The firm found that retirees are missing out on an average £232 each year – the equivalent of almost one month’s state pension – by not being aware of their benefit entitlement.
Of Just Retirement Solutions’ 1589 customers, 24 per cent were eligible to claim state benefits but had not done so and a further 3 per cent were not claiming enough.
Head of research Nigel Barlow says: “The lack of awareness surrounding state benefits is a real concern mainly due to the fact that information is not always readily available or easy to follow.
“Pensioners can considerably bolster their income by getting to grips with their entitlements. This would not only provide a welcome relief to those less well off but ensure that pensioners receive what is rightfully due to them.”
Safe Home Income Plans director general Andrea Rozario says: “It is disturbing that state benefit entitlement is so poorly understood but, as far as equity release is concerned, this highlights the importance of obtaining thorough advice from a properly qualified source.
“The advice service should include a review of the state benefits for customers, to ensure they make the most of what they have. This is why all SHIP members will only deal with advisers who are specifically qualified in equity release and have taken their clients through a fully advised process.”
But Key Retirement Solutions group director Dean Mirfin says: “Under FSA requirements, equity release advisers are only obliged to tell the customer that their state benefits could be affected and recommend that they seek further advice before proceeding, so not all advisers will themselves conduct a thorough analysis of how they might be affected.
“It is important that the client sees an adviser who can fully assess eligibility for benefits and what any impact will be.”