Equity release could help you escape to the sunshine

Scottish pensioners are turning to equity release to pay for extended holidays in the sun.

Homeowners over the age of 55 can unlock their property wealth to make their retirement dreams a reality.

The most popular type of equity release, known as a lifetime mortgage, is only repaid either when you die or move into long-term care.

According to leading over-55s equity release specialists, Key Retirement, property wealth boosted the standard of living for pensioners in Scotland by more than £46.6million in the first half of this year.

That’s a 20 per cent rise compared with the same period last year.

Retired Scottish homeowners released on average £45,000 tax-free each by cashing in on their homes during this time. Key’s Market Monitor found a third of Scottish pensioners are using the wealth tied up in their homes to pay for holidays.

You may want to relax by a pool in sunny Spain, or go sightseeing in Portugal or Malta.

Walking enthusiasts can explore the levadas of Madeira, the Atlantic island famed for its lush greenery and exotic flowering plants.

Closer to the equator, the Canary Islands enjoy yearround sunshine on beach destinations such as Tenerife and La Gomera.

If you’ve always dreamed of going further afield, you could visit China, Japan, South America or India.

Or you could travel across the globe to Australia and New Zealand where the climate is perfect at this time of year.

People also release their property wealth to make home improvements (64 per cent), to clear debts (30 per cent) or to pay off their mortgage (23 per cent) and more than a fifth used it to help relatives.

Dean Mirfin, technical director at Key Retirement, says: “Equity release is a real alternative for over-55s who are seeing traditional retirement income solutions squeezed by historically low interest rates, and pension incomes hit by historically low annuity rates.”