The base rate and equity release
Now the biggest news in the financial services authority at the moment is the monumentous decrease of the Bank of England base interest rate. It now stands at 1.5% and this is incredible as it is the lowest it has ever been. This is great news for those who are net debtors and those who have tracker mortgages as they have to pay back less each month. But what about those whose net personal balance sheet shows a positive sum? Well, this has serious repercussions as it all but eradicates the banks as a viable savings option; forcing risk-averse savers to incur more risk than they would like should they want to put their money to work.
As regards equity release, the Press Association expect the equity release providers to rethink their interest rates accordingly. Combine this factor with the pension fund instability and it is easy to see why equity release remains a growth sector in retirement planning.
