As you approach retirement, it is important to have a sound financial plan to ensure you have sufficient means to provide you with the financial capability to maintain your current lifestyle as well as future aspirations.
That said, if you do not have sufficient ongoing income, savings or pension provisions in place, having a comfortable lifestyle in retirement may not always be possible.
Whilst many of us may have significant wealth, your assets may not be easily accessed or liquidated. Individuals like this with little income are known to be asset rich, cash poor.
As such, the demand for equity release products has risen consistently for many years and emphasises the demand for additional income and / or capital later in life.
Equity Release allows home-owners over 55 to access wealth held within their property by turning it into a cash lump sum or regular income. You have a choice whether to make monthly repayments and you continue to own and live in your home until you die or move into permanent care. It is normally at this point that your plan would be repaid from the sale proceeds of your property.
Any money withdrawn is tax-free and yours to spend as you wish.
Typical reasons to release equity are:
- Home / garden improvements
- Debt repayment
- Clear outstanding mortgage
- Treat or help family and friends
- Assist children to get onto property ladder
- Assist with monthly income
It is worth noting that equity release will likely reduce the value of your estate, however here are features available with the range of products that help to minimise this.
Equity Release is a specialised product and therefore, it is highly recommended that Independent advice is obtained before proceeding.
Equity Release plans may involve a Lifetime Mortgage (with or without interest payments), Home Reversion plans and Retirement Interest Only mortgages which are secured against your home and could reduce the amount of equity within your property.
For further information please contact us to obtain face to face advice.