The Bank of Parents and Grandparents.
Nigel Waterson, Chairman of the Equity Release Council recently posted the following comment on the Council’s website:
“There is substantial wealth tied up in the family home and through the use of equity release, this can be unlocked and used to tackle financial pressures across the generations”
The whole demographic of inheriting legacy has changed over recent generations largely caused by improved lifestyles and greatly improved medical advances. In previous generations there existed the old adage of reaching the age of “three score years and ten represented a long and happy life” In today’s terms getting into your seventies represents just another phase of retirement.
In those circumstances children into their late forties and early fifties tended to inherit from their late parents at a time when they probably most needed it. Their own children may have needed funds for house purchase or to fund education or to pay for weddings. Whilst this is a generalisation it nevertheless represented what generally happened.
To give you an idea a male age seventy has an average life expectancy of 18 years and a female aged 70 has an average life expectancy of 25 years. This combined by healthier lifestyles and medical advances means that not only are people living longer but also equally important they are much more active for much longer.
The needs of children and grandchildren have not however changed and many still need that financial support to help then as they set out to define their own lives in their 20’s and 30’s. This is where equity release can help and make a difference as it does provide a way to still provide this support using the equity either in parents or grandparents property.
You may have clients who find themselves needing funds to support family for whatever reason and Releasing some value from the equity of parents or grandparents property could we’ll be a feasible solution. It may not be the solution for all but until we have the conversation I cannot help find the best solution to meet that need.
IF YOU THINK I CAN HELP RING ME ON 01704 512120 OR 07714 414545
Equity Release includes home reversion plans and lifetime mortgages. To understand the features and risks, ask for a personalised illustration.
For equity release we can be paid by commission, or a fee of usually £895 or a combination of both.
Steve Harrison CeMAP, CeRER
Equity Release Consultant