Housing wealth should become a mainstream part of retirement planning rather than a niche financial option according to industry leaders speaking at the Equity Release Council’s annual Later Life Lending Summit.
The call comes as new research suggests almost half of homeowner households approaching retirement are unlikely to have enough income to achieve a moderate standard of living in later life.
Policymakers, regulators, lenders, advisers and consumer groups gathered at the Council’s sixth Later Life Lending Summit to discuss how housing wealth can be responsibly integrated into long-term financial planning while maintaining strong consumer protections.
The debate was informed by findings from Retirement Compass, a research programme developed by Fairer Finance and commissioned by the Equity Release Council, which found that many homeowners are asset rich but income poor as they approach retirement.
RETIREMENT SUPPORT
Delegates heard that housing wealth could play a greater role in supporting retirement outcomes, particularly as demographic changes place increasing pressure on pension provision and retirement incomes.
The event also featured contributions from Emad Aladhal, Director of Retail Banking at the Financial Conduct Authority, as the regulator continues its Later Life Mortgages Market Study examining consumer outcomes and market development.
A key theme throughout the discussions was the need to balance market growth with robust consumer protections, professional advice and high standards of customer care.
Particular attention was given to the financial challenges faced by women in retirement. Speakers highlighted how career breaks, caring responsibilities, divorce, longer life expectancy and lower average pension wealth can leave many women more vulnerable to financial insecurity later in life.
PROPERTY WEALTH
Jim Boyd (main picture), Chief Executive Officer of the Equity Release Council, says: “According to the Pensions Commission, women approaching retirement have around half the median pension wealth of men. This is not a marginal issue – it affects half of our population.
“If policymakers are serious about improving retirement outcomes, they must recognise the role that housing wealth can play alongside pensions in supporting financial resilience.
“Fairer Finance’s research shows that property wealth could make a meaningful difference to many women’s financial security and quality of life in retirement.”
IMPORTANT ROLE TO PLAY
Reflecting on the wider discussions, Boyd adds: “What was most encouraging was the level of consensus around consumer outcomes rather than individual products.
“Whether the discussion was about regulation, advice, funding, technology or housing wealth, the message was consistent: people benefit most when they are supported to consider their complete financial circumstances.
“Housing wealth has an important role to play in helping people achieve greater financial security in later life, but that can only happen if consumers have access to the right information, guidance, protections and advice. Supporting good consumer outcomes must remain at the centre of everything we do.”
