Apr 13 2006
Pensioners are set to rely on their property to provide extra income in retirement as worries about a shortfall in the state provision grow, said a new report.
One in four pensioners realise they will not have enough money to fund their retirement and many are starting to think of other ways to make ends meet, according to research from Prudential.
Home-owning OAPs are considering using their property to raise extra cash, as one in five are considering downsizing and one in six would consider taking a lodger.
"As more pensioners realise that they might outlive their provisions in retirement, some feel compelled into some pretty drastic measures," said Ali Crossley, Prudential UK director of lifetime mortgages.
Another option for some pensioners trying to top up their income could be an equity release scheme such as home reversion plans or lifetime mortgages.
Home reversion plans offer consumers a chance to access some of the value of their homes by selling some or all to a third party and lifetime mortgages are where homeowners can effectively borrow against the value of their property.
"A lifetime mortgage can suit people who do not want to leave their home in retirement," said Prudential's Ms Crossley.
"More people are considering this option nowadays, and this is in part because better, more flexible products have appeared on the market."
