The Intermediary – June 2025 - Flipbook - Page 64
L AT E R L I F E L E N D I N G
Opinion
May you live in
interesting times
T
here is a phrase which
suggests that we should
never live in ‘interesting
times’. The implication
is that bad things
will follow. We are
definitely living in interesting times,
and our sector is arguably facing one
of the potentially biggest turning
points that it has ever seen. And I
believe it promises to be good news!
Radical thinking
We’ve all heard the fact that the
market has to grow, that pensioners
are not able to sustain their standard
of living, and that property wealth
is a potential answer to many of the
sticky questions facing Government.
However, while the sector has been
preparing for growth, building
standards, developing advice excellent
and looking for referral relationships,
we’ve yet to see this forecasted growth.
Now, change is on the horizon.
At the start of March, Nikhil Rathi,
chief executive of the Financial
Conduct Authority (FCA) announced
that in June, there would be a public
discussion into lending in later life.
This was followed by a speech at
the JP Morgan Pensions and Saving
Symposium at the end of March,
which talked about “bold ideas for a
joined-up future.”
He mentioned radical thinking
and asked whether, “with the right
product design and consumer
protections in place, could later life
lending benefit more people, as part of
an individual’s financial plan, rather
than a last resort?”
It’s a question that the Equity
Release Council has long pondered. As
a trade body and a standard seer, we
are commied to empowering more
over-50s to make informed choices
about property wealth. Not everyone
can – or indeed should – access their
housing equity, but every homeowner
should consider what role property
plays in their retirement.
To beer understand this role,
the Equity Release Council asked
independent consumer group Fairer
Finance to consider how property
Every homeowner should consider what role property wealth plays in their retirement plans
64
The Intermediary | June 2025
JIM BOYD
is CEO of the Equity
Release Council
wealth can bridge the later life
funding gap.
Using new economic modelling,
they concluded that half of UK
households are expected to require
housing wealth to support their
funding needs in later life and
retirement. They went on to say that
should this happen, we would see a
£21bn annual boost – in today’s prices
– to the economy from 2040.
To deliver this possibility, Fairer
Finance went on to make five policy
recommendations, which included
the provision of more age-friendly
properties, no Stamp Duty for lasttime buyers, and the normalising of
housing wealth usage in later life.
Ambitious plans
They also suggested that we need to
reform regulation around later life
advice, to break down advice siloes
and ensure consumers are supported
to maximise the use of all their assets
as they approach retirement. This is a
big ask, but one that has the potential
to pay off for every organisation
and individual who operates in the
property and pensions arena.
While some problems clients face
cannot be solved by good advice, there
are many which can, and no adviser
wants to turn someone away. We
must build a market where clients are
comfortable discussing how housing
wealth can support their retirement
aspirations, and how, as advisers,
you can help them or get them
the help they need. It’s ambitious,
but aainable.
I look forward to reading the FCA’s
discussion paper and I am confident
that we will buck the trend – as
‘interesting times’ can now mean
change for the good – good news for
our sector and our customers! ●
