A survey of more than 1,600 people aged 50-66 found one in 10 (9 per cent) pre-retirees said they would probably take out an equity release product, compared to one in 20 (5 per cent) people who were already retired.
Indeed, pre-retired people were also more positive about equity release products generally, with a third saying that they might be a sensible option when older, compared to less than a quarter of retired individuals. A similar proportion (32 per cent vs 26 per cent) said equity release could be a sensible use of assets.
Of those likely to take out an equity release product, additional income was the main reason for doing so (38 per cent). One in eight (12 per cent) said equity release would allow them to be independent, while 6 per cent said they would use the money to pay off their debts.
Willie Mowatt, director of post retirement products for Norwich Union said: “The research shows there is generational shift between pre-retired and retired people as more people in their 50s and early 60s are considering the product as a way of funding their retirement. It’s also reassuring to know that nine in ten people questioned were aware of equity release schemes.
“This is a positive step forward for the equity release market as it shows it is shaking off its tarnished reputation and taking its rightful place amongst the retirement planning portfolio. Fewer and fewer people can now rely solely on pensions to fund their later years, so it stands to reason that retirees are increasingly looking into other options.”
The research also revealed that seven in 10 people surveyed would consider moving home to raise money if they needed to, showing further evidence that people view their homes as potential source of income. One in three even said they would consider moving to a cheaper home abroad to raise money for their retirement.
Of those who didn’t want to move, nearly half (45 per cent) said this was because they were attached to their home. One in six (16 per cent) couldn’t face the hassle of moving and 13 per cent were put off by the cost.
Mowatt added: “While equity release may not be the answer for everyone, for some individuals it can be a simple, convenient path to a more comfortable retirement. It is therefore encouraging that there seems to be a growing acceptance of the product as a viable retirement solution.”
