When Saga contacted me and asked me to tell you about Equity Release and to conduct a Twitter poll asking my followers what they would use the money for, I thought that it would make an interesting blog post. I had no idea what Equity Release was and I bet you don't either...
Equity Release is for homeowners over the age of 55. It's a way of unlocking a proportion of the value (equity) of your home in exchange for a tax-free sum. You remain living in your house until you die, but all or some of it would be owned by Saga or another provider who would pay you either a lump sum or a monthly income. At first, I couldn't understand why anyone would want to do this, but the more I thought about it, the more sense it made - if you have no family to inherit your property, you wouldn't want it going to the government, so Equity Release is a way of continuing to enjoy living in your home and getting the value of it in cash to spend whilst you are alive. There are, however, many other reasons for going down the Equity Release route.
Saga conducted some research into how their Equity Release customers intended to use the money they unlocked. 60% intended to use it for home improvement, followed by 41% using it for a holiday and 35% to clear debt. I conducted similar research on Twitter via a 4-day Twitter poll. My results showed that most would use it to clear debt (40%), followed by a holiday (29%) and home improvement (26%). I found these results really interesting as if I ever undertook Equity Release, it would be because I have no children to inherit my home and I would use the money to go on holiday and have fun with, or to clear any debt if I had any. My Twitter followers and the readers of this blog are mostly aged between 25-35, whereas the people surveyed by Saga are aged 55+ - the results, however, were still very similar.
Have you ever given any thought to this?
This is a collaborative post with Saga (UK) for which I was paid, but all opinions are my own. I have never been a customer of Saga, so I cannot vouch for any of the services they offer. Always do your own independent research before entering into any financial arrangement.
Photo Credit: Kari Shea/Unsplash
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