Lifetime Mortgages Verses Pension Pots


In the past year, the number of homeowners releasing equity from their home with a Lifetime Mortgage has greatly risen, with over 22,000 people using the value of their property to fund their golden years1. But why a Lifetime Mortgage?

Research has shown that some homeowners are releasing around 175% more cash than the average pension pot2. Not surprising when the average pension pot only produces around £6,0003 income each year. For those relying on their pensions to help them through retirement, they may often be short of cash when it comes to leisure purchases, day-to-day living costs, and unexpected expenses.

This highlights the pension pot’s declining ability to provide an adequate income for many homeowners and how your property could in fact become your pension plan instead, using a Lifetime Mortgage.

A Lifetime Mortgage is a loan that you take out against the value of your home. It is completely tax-free and is usually paid back at the sale of your home after you have passed away or moved into full-time care. You retain full home ownership and will never owe more than the value of your home.

Homeowners who chose a Drawdown plan; one of the options available with Lifetime Mortgages where you reserve funds that accrue no interest until withdrawn, released on average 85% more than their pension pot value, whereas those who chose a Lump Sum plan released an average 175% more.

If you feel that your pension is not enough to help you through retirement, consider a Lifetime Mortgage as an alternative.

Bear in mind that releasing equity from your home can affect your entitlement to means tested benefits and may leave less money in your inheritance.


1 – The Guardian

2 – Equity Release Council

3 This is Money




Responsible Equity Release is a trading style of Responsible Life Limited. Responsible Life Limited is authorised and regulated by the Financial Conduct Authority and is entered on the Financial Services Register ( under reference 610205. Only if you choose to proceed and your case completes will Responsible Life Limited charge an advice fee, currently not exceeding £1,490. A lifetime mortgage may affect the value of your estate and your entitlement to means-tested state benefits. Our adviser will talk you through this and the setting up costs before you make any decision to proceed.

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