🔔 Need a bit of help moving in retirement

Find out how a lifetime mortgage can give you vital support

Financial planning can be troublesome in later life, with the need to carefully balance your present wants with your future needs.

Factor into this the various assets you may have, including pensions, other savings, and assets, and the situation could become even more complex.

Some of you may be wondering how best to access your property wealth - likely your biggest asset - as a means of boosting your later life finances.

However, downsizing from your home into a smaller property doesn’t have to be your only option.

Downsizing can be tricky.

You have the pressure of selling and the competition of other buyers when it comes to finding your next home.

Tied into all this there are the other, harder to calculate factors; your attachment to your family home and the area for example.

Fortunately, there are other ways you can access your property wealth.

A lifetime mortgage, the UK’s most popular equity release product, allows you to unlock a considerable tax-free cash lump sum from your home, all whilst you retain full homeownership.

Lifetime mortgages provided by lenders approved by the Equity Release Council, the industry regulatory body, feature a number of additional safeguards for your peace of mind.

Not only do you and your partner retain full ownership for life, but you will never owe more than the value of your home thanks to the no negative equity guarantee.

This also ensures that you will not pass on any lifetime mortgage debt to your heirs.

What’s more, lifetime mortgages offer interest rates that are either fixed for life or capped variable, meaning that you will have access to accurate projections of the cost from the start.

With no required monthly payments to make on a lifetime mortgage, the tax-free cash you unlock could be the perfect pension supplement.

The funds you unlock from your home with a lifetime mortgage could help you avoid the need to downsize altogether.

However, if downsizing is still something you are considering in the future – as a smaller home can be essential in later life – then there are lifetime mortgage options designed with these needs in mind, with some offering ‘downsizing protection’.

All lifetime mortgages from ERC approved lenders are also portable, subject to the new property fulfilling the lender’s criteria, meaning that you can still move in the future as well.

This means that instead of downsizing, you could even consider upsizing in later life.

In the same transaction as buying the new home, you could release some of the equity in that property, with the proceeds going towards the purchase price. Additional space could provide you with the room you need to host friends and family.

As with any financial decision, there are factors to consider with a lifetime mortgage. Releasing equity from your property in this way may reduce the value of your estate in the future, and the tax-free cash boost you receive may affect your entitlement to means-tested state benefits.

It is important that you receive a personalised illustration from your adviser, and they will be able to help you find the lifetime mortgage that most meets your unique circumstances. All the advice given at this stage is entirely free, and there is no obligation to proceed.

Notes

Responsible Equity Release is a trading style of Responsible Life Limited. Responsible Life Limited is Authorised and Regulated by the Financial Conduct Authority and is entered on the Financial Services Register under reference 610205. Only if case completes will Responsible Life Limited charge an advice fee, currently not exceeding £1,490.

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