Statistics from the Equity Release Council have indicated that unsecured personal debt amongst the over 65s is increasing at an alarming rate. Personal debt is up 16% from December 2013 to December 2014.
Balance on credit cards is up 29% and personal loans have increased in size by 2%. Though these are impersonal statistics, it does shed some light on the lived experiences many of us in the most senior population group have to endure with fixed pension incomes.
A stark warning is that 6% of those surveyed would consider pay day loans or door stop lending in order to pay the bills.
This is despite the fact that the over 65s are more likely to have no mortgage repayments to meet on a monthly basis and no dependents. Despite this, the most asset rich amongst us are still falling into increasing debt.
The option of releasing property wealth through a lifetime mortgage is still not widely seen as an option by many people.
This is partly because it is largely ignored in the financial media, and also because a large majority of the population confuse lifetime mortgage with much maligned products of the past, such as shared appreciation mortgages and sale and rent back schemes.
With the guidance guarantee being brought in from April this year by the government, to offer pension and retirement ‘advice’, we are likely to see more people consider housing wealth as a part of their personal budget calculations in retirement.
The Equity Release Information Centre has been offering advice on lifetime mortgages since 1985, and provides a whole of market, unbiased view on the products available today.
To obtain a copy of their free brochure on Equity Release please call 0800 077 6885, or visit their website at www.AskERIC.tv