More pensioners using equity release to free up income, says Saga

A new study from Saga Equity Release shows that more and more pensioners are struggling with debt when they retire. However, it also found that an increasing number of over 60s are using equity release to unlock the money in their homes so they can enjoy a better quality of life in retirement.

The research shows that 40% of people in this age group use equity release to clear borrowing, while 31% use it to remortgage their properties. Over half of over 60s (52%) use equity release to carry out home improvements and transform their homes, while 34% fund the holiday of a lifetime. A generous 20% give the money to family.

Andrew Goodsell, executive chairman, Saga Group, says: “This study dispels the concept that equity release is the last resort for those who have nowhere else to turn. We have found that people are increasingly likely to use equity release to clear debts, enabling them a better quality of life in retirement.”

The majority of people taking out equity release with Saga opt for a product with a drawdown facility, which enables them to withdraw money as and when they need it, so they do not incur interest charges until they are ready to spend the money.