Many people move home several times during their lifetime. With each move comes a bigger house, perhaps one that is big enough to accommodate a growing brood of children. When retirement arrives there are many hard questions to ask when it comes to finances, as people decide how best to fund their retirement. While it is prudent to have good retirement plans in place long before your pension age arrives, many people in recent years have found their plans fall far short of the reality.
The one main asset many newly-retired people have on their side, however, is their property. By this point in their lives they may well be mortgage-free. They may also have seen the value of their property rise far beyond what they paid for it. As such many pensioners may be rich in assets and yet poor, relatively-speaking, in terms of the available cash they have to work with.
This is one of the reasons why equity release is becoming more and more popular. It enables those who are asset-rich to make the most of those assets without having to move home in order to do so. While moving home might be a good bet for some pensioners, others have put down roots in their area and have many happy memories in their homes. It is understandable they would not want to leave it anytime soon.
Considering all the options
Of course, what works well for one person or elderly couple may not be ideal for the next. This is why it is prudent to consider every option – including equity release – before making a firm decision on how to free up some extra cash. Budgeting for retirement has always been an important part of life, and this has not changed. However new rules that are due to come into force soon will mean all retirees have the power to make their own decisions with regard to what they should do with their pension pot.
Opinion differ on the assumption that an inheritance may be left to the children when parents pass on. However it is important for retired people considering equity release to discuss it with their families prior to making any firm decision. Inheritances are not necessarily as widespread today as perhaps they were in the past. With that said, few would want any surprises to come to light when the time comes. As such it is usually best to be open and honest about what you intend to do if you are considering looking at equity release.
In the end we are all different and while equity release might be good for some people it may not be the right fit for others. However with plenty of opportunities to seek advice from experts in the market, there is a good potential to have all the facts in front of you before you make a decision. Whatever you do, it looks as though the market for equity release will become ever more popular in the future.