Retirement plans in jeopardy: equity release could be blocked if house prices crash
Clauses in equity release plans mean homeowners may not be able to continue taking equity from their houses next year. This is according to an article in The Telegraph, as the Centre for Business & Economics Research predicts a fall of 13.8% by the end of next year.
“The terms and conditions of drawdown are often loosely written so that the lender has wiggle room,” Simon Chalk of advice firm Later Living Now tells the newspaper. While he says some lenders are transparent about the options for borrowers in such circumstances, others are vaguer.
If equity release stops being an option, there are other options available. This is something we are well-positioned to help people with.
Numeracy skills: what is not adding up in the UK?
In the Financial Times, Bank of England’s Andy Haldane and celebrity maths teacher Bobby Seagull mark Number Confidence Week. This is a weeklong programme of virtual events which discusses why the nation’s number skills need boosting.
The UK was not in great shape with its personal finances, they write. They say that only one in four Britons of working age are functionally numerate. In 2016, the UK was bottom of an adult financial literacy league table of 17 OECD nations.
In the article the pair debate how this problem might be solved. They start with the approach of embedding personal finance into school curriculums. We have helped students with this as part of the Personal Finance Society’s “my personal finance skills” initiative. We want to do more of this when things are back to normal.
Pension UK: Retirees have adapted to Covid-19 as older savers embrace digital banking.
The third piece comes from the Express, which notes the impact of coronavirus seems to be changing the way older people deal with money. Research from Paragon Bank reveals how priorities have changed among the older generation. They say access to internet banking has become key.
Out of those between the age of 55-69, the majority (84%) say access to banking online was more important to them following Covid-19. Most older savers, particularly the over-70s, believe their spending habits pre-lockdown will return as soon as restrictions are lifted.
In the article, Paragon Bank savings director Derek Sprawling argues savers have adapted well to Covid-19 and its financial impact. He said “Many of those savers have established, long-term savings habits built over years, which means they are very resilient in the face of economic uncertainty.”