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

[Powerbungalow]

I'm not being unsympathetic

Theres a lady on the news at the moment, saying how times are tough and shes only cooking one meal a week - imagine she's eating cold food.

One thing that stood out though "I own my own house and it costs in maintenance" Depending on where she is, would you not get a life time mortgage or sell and rent? She has a big asset, why not use it to have a better life? I know I would.

She may be holding on to it for inheritance, but she didn't say - if so, then can her family help. It just seems totally crazy

It's not that straightforward or easy, it is like taking out another mortgage in a way. I've looked into it.

I did look her up and she's been featured on TV and in other articles like this for years. It's all slightly odd and I don't think she is genuinely as poor as she makes out.

Equity release is a shit idea, but there’s still downsizing. And if people don’t want to do that either, what else do they expect? The government to bankroll them whilst they sit on a valuable asset they do nothing to realise the value of?

Also why does she keep giving people lifts? If she’s that skint she’d ask for petrol money.

One of my friends has just moved house prior to retirement, oddly she has gone for a bigger house with a much bigger garden and steep steps but she is able bodied and it is her choice. That aside she has done it at the right time in the sense that the move with all the expense, stress, upheaval nearly broke her at age 65 and being single she handled it all by herself. That would be a huge challenge for anyone really elderly. She moved because like me she lived in a rough area and had had enough and also realised that it was now or never in terms of age as it is such an all encompassing and very expensive process.

As opposed to people who have relied on the state for ever?

My parents considered downsizing

But .....

Couldn't agree what they might like to move to

Cost of stamp duty, moving etc put them off, as they didn't want to move to a smaller property and not raise cash in the process. They felt better to stay in the bigger house so that, if they ended up moving to a care home, they ould raise more £ by selling the larger house in order to pay care home fees

And the prospect of downsizing was v daunting for them. I think betterto move in your 60s when you're still young enough to handle the physical and emotional aspects of moving house

I dont know if that is the same woman, but my question is more of a general one.

If you have no money, and you're not eating, and you have an asset such as a home, then what will it take for you to use it?

Selling and buying a smaller cheaper place would make sense but doesn’t make a good news story. If you are in certain parts of the country owning won’t necessarily mean you have much capital but for most people you are sitting on hundreds of thousands, even more, there’s no justification for talking to journalists about your finances if you have lots of capital, you need to get good advice starting with age U.K.

Downsizing seems a good idea on paper if someone is still fit and able.

But the options open to someone who needs walking aids/wheelchair space are greater for someone living in a larger property than if they had downsized to smaller property.

In a larger property you could potentially live downstairs easier and have bedrooms still available for family/overnight carers if needed. You have likely got more space to manoeuvre on a walking frame or in a wheelchair.

I would suggest to anyone of my age - early 60s - to think about whether you do want to stay in a larger family home long term, and consider what adaptations might be needed (downstairs bathroom for example). You can't cover all eventualities, but a bit of forward planning while you are still working could be very helpful long term.

I have seen first hand the difficulties of older people not wanting to move from the home they have lived in for years, but the home is now not meeting their needs and almost becoming more of a prison as they can't manoeuvre around it, or get down the steps into the garden etc , and their quality of life deteriorates.

This is what every widow did back in the day taking lodges being a landlady. It’s good to hear someone else wants to do it.

I have heard awful stories about equity release schemes, and how badly old people have been treated, @Powerbungalow. Plus the house is the person’s security - if they need to go into a home, selling the house might mean they can afford somewhere nicer. And if they don’t need to sell it to pay for care needs, they know they will be leaving a substantial legacy for their children.

Because equity release is a poor financial choice.

Many older people would struggle significantly with the stress and practicalities of moving.
Older adults rarely do well when they have to move - unfamiliar spaces means a much higher risk of accidents, eg trips and falls. Much harder to learn the new area and make new links as an older adult. And that's before thinking about the mental aspect of leaving somewhere that has been your home for many many years.

I agree with this. If a working adult was living beyond their means then everyone would be saying they need to make an active decision to change their circumstances, yet when it’s a pensioner we are all expected to bring out the violins. Wanting to leave as much money as possible to the next generation is a decision that so many pensioners are actively making, and with that comes consequences.

If I was in that pensioner’s position I would sell up and rent a nice retirement flat, there are plenty going.

Who are these people? I guess if you know them then there is the possibility that you too live in a valuable property. I'm old and a despised boomer and my house is worth about £150K and none of my contemporaries live in homes worth anywhere near £1million. In fact I have a couple of friends who rent due to complicated and difficult life events.

They don’t want to use it OP, they want the government to spend yet more money on bailing out the (statistically speaking) wealthiest generation this country has ever seen. No amount of money is ever enough for today’s pensioners I’m afraid.

i want to leave my kids simething to make their lives easier

id struggle for that

Not heating or eating seems to tick that box!

I’m waiting for all the posters who will start talking about the world wars as if today’s pensioners were on the front line or something. It’s so bizarre! An 80 year old today would have been born in 1946 - they weren’t putting out fires in the Blitz!

Equity release is as good as handing over your home to the vultures

Its not a house. its not an asset. its not a retirement pension. its a home.

people have memories tied up in their home. maybe her husband died whilst they were living there and this is the last place she can remember him "being". maybe she has wonderful next door neighbours who look out for her, take her shopping pop in for a chat. Maybe she is on a bus route or can walk to a shop or the pub. maybe she volunteers nearby or is surrounded by friends.

and if she sells up and moves away ALL of that is gone. and the next house stays a house and doesnt become a home. it needs emotional intelligence and empathy to realise this. perhaps as you get into your 60s and 70s like me you might realise how important somewhere being home is.

I assuming from your post that you are young and that you dont have to worry about social exclusion and boredom and feeling useless and unable to cope in this society. older people are being left behind massively by the influx of new technology. their home is their safe and familiar space.

In an ideal world so do I, but if I need to pay for my care I guess I won’t be able to.

Selling to downsize and buy a smaller property could be sensible, depending on the size of her house. Selling to rent would be a bad idea as rents are so expensive and would quickly use up the capital and be in the same position again. Equity release is bad news as the interests rates are so high there'd be no capital left after a few years.
Perhaps the older person may be entitled to pension credit which would then entitled her to other benefits like council tax relief.

And all of that is perfectly valid. In which case this person has to accept that she cannot afford enough food. You either accept an alternative or you don’t. Young people go through trauma and have to deal with a lot of difficult situations as well, but they are expected to pick themselves up and get on with it.