Over half (54%) of over-50s who are still in work would advise their children to invest in property for their retirement too, just greater than the number that would recommend their children pay into a pension (53%).
44% of over-50s in work still have a mortgage to pay: a fifth believe that a rise in interest rates would reduce their ability to save for retirement as they would have to keep up with mortgage repayments.
Homeowners nearing retirement say that on average over £21,000 has been wiped off their property value (totalling £60 billion) since the start of the recession.
However, this has not put many off using the equity in their homes to help fund their retirement, with nearly a quarter (23%, equivalent to 1.2 million people) of working over-50s considering using some, or all of the equity in their home to fund their retirement.
A further 9% will also be taking advice on using their property equity before they retire.
Vanessa Owen, LV= head of equity release, said: “It seems to be increasingly commonplace for those approaching retirement to consider using the equity in their property as part of their overall retirement plan.
“Continuing doom and gloom over volatility in the housing market and seeing some properties fall in value, hasn’t deterred the UK’s “HIPpies” [Home is pension] and many are still positive that the equity they have built up over the years in their home is their best chance of having a more comfortable retirement.”
Vanessa Owen concluded: “While we may have seen the worst of the recession, we can’t fail to ignore the impact the last few years has had on the personal wealth and pension pots of the over-50s. For many, their home is still a big part of their wealth and trading down to a smaller home or using a suitable equity release product may be the only option for them.
“Anyone considering using their property to fund retirement should seek specialist advice, and should also talk to their family about it.”
