Half of house proud over-60s using equity release do so to make property improvements
Flexibility of draw-down option enables people to live life to the full
Equity release is not just an option of last resort, shows research by Saga Personal Finance.* People are withdrawing money from their homes so they can enjoy a better quality of life in retirement.
The flexibility provided by equity release means money unlocked can be used for a variety of reasons. Saga customers have been taking the opportunity to clear outstanding borrowing and then use the rest of the money to live a comfortable and fulfilling life.
Generally people use equity release for two or more separate reasons, clearing existing debt is the most common, with 40% of people saying this is one of the ways they intend to spend the money, 20% give on average £27,000 to their family and over a third (34%) use some of the funds to buy holidays or pursue other leisure activities.
A third of people use a portion of the equity they release to pay off their mortgage, lowering their monthly outgoings and allowing them to enjoy their retirement with fewer financial constraints
The old saying, ‘an Englishman’s home is his castle’ clearly rings true among the over-60s across Britain, as over half (52%) of homeowners using equity release use some of the money to enhance their surroundings and make home improvements, spending on average £11,000 each.
Alex Edmans, Saga Personal Finance, commented: “It’s not all doom and gloom. Our findings dispel the often held myth that equity release is just a last resort for cash strapped pensioners, when in fact people use the capital in their home to enjoy life, not just to get by.”
Saga understands the needs of its customers and believes it is best placed to offer them advice about how to fund their retirement –the majority of people taking out equity release with Saga opt for a product with a draw down facility, which enables them to withdraw money as and when they need it, which means they do not incur interest charges until they are ready to spend the money.
Taking out an equity release plan is not a decision that should be made without taking professional advice. The Saga Equity Release Advice Service** will put prospective customers through to an equity release specialist, who will guide them through the process to ensure it is the right option for their circumstances.
Homeowners can access a free guide to Equity Release, ‘Affording the Life You Would Like in Retirement’, or use the online calculator to show the maximum amount they could potentially release from their property, by visiting http://www.saga.co.uk/equityrelease.
Or to be put in touch with a specialist Equity Release Adviser, please call 0800 015 6256.
Notes to Editors:
*Internal data from Just Retirement Solutions, provider of the Saga Equity Release Advice Service. On average people give two or three reasons for taking equity release.
Top five reasons for using equity release:
1. Home improvements (52%)
2. Clear Borrowing (40%)
3. Holiday / leisure (34%)
4. Re-mortgage (31%)
5. Gift to family (20%)
Benefits of the Saga Equity Release Advice Service
Only provide advice on those equity release solutions that include a ‘no negative equity’ guarantee.
Free initial consultation.
A choice of face to face or telephone based service.
Support you through every step of the process.
Consider your circumstances and aspirations.
Review your whole situation thoroughly, including any benefits or grants you may be eligible for.
Offer a wide variety of equity release products from leading providers.
The solution to releasing equity from the value of your home may involve a lifetime mortgage or a home reversion plan. If either is the case, to understand the features and risks you should ask for a personalised illustration.'
A cash lump sum and/or income from an equity release scheme may reduce the consumer’s state benefits.
An equity release scheme will reduce the value of the consumer’s estate.
**The Saga Equity Release Advice Service is provided by Just Retirement Solutions Limited. Saga Personal Finance Limited and Just Retirement Solutions Limited are authorised and regulated by the Financial Services Authority.
Saga Personal Finance Limited is registered in England and Wales (Company No.3023493) and is a wholly owned subsidiary of Saga Group Limited. Registered Office: Enbrook Park, Sandgate, Folkestone, Kent, CT20 3SE
The information contained in our press releases is intended solely for journalists and should not be used by consumers to make financial decisions
For more information please contact the Saga Press Office on 01303 771529.