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Older homeowners sitting on gold mine but struggling with credit card debts – Rozario

by: Andrea Rozario, chief corporate officer at Bower Retirement
  • 09/07/2018
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Older homeowners sitting on gold mine but struggling with credit card debts – Rozario
Entering retirement in debt is never ideal. Nobody plans to still be paying off credit cards, loans and mortgages into their later years, but that will be the reality for millions of us.


All of us wish to have a relaxing retirement where financial worry is right at the back of our mind.

However, for many this won’t be possible. According to research by Prudential, it will take more than three-and-a-half years for the average retiree to be debt-free, costing £285 a month on average.

For many people, this £285 will be a significant amount as pensions continue to drastically underperform and retiree’s savings are dwindling.

Not to mention the fact that today’s older generation are living 10 or even 15 years longer than their parents – so where can they find the money to survive?

Well, one thing we do know about the modern retiree is that they have, on average, large amounts of property wealth.

Some data put the figure the over-65s control at an enormous £1.1trn nationwide.


More equity than debt

In reality, the average retiring property owner has far more housing equity than any sort of debt, and options like equity release are therefore becoming very appealing as a way to not only consolidate their debt, but also secure the retirement freedom they desire.

Modern, flexible equity release products delivered by a growing number of heavyweight lenders are proving to be a solution for many retirees.

Currently, thousands of homeowners are sitting on a gold mine while simultaneously struggling with debts like credit card repayments.

Downsizing will remain an option forever, but who really wants to sell-up and move from where they are comfortable in later age?

Equity release is helping people tap into the locked away potential within the value of their property, and we need to continue to deliver the products that the people need, helping those who are juggling debts to free up their retirement.

Clearly equity release is still debt and it’s crucial that customers understand the impact of compound interest and the effect this has on their estate, but for many whom live with the burden of paying off debts each month this route can be more than a viable option and a blessed relief.


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