Equity release to fund your retirement

Like millions of over 60s, 70s and 80s you may wonder how you can manage financially in retirement. One possible solution for property owners who don't wish to move from their home is to use an equity release plan to unlock some of the capital from their property.

However it's worth noting that if you choose to go down this path you will certainly lose out on the market value of your home and won't be able to leave as much as you would like to your children. So do your homework well and be sure to seek independent financial advice concerning equity release to fund retirement.

Equity release broadly falls into two main categories; home reversions and lifetime mortgages.A home reversion plan is calculated on age and life expectancy so you do get a better deal the older you are. For a lump sum you will need to sign over at least a part if not all the market value of your property.

However, a lifetime mortgage may be a better option for you. The interest you pay on a lump sum secured against your property is added to the capital sum, to be repaid when you eventually die or move into a care home or when the property is sold. Whatever happens you are entitled to remain in your home for life.

To sum up, equity release may be the answer for you if you don't wish to move and need to supplement your income after retirement.

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