AIBU to wonder why a pensioner struggling financially would not use housing equity?

There's often more to it. My mother and step live in a four bed home, fortunately a chalet bungalow, worth about £750k. A few years ago they'd had it valued and were set to downsize to a smaller two bed bungalow to make their lives easier. They were both fit and well in their 80s. Then mother's heart condition hit, then the parkinsons and mi or strokes. Step developed vascular disease. Frailty was swift and moving as swiftly off the cards. They wouldn't cope now with a move, mother can barely remember where the downstairs bog is, post a renovation twelve years ago.

Fortunately, money isn't an issue and gardeners are organised and I can visit weekly.

It’s like listening to a bunch of fourteen year olds talking about adults. They are so sure they know all there is to know.
if you were discussing the plight of refugees they’d be quick to admit they can’t know what it’s like for those people.
Agism is like air or electricity.. they literally have no idea they are being agist, it’s invisible to them that they are talking about older people with patriarchal contempt.

Maybe they think they will need it for a care home!

No need to try and smear left leaning people as ignorant and unsympathetic and unimaginative- the cheap nasty jibe really undoes any point you are trying to make

yours truely
left leaning

Don’t think you get means tested benefits if you have the full state pension.

Also remember that many older people don’t actually realise what kind of asset they have

they often ( I have seen it ) can’t accept their house is worth what people say

and they are often partly right that the state of their home affects its value especially if it’s not been touched in years - they usually way underestimate its value

Equity release should only be an absolutely last resort in a really desperate situation.

I said those influenced the older generation, my grandmother was born in 1928, another grandfather was born in 1893, these people influenced their children's and grandchildren's attitude to money. Is this really so difficult to understand for all you highly educated left leaning women?

I'm I missing something with this story? Nothing seems suggests she owns a house she could downsize from?

I think of you literally can’t afford to eat, you’ve reached the option of last resort.

There was an article in the Money section of last Saturday's Daily Telegraph that sets out the pitfalls in some detail.

I would only consider it as the ultimate last resort.

Quite. all this talk about workhouses. What a load of cobblers!

Many pensioners grew up knowing they were one step away from the workhouse, (abolished in 1930)

So you'd have to be at least 110 to even remember that then...so no, not many pensioners at all.

What do people spend it on ? Mainly as an opportunity to get on the housing ladder, so the fact houses are treated inequitably in terms of taxation and counting towards benefits actually pushes their price up further and stops people getting them without an inheritance. Nicely circular.

Your opinion that you would ER is absolutely fine, just as someone else has a different objective to maximise their estate. There is no wrong or right in this IMO.

The government shouldn't be bailing out the "poverty stricken" with £2 million assets though.

Maybe there needs to be some sort of state sanctioned equity release scheme to attempt to clear up the reputation of this.

Some people would argue this is already in place re care home fees. However the government tends to not get involved with stuff like this due to the popularity hit it takes when things go tits up due to peoples poor planning. Hence banks.

There are reasons that older people leave it and leave it before thinking of moving and then come up with a raft of excuses as to why they wont.

I get that its a big unheaveal but dont go on national media bleating that
you cannot afford to turn the oven on. Your asset is literally in front of you.

There is someone up thread saying that it will cost them £30k in Stamp Duty. There is always always an excuse. I had to literally pin my elderly Mum down to move to a retirement flat. She claimed that she was fine living on her own miles from me. I ran her life admin but she called a lot, everything was a massive drama for her and needed to be done urgently because she worried and worried about things.

She would tell people she lived quite happily on her own but the house wasnt being maintained properly. The hot water didnt work properly either but she kept that all hidden from me.

But she won’t need her bungalow when she dies, they’ve spent their money having the retirement they wanted. Equity release may not be the most prudent financial arrangement but they have no obligation to leave their home as an inheritance if they need/want to spend the money while they’re alive.

Downsizing could be sensible if you needed more funds but equity release has a bad reputation.

Equity release is bonkers because you could outlive the income and be evicted.
However, I agree she should look to downsize within her local community.

Many pensioners grew up knowing they were one step away from the workhouse, (abolished in 1930) in their mind owning a home is their only protection against destitution. Those i knew worked harder, longer and for less money that most of us could imagine. Even in the 1960's benefits meant having a visit from an official to look at what was in your home, people were expected to sell furnishing and personal possessions pay for food, before being granted assistance. The People of the Abyss is a good read to help understand the mindset of those who influenced the older pensioners of today. Are we really going to go back to believing poverty is a moral failing?

My parents won't consider downsizing because 'we want to leave it for you and your sister'.
Despite us both telling them that we aren't waiting for them to die, they won't have it..
Their property, their choice

Is it squandering though, or is it just living your life when you have the health and means to do so? I do save for my pension but savings are definitely balanced by enjoying life in the here and now, doing things with the kids and having some lifestyle benefit that comes with a very hard won career. Otherwise what’s the point?

You don’t know what’s ahead of you, for every person I know living well into retirement, there’s another who didn’t live long enough to see their pension - and in some cases lived a very frugal lifestyle to ensure they could have a more comfortable retirement that they didn’t see.

Not really.

i live in a very cheap area. My house has 5 bedrooms. If I downsized to a 1 bed flat I could net 50k maybe after 30k costs.

it’s not really worth it.

when my youngest moves out I’ll probably rent out rooms.

My in laws did ER when my fil had got into a lot of debt.
He was really struggling with it mentally and carried the burden by himself.
My mil’s attitude towards money is like a child.
She just spends and spends in Waitrose, rather than the more sensible Aldi/Lidl.

whispers She wouldn’t want her neighbours to think she shops there!

So, my fil did ER and it’s not great, in the long run. When she dies, her bungalow is owned entirely by the bank.

Getting equity release is a really bad idea, everyone, and I mean everyone, knows this, apart from enough desperate and financially ignorant people to keep the con going.

My council tax would be about 200 a year less

i’m in a modern new build - energy costs and maintenance costs are low.

paying money out of savings to move somewhere smaller that’ll only save me 1k or so a year isn’t a financially realistic proposition.

i’m on pension now and don’t have those savings any way.