Does having a healthy savings pot invalidate your equity release application? Mark Gregory has some good news for a reader keen to gift some money to a family member
The Question
I am currently investigating equity release. I would like to help my son and daughter-in-law pay for their wedding and house deposit and I feel equity release would provide the best solution.
There is one thing which is holding me back, I’ve heard I will need to take advice first and that the adviser will look at my finances. I currently have around £40,000 tied up in savings. I wondered whether I would be obliged to use this for my son before being allowed to release equity.
I would much rather keep this money in my savings for emergencies as it is earning a good rate of interest. Plus, I wish to give my son a higher sum – around £100,000. Will this nest egg invalidate my equity release application?
Mark’s Answer
Hello, and thank you for your very relatable question- it’s one we hear often at Equity Release Supermarket.
Many of our customers want to help their children or grandchildren at pivotal times in life – whether it’s for a wedding, house deposit, or other milestone. It’s a natural instinct, especially if you’ve always seen the equity in your home as something that would eventually be passed down. Gifting some of this wealth earlier – while you’re here to see the impact – is becoming increasingly popular.
That said, it’s just as common to want to protect your own financial security, especially in later life. Many of our customers say, ‘I’m happy to make a gift, but I don’t want it to affect my savings or force me to make repayments’.
This is where proper advice becomes crucial. Speaking with a specialist adviser – like those at Equity Release Supermarket – ensures your circumstances are fully assessed, and you receive a tailored recommendation from the whole of the market.
Now, to your question directly: having £40,000 in savings will not disqualify you from equity release. Advisers should encourage you to consider using some savings if doing so reduces the cost of borrowing, as flexible lifetime mortgages often have higher interest rates than savings accounts pay. For example, it may be sensible to retain a savings buffer of around £20,000 for peace of mind and use the remainder to reduce the amount you need to borrow.
It’s also worth knowing that some plans offer a drawdown lifetime mortgage, which gives you access to additional funds in future, without paying interest on them until you need them. That flexibility can work well alongside keeping a savings pot intact.
Ultimately, if you still wish to keep your full £40,000 in savings, you can. It won’t prevent you from releasing equity, it just becomes part of the advice conversation to ensure the solution balances your gift-giving goals with your own financial wellbeing.
Our advice? Speak to one of our equity release specialists by calling 0800 802 1051 or starting your journey online with our smartER comparison tool. We’ll walk you through your options and help you make an informed decision that works for both you and your family, now and in the years to come.
You can connect with a fully qualified Equity Release Supermarket adviser here to explore all options together.
Meet our expert…
Mark Gregory, founder and CEO of Equity Release Supermarket, is here to answer your questions. Mark is an adviser himself with over 20 years equity release experience.
He launched Equity Release Supermarket 10 years ago and it has grown to become one of the UK’s leading equity release specialists.
Email kate.saines@emap.com to ask Mark a question
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