Equity release allows over 65's to remain in their homes

SHIP (Safe Home Income Plans) - the body championing high standards of delivery from UK equity release providers - reveals that although the cost of care is soaring, there is a solution for older homeowners.

The cost of care in retirement can be very expensive, with the average annual cost of residential care in a home costing an average £32,000. This stands at five times more than the average annual cost of receiving care in the home, at £6,846.

The average pensioner has an income of £13,884, rendering both care choices expensive. 450,000 older people in need of care currently face some kind of shortfall in the formal support that they receive with 150,000 currently purchasing care at home privately. This gap has lead to the growing care at home market being worth £51.91 billion, a market that has to be funded the British pensioner's already overstretched finances.

Andrea Rozario, Director General of SHIP said: "As their likelihood of needing private care increases, pensioners must consider how they would fund any care needed. Recent Governmental figures have announced the total of £700 billion tied up in home ownership by those in retirement; schemes such as Equity Release can provide a regular income in return for equity in a property. By taking out a lifetime mortgage or by selling part of the property in exchange for a regular income or a lump sum using a home reversion plan, pensioners can ensure that any domiciliary care costs are covered without a negative impact on their retirement finances."