With their own property, but little in the way of readily accessible cash, some pensioners are facing a dilemma.
Property wealth in the over-65s has hit an all-time high, reaching an astonishing £1.072tr. While this shows that the housing market is in great shape, it’s a bit of a mixed bag for pensioners. For while they may own property (maybe even more than one) they don’t have much in the way of readily available cash. For some, that means facing having to sell their home if they need money unexpectedly. Luckily though, there is a solution.
Sometimes you can run into financial trouble when you least expect it. There’s no need to panic and immediately resort to selling your home though. Many older people aren’t aware that you can take out a loan against your pension. Now, this can sound a little scary at first. After all, that money is for your retirement. It’s a really simple process though, and gives you full control over your finances.
A pension loan allows you to use your retirement savings as a cash loan. This means that you won’t be running up lots of expensive credit. Now, the term loan might be a little confusing in the sense that you aren’t really borrowing from your pension – you’re just placing those funds into a trust.
Having your money in an accessible trust is really reassuring, and will eliminate the worry of you needing to sell your family home. You’ll be able to see how much cash you have in total, so you’ll still be able to plan for your retirement. You’ll just be able to withdraw money from that trust as and when you need it. Whether it’s car repairs, paying off a loan or urgent home improvements, you’ll be able to use your money for things that really matter to you.
It’s not unusual to have all your wealth tied up in property, and many older people find themselves in the situation of having no cash at hand in an emergency. If you borrow against your pension though, you can instantly access thousands. Now, doesn’t it feel better to know that you have something to fall back on when you need it most?