Data published today revealed the number of single over-65s living alone has risen by 15% in the last decade and is set to reach four million by 2020.
Indeed, figures from trade body, the Equity Release Council (ERC), revealed over-65s will soon make up half of the single-person households in the UK.
As well as the death of a partner and rising life expectancy, one of the main reasons for this rise in single people in the age bracket is divorce. The ERC said the average age of divorce is on the rise.
And this has all had an impact on the number of equity release plans being taken out, with the ERC observing that as more over-65s live alone, the number of single equity release plans being taken out by customers has also increased.
Equity release enables homeowners aged 55 plus to draw a lump or regular sums from the value of their home, while remaining in their homes and without having to make monthly repayments.
‘Silver splitters’
Jim Boyd, chief executive officer of the ERC, has dubbed the increase in over-65s living alone as ‘the rise of the silver splitters’. He said: “There has been a dramatic increase in the number of single households lived in by pensioners.
“This is increasing as ever longer lives are spent alone in retirement following the death of a partner or where people have chosen not to marry.
“However, the rise of ‘sliver splitters’ in now becoming a striking feature of ageing-Britain leading to increases in the number of people living alone in later life.”
Women
Women were particularly vulnerable to financial shortfalls in retirement. Stephen Lowe, group communications director at Just Group, said it was interesting to note nearly double the number of new equity release plans were taken out by single women as single men in the first half of this year.
Of retirees in the lowest income groups, 45% were single women, 38% couples and 17% single men.
“Given the gap in pension provision between men and women, we foresee more growth in equity release advice driven by women seeking to supplement their incomes in later life, enabling them to stay in their homes and communities,” he said.
Meanwhile, Will Hale, CEO of equity release adviser Key, pointed out it was often women who bore the brunt of financial hardship following a relationship breakdown or death of a partner.
He said: “We find that for some people – particularly women – losing a partner can cause significant financial hardship as they find that their joint finances were not as healthy as they thought or they lose some of their pension provision due to their partners’ death.
“Equity release offers a solution for those who need support in retirement and our own figures suggest that in the last five years we have seen a 5% increase in single people taking our equity release.”
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To read this month’s Q&A or to submit your own query, click here.
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What happens if you divorce after equity release?
I am an executor for my late fathers will, they were divorced and tenants in common,is his beneficial interest safe or will it still get swallowed up my by ex step mothers life time mortgage?
Kind regards
P Hickman