Most people nearing the retirement phase of life worry about two big financial questions:

  1. Will I have enough money to enjoy the retirement I deserve?

  2. Will my retirement income allow me to live happily for the rest of my life?

When the answer to these questions is unclear many people look towards their home as a way to enjoy the lifestyle they have been dreaming of, without unnecessary stress and worry.

Often at this stage of life; with any children moved out, with little or no outstanding mortgage and with a home that has increased in value over the years, your home is your greatest asset. And as such, using the value tied up in it makes complete sense. You’ve spent years investing in your home so isn’t it about time it paid you back!

So, what are your options?

Converting the value tied up in your home into cash can be done in one of two ways:

  1. Downsizing:
    Sell your home, buy a cheaper property and then enjoy the money left over, after you’ve paid the associated fees.
  2. Equity Release:
    Take out an Equity Release plan to enjoy a tax-free lump sum (or regular payments) and remain in your family home until you die or move into permanent care. Find out more about the different types of Equity Release Plans here.

Of course, there’s a lot to consider and there’s never a one size fits all approach but here are the headline considerations for anyone weighing up their options:

Upsides to downsizing

Financially simple
Sell your home for market value, buy a cheaper one, pay the associated moving and legal costs and use the rest however you wish.

Economical & Practical
Chances are you will move to a property with lower running costs and less up-keep, which can be extremely useful if you are struggling with mobility or looking to reduce costs.

Ownership & inheritance
Your new house is 100% owned by you and when you pass away you can leave it to your family as inheritance.

Family support & new scene
If you want to live closer to your family, this could be your chance. Other people want to move nearer to the sea or somewhere completely different.

Downsizing Downsides

Emotional Upset
For many people the thought of moving out of their family home and leaving all those treasured memories behind is just too much. A smaller house typically means reducing your possessions and so you might be forced to get rid of items you love and may have had for years. Many people find this all too much to contemplate.

Into the unknown
If you are looking to free up large amounts of cash you may end up having to move to an area where the property prices are lower. At this time of life many people prefer to stay where they know, surrounded by good friends and the life they have built up over the years.

Expense, hassle & stress
It’s easy to forget the sheer expense of moving, even when you’re downsizing. With Estate Agent’s fees, Solicitor’s fees, removal costs and often stamp duty still to add on to your initial purchase price, you may not be left with as much as you’d hoped. And, as one of the most stressful things we do in life, moving house certainly won’t be a hassle-free experience.

Less space for guests
Many people tell us that, whilst they don’t need the space every day, they love being able to have the family to stay, especially at times like Christmas and birthdays, and that they would hate to have this taken away by moving to a smaller house.


Equity Release ups

Stay in your family home
By choosing Equity Release you can still release the value tied up in your home, without the hassle, upset and stress of moving. With an Equity Release plan you are guaranteed to live in your home until you die or move into long-term residential care.

Tax-free cash to spend as you wish
Whether you are looking to treat yourself to luxurious holidays, undertake some home improvements, pay off an existing mortgage and reduce your monthly outgoings or simply boost your retirement income to enjoy life’s little pleasures, the choice is yours!

Help you family & be there to see it
The ability to provide your family with a living inheritance is becoming more and more popular. Many people would rather be around to see their family enjoy and benefit from their money now, rather than having to wait until they’re not around.

No monthly payments (unless you choose otherwise)
Once your plan is complete all you have to pay are the one-off set-up and advice fees. Any money borrowed is only paid back upon the sale of your house, which only happens once you die or move permanently into residential care.

Flexibility & Protection
There are many different Equity Release plans out there, which means that you can choose the one that is right for you. Maybe you’re looking for a single lump sum, regular drawdowns when you need them or a combination of the two.  And, because we only use plans approved by the Equity Release Council, you have the peace of mind that you are fully protected and in safe hands. The No Negative Equity Guarantee also means that you or your family will never be left owing more than your home is worth.

Equity Release downs

Reduced inheritance
Because the money released is typically repaid upon the sale of your property this reduces the value of your estate and therefore affects the amount of inheritance you can leave to your family. And, of course, you can’t leave the property itself as inheritance.

Limited borrowing
The amount you are entitled to release depends on a number of factors including your age, the value of your home and your current state of health

Associated costs
Whilst typically far less than the costs associated with downsizing and moving, as with any financial service there are initial fees associated with Equity Release. These are dependent on how much you release and the plan you choose. Your Adviser will be 100% clear on these costs before you agree to anything and you will never be asked to pay anything up-front.

Interest roll-up
With plans such as a Lifetime Mortgage the interest owing builds up over time. So, the longer you have the loan the larger the amount that will need to be repaid upon sale of your property, when you die or move into long term residential care.

 Advice you can trust

As we said earlier, and as with any big financial decision, there is a lot to consider. Which is why you need access to specialist advice you can really trust. It’s important that you have all the facts, that everything is explained clearly and that you feel well informed to make the very best decision for you and your family.

Equity Release isn’t right for everyone but more and more people are choosing it over selling the family home they love. For many Equity Release is a win-win solution; they get to stay in their home, still have the money they need to fund a comfortable retirement and get to see their family enjoy a living inheritance.

“This company cares”

As one of the UK’s leading equity release specialists, it goes without saying that the TRER team are highly experienced and knowledgeable, but what really stands us apart is our dedication to customer care, as reflected by our ‘Excellent’ Trustpilot rating.

The Right Equity Release on Trustpilot - SEPT26
So, If you have any questions about Equity Release, please get in touch with our friendly team for a no-obligation chat on 0800 612 6755.

To find out more please click here to speak with one of our experts
Find out how much you could release with our FREE Equity Release Calculator.

Thanks for reading, Sarah

Photo by Lachlan Gowen on Unsplash