Only 7% of homeowners who have taken financial advice about their retirement plans said their adviser brought up equity release unprompted as a means of support in retirement, according to Canada Life.
One in 20 homeowners said they asked their adviser about it, and more than three-quarters reported not discussing equity release with their financial adviser at all.
Importance of equity release to rise
Pete Maddern, managing director of retirement at Canada Life, said unlocking money tied up in property wealth is likely to become an increasingly important part of retirement planning as people live longer and see their pension savings dwindle.
The survey findings showed that fewer than half of homeowners were confident that their savings and income would last through retirement. With property accounting for 40% of total household wealth in the UK, exploring ways to access this wealth will be an important part of ensuring financial security in later life, according to the provider.
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Meanwhile, nearly three-quarters of homeowners are familiar with equity release, but understanding and knowledge of the product remains limited, and legacy misconceptions of later life lending persist.
Maddern added: “It’s encouraging to see the progress the FCA has made in recent months to explore how the later life lending sector and advice framework should evolve.
“While equity release will not be right for everyone, these developments have the potential to improve consumer understanding and awareness of later life lending, and to enable advisers to have more holistic conservations with their clients about whether equity release could help them achieve their later life and retirement goals.”
Last year, the FCA published the Mortgage Rule Review, which included the suggestion to mandate equity release qualifications to ensure consumers got holistic advice.
Analysis by Mortgage Solutions found that mainstream mortgage advisers have already begun recognising the need to become more holistic by adding later life capabilities to their services before the regulator decides on any changes.
