Whether you are about to retire or you are already in retirement you may find yourself in a situation where you need to supplement your pension to maintain your standard of living.
Often people plan to rely on interest on savings to supplement their pension. However, with the continuing low interest rates this is making such income increasingly difficult to maintain.
Release Equity from your home
Providing an income
If you are a home owner and you have paid off your mortgage it may be possible to raise money against the value of your home to generate an income.
Releasing a cash sum
If you need to borrow money rather than topping up your income, equity release schemes allow you to receive a percentage of the value of your home as a tax-free lump sum.
No regular repayments
One of the benefits of equity release schemes is that you do not need to make any regular repayments following the arrangement to receive either regular income payments or a lump sum payment.
The importance of independent financial advice
Because equity release schemes are quite complex it is important that you understand the advantages, disadvantages and risks before going ahead. Equity release is not suitable for everybody, some of the disadvantages to consider are:
- the expense of the loan as with some solutions the interest on the money is rolled up into the loan; and
- the loss of value to your estate when you die.
As independent financial advisers, this is where we can help. We would look at your finances as a whole and advise you on the most appropriate solution for you. We will only recommend equity release solutions that are offered by companies who are SHIP (Safe Home Income Plans) members.