumen today by calling 0151 520 4353 or email us at info@acumenfinancial.co.uk.