Life for those who have retired has become financially more difficult in recent times for a variety of reasons. Nowadays unless you have consistently contributed to a secondary pension scheme for the majority of your working life you won’t be seeing much of a return in those important twilight years.
Even though you’re supposed to be lying back and enjoying life work-free after you hit retirement age many amongst are having to keep working in order to make ends meet as our promised pensions have fallen short of our expectations and this, coupled with the rising cost of living, has meant that things just haven’t improved which has left some pensioners with no other choices.
Many retirees have had to cut corners and in more extreme cases have been forced to sell their own homes due to the financial constraints. In fact 42% of retired people who now rent their property are former homeowners themselves. A quarter of all retired people in the UK already rent, according to new research by Prudential, and it’s due to a culmination of financially driven issues that has affected this decision.
Complimentary research from Fast House Buyers Openpropertygroup.com found that 39% of retirees who sold their home did so due to financial constraints.
There are many financial strains that those looking to retire have to face. Whether its paying for unexpected health-related costs, attempting to clear debts, releasing pension funds so that it can be used to cover any unforeseen separation or divorce costs and fees or using savings and other income to pay for your children or grandchildren’s futures it can be an important source of money.
Therefore it’s more important than ever to be able to financially support yourself as well as your partner and family in the event of your retirement.
Switching to renting
For many homeowners the choice to switch to renting is a way in which to boost their current retirement income but it’s important to consider all the potential costs and other hidden fees that you may not initially be aware of when choosing to sell up and find a suitable home or property to rent in the future.
Many retirees should consider speaking with a financial adviser initially to help plan their finances and their situation before any major decisions are reached. An adviser will be able to help you plan and save and make sure that any unexpected costs are well covered. Professional guidance is recommended and even certain organisations like the Citizens’ Advice Bureau as well as the Money Advice Service will be able to provide free advice.
For the younger generation getting onto the property ladder has become a titanic struggle and many retirees have sold their property in order to help release some funds to assist in their children getting on that ladder and providing them with the money to cover a much needed deposit for their new home.
But what’s more troubling is that around 58% of retired renters in the UK have never actually owned their own home and the vast majority of them are happy to continue renting indefinitely.