The new generation of pensioners would release equity to enhance their retirement rather than leaving a property for their children to inherit, a new study of over-50s by Saga's Equity Release Service reveals.
Only one out of ten respondents (12 per cent) said equity release
products were not an option for them because they believed assets like a home should be handed down to their children as an inheritance.
A further 12 per cent answered that they had released equity from their home to pass on to their family as a pre-inheritance.
By contrast, a quarter stated they would use the equity tied up in their house to enhance their retirement regardless of their younger relatives' expectations of an inheritance.
New cars and golf club memberships feature high on the retirees' wish list, topped only by extended holidays in exotic destinations. One in five of those over the age of 65 said they would use the cash obtained by the equity release scheme to travel round the world.
Statistics show that 62% of over 50s own their own home, and by the age of 60 a nearly 80 per cent will own their home outright, rising to 99 per cent when they reach the age of 70.
However, there may be a significant North-South divide when it comes to releasing equity. As the average house price in the South is 42 per cent higher than in the North of the UK, homeowners in the South will be able to spend or preserve considerably more compared to their Northern counterparts.
The trend to spend the money for themselves rather than on the kids seems to be on the increase: whereas only 18 per cent of the over-65s said they considered equity release to travel around the world, this figure doubled (36 per cent) in the age group between 50 and 54.
Some children might not even be aware that their parents have released equity from their property, as only half of the respondents between 50 and 54 said they would discuss their plans with their family.
Andrew Goodsell, CEO of the Saga Group, commented on the findings: "We have seen an increasing amount of customers use the equity from their home to fund retirement. We have even had a customer recently who released money from their home to pay for their golf club membership!"