The independent research carried out by Oxford Economics for specialist insurer Just Retirement looks at the impact of equity release on pensioner poverty and the wider UK economy in terms of GDP, jobs and tax revenues.
Around one in every seven pensioners has a disposable income of less than 60% of median household income, the "relative poverty" threshold defined by the Department of Work and Pensions. That is 1.7 million pensioners overall, of whom 60% own their own homes outright. Of the very worst off pensioners, the 0.8 million classified by the DWP as suffering ‘material deprivation’, 38% own their properties outright.
"The squeeze on pensioner income is very real and only likely to tighten in the coming decades as defined benefit schemes are replaced by less generous pensions and the state is forced to focus its limited resources on those who need it most," said Stephen Lowe, group external affairs and customer insight director at Just Retirement.
"But many of those approaching and in retirement with inadequate pensions and few other sources of income do own their own properties and have significant wealth locked up in bricks and mortar. This research uses economic modelling to try to quantify the benefits that tapping into some of that wealth might bring."
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