We all save for our retirement years so that we can live a stress free post-retirement life. But the increase in the price of all the essential commodities has ensured that no amount of money is enough. Even those who have a regular job are facing huge difficulty ion managing their household bills. Many belonging to the lower income groups are seeking assistance from the various charities. The situation is worse for the retired as they have a limited amount of money for the last years of their lives.
According to many the living cost of the urban areas is higher compared to their countryside counterparts. But recent research has disillusioned them by showing that the living costs in the countryside have had a 100% increase. This is blamed on the fuel prices and the fact that they have to travel a longer distance than those who live in the cities.
Now, the retired homeowners are left with no other option but to release the equity on their homes. There are a number of equity release schemes that one can consider. The life mortgage plan provides you with lump sum cash without your having to pay anything in return. But the equity release provider will take away your home after your death. If you want to avoid this then you can go for home reversion plan. Here, you can release the equity on a part of your home. This will make sure that you can leave something for your children. But since you won't be selling the whole of your house, you won't get the fair market price.
Even though the financial experts advise against releasing equity at an early stage of life, the retirees are not left with any other choice. According to them, if you release equity at a later stage then you will gain more than if you release equity at an early age say 55. The best age to release equity is the late 60s. But the economy gloom and doom that is enveloping them is making it impossible to last that long with their savings. So releasing equity on their property is the only option left for them.