IFAs are still failing to consider a client’s property as an asset that can be used to boost retirement income and benefit from tax advantages, says Key Retirement Solutions.
The equity-release broker is calling on pension advisers to use equity release as part of their retirement planning proposition. Business development director Dean Mirfin says: “IFAs have got to see their clients’ homes as assets and use those assets as part of the whole retirement plan.”
Mirfin says by advising clients to take a lump sum out of a home through equity release, IFAs can then help clients boost their pension pot, earning them lucrative tax breaks and potentially doubling the size of the pension.
He says: “The average UK pension pot is around £30,000 but the average equity-release product is around £54,000. This means clients have the potential to increase their pension by a sizeable amount.”
Although Mirfin is keen to see the growth of equity release, he warns that advisers should not rush into offering equity-release advice without expertise.
He says: “There is a good living to be made in referrals, which will give advisers time to find good customers and take time in offering a whole advice proposition because investing in equity release will not only sap precious capital but it will also sap focus away from your core business.”