The number of homeowners looking to release equity from their properties to boost their savings and pension pots is on the increase, according to the latest research.
Figures from the bi-annual Prudential Downsizing Index reveal that 41% of homeowners over the age of 55 plan to sell their current property, with 75% of those saying they wish to downsize in order to release cash to bolster their investments and spend on luxury big ticket items like holidays. That’s an increase from 38% in May.
The so-called ‘last time buyers’ are seeking an average of £87k to fund their plans.
Vince Smith-Hughes, retirement income expert at Prudential, said: “Our homes are often our most valuable assets, but also one of our greatest expenses. The financial benefits of downsizing, from both a cost-saving and releasing capital perspective, can be very enticing. But those who are considering it should exercise caution and be careful not to overestimate the level of funds they expect to receive.
“Freeing up cash as a result of selling your property may be appropriate for some, but it should never be seen as a substitute for saving for retirement. The best way to secure your desired standard of living in retirement is to save as much as possible from as early as possible and to seek professional financial advice on the best retirement income options available for your needs.”