Nigel Waterson, chairman of the Equity Release Council, said: “With interest rates for equity release plans around three times lower than credit cards or overdrafts, it offers a chance to plan long-term rather than surviving from month to month, while also taking steps to safeguard an inheritance.
“There is an obvious and urgent need for politicians, policymakers, businesses and industry to unite in raising financial awareness so that older people are fully informed of their options as they make the transition from work into retirement.”
Since around half of older households are characterised as ‘conservative consumers’, it was stated that this shows how restricted their options have become.
Waterson added: “Use of unsecured borrowing may decline with age, but there is a clear danger that high use of consumer credit by older people in ‘squeezed middle age’ becomes another major obstacle to saving for retirement when many are already playing catch-up.”
“For those who own their homes, choosing an equity release plan which allows you to draw down regular instalments to boost your income can avoid this scenario entirely or help you cope better in later life by boosting your pension pot.”