Why equity release may be the answer for women
The life insurance provider’s April 2017 Readiness Report looked at “How savers are behaving in the new pensions world” and found men had saved on average three times more for their future than women.
Men have an average of £73,568 put away for retirement, while women’s pensions amount to an average of only £24,869.
And with a quarter (24.5 per cent) of the UK population now expecting to continue working full-time past the age of 65, more retirees are looking for alternative ways to finance their later years.
Equity release is one such option, and is available to over-55s who own a property worth at least £70,000.
An equity release plan allows homeowners to release a tax-free cash lump sum from the value tied up in their property, and can be used for everything from boosting everyday spending to clearing debts.
Figures from over-55s finance specialists Key Retirement show Scottish property owners added to their retirement finances by more than £86million in 2016 thanks to equity release.
Of the nearly 1600 Scottish pensioners who used equity release last year, nearly half (49 per cent) invested some or all of the cash in revamping their home, about 34 per cent settled debts and 16 per cent funded a dream holiday.
But the report also highlighted a clear gap between women’s financial priorities and their levels of protection.
Nearly half (46 per cent) of women believe it’s solely their responsibility to financially support their family should the unexpected happen and many would be forced to turn to their partner’s income, savings or government benefits.
The findings may go some way in explaining why women are more canny with the cash they get from equity release on their home.
Men on average spend £48,000 of funds released from their homes to help loved ones, compared with £32,000 from women.