RETIRED homeowners are using equity in their properties to fund their dream holidays, new figures reveal
The findings, from over-55s finance specialists Key Retirement, show the average amount spent on trips abroad using property wealth has hit nearly £6785.
Their figures also revealed that nearly a third of customers taking out equity release spend some of the cash on holidays or to help finance holiday homes.
Those buying holiday homes in the UK and abroad released an average of £58,850, with Spain still a popular destination for a home overseas.
Holiday spending includes once-in-a-lifetime trips to far-flung destinations including Australia, New Zealand and Canada, as well as UK staycations, with people using their property wealth to improve their lifestyles in retirement.
For some, equity release was also used to pay for trips to see loved ones living overseas.
Equity release is available to homeowners aged over 55 and allows them to release a tax-free cash lump sum from the value tied up in their property. The money can be spent on anything from home improvements to holidays, making it a popular option for retirees looking to enjoy later life with some extra money.
The most popular form of equity release is a lifetime mortgage, which typically has no monthly repayments as the amount owed doesn’t need to be repaid until the homeowner dies or moves into long-term care.
An average of nearly £6785 is spent on holidays abroad by over-55s using equity release
Dean Mirfin, technical director at Key Retirement, said by tapping into the equity tied up in their homes, over-55s are now opening up new opportunities to travel and make the most of life.
He said: “With an average spend approaching £7000 for holidays, travel is a popular choice for those unlocking cash from their homes, often alongside other uses to improve their lifestyle in retirement.
“Whether it’s jetting off to exotic climates, purchasing a holiday home or visiting relations in far-flung corners of the world, property wealth is providing the opportunity for over-55s to visit places they have previously only dreamed of.
“It is also enabling many to have a second home in the UK or abroad that, for many, would not be possible without access to the wealth tied up in their main homes.”
He added: “Property wealth is becoming a major part of retirement planning and can substantially improve quality of life.
“Customers using equity release are releasing an average of £72,000 from their homes to meet a range of financial needs and wants in retirement.”