As you approach or approach retirement, it’s completely normal to have questions about how you’ll fund the years to come.

Have you thought about your retirement plans? Are you looking to achieve the things you’ve always wanted to do, like a long-distance vacation or buying a campervan, or simply maintain your current standard of living?

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Calculate how much you could unlock

From there, you can begin to consider whether your current financial plan can maintain this or how you could further supplement your finances.

One option to supplement finances that thousands of homeowners choose each year is equity release.

Equity release is a way to unlock some of the money tied up in the value of your home, so you can enjoy it now.

This can range from a minimum of £10,000 to 53% of the value of your property.

What does releasing equity involve?

There are two main types of equity release plan, a lifetime mortgage and a home reversion plan. A lifetime mortgage is secured on your property and any money released, plus accrued interest, is repaid upon death or transfer to a long-term care facility.

A home reversion plan involves selling part of your home, which you can continue to live in until you die or move into a long-term care facility.

Both types of plans will reduce the value of your estate and impact long-term care funding.

It’s a condition of equity release that you must first pay off any existing mortgage, but once you’ve done that, the tax-free money is yours to spend. Whether it’s a vacation, home renovations or supplementing your finances.

One of the benefits of equity release for many people is that no regular repayments are required, since all the money you release, plus accrued interest, is repaid upon your death or move into a long-term care facility.

Plus, you can choose to receive the money in a lump sum or in smaller amounts over time, and plans that meet Equity Release Council standards come with an equity guarantee non-negative, meaning your estate will never owe more than your house. value.

Reduce headcount to raise funds

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Calculate how much you could unlock

As our lives change as we age, we may no longer need the same size house as before.

Maybe the kids have grown up and moved out, or accessibility needs mean you’d be more comfortable in a smaller, one-story home.

Downsizing or moving to a cheaper property can be a strategic decision for those looking to improve their finances in their later years with a lump sum of cash.

By selling a larger family home and purchasing a smaller, more manageable property, retirees can unlock significant property equity, which can then be invested or used to supplement their retirement savings.

Moving to a smaller property could also reduce ongoing expenses such as maintenance and utility bills.

Downsizing can also provide the opportunity to move to a more desirable or affordable area, potentially improving quality of life while ensuring a more comfortable retirement.

However, many people do not want to leave the home they feel settled in and which holds many memories, and the emotional and physical upheaval associated with it seems daunting.

Rent a room

If your home is too big for your needs but you don’t want to move, you might consider renting a room to raise money for retirement.

The Rent a Room system is open to owner-occupiers or tenants who rent furnished accommodation to a tenant of their main residence.

This can be a great way to supplement your income and provide housing for tenants. But the income you receive may have an impact on certain means-tested benefits.

It lets you earn up to £7,500 a year excluding tax, or £3,750 if you rent jointly.

It is not necessary to be an owner to benefit from this system. If you are a tenant, you can also rent a room to a tenant, provided your own lease allows it.

This option may not appeal to some because it requires sharing living space with someone else, which can be a difficult adjustment if you’ve been used to your current living arrangements for a while.

Age Partnership is a trading name of Age Partnership Limited, which is authorized and regulated by the Financial Conduct Authority. FCA registration number 425432. Company registered in England and Wales under number 5265969. VAT registration number 162 9355 92. Registered address, 2200 Century Way, Thorpe Park, Leeds, LS15 8ZB.