Greater comfort and living life to the full drives equity release
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 saga.co.uk/equityrelease.