An increasing number of older people are starting to down-size their homes.
They are down-grading the risk element in their investment portfolios and are reducing their investment levels – even if they are not yet drawing down savings. Baby boomers are turning into sun-downers. Yet, for all its cleverness, the UK financial services industry seems slow, if not to recognise, at least to address the important implications of this shift.
In 2012 British householders grew richer. A general market recovery pushed financial assets over the £7 trillion mark for the first time, with household wealth increasing by more than 60 per cent in the last ten years. The value of deposits, pensions and private portfolios has burgeoned. Happy days .........but what if we look deeper?
Analysis of the 2011 census reveals that the number of people turning 65 in that year alone had surged by 30 per cent. According to figures from the Office for National Statistics, 169,000 more people in England and Wales celebrated their 65th birthday that year than in the preceding twelve months. In a nutshell, there are more 65-year-olds in the UK than ever before and it is envisaged that the number will rise by 600,000 every year until 2018.
This should come as no surprise, bearing in mind the significant increase in the birth rate after the Second World War, dramatically improving life expectancy statistics and the existence of a much fitter and healthier older population. At a macro level the implications rippling through for housing policy, health and social care services are considerable; at the micro end, likely as not, there are personal shocks in store.
Research amongst those approaching retirement suggests that many retain wholly unrealistic expectations about the income stream that will be available to them post retirement.
Certainly, older people need to be able to access high-quality advice that addresses their housing, financial and care needs, but in particular, more people will be seeking clear guidance about how to make best use of all their resources – state benefits, pensions, savings & investments and for home owners, equity release.
Seasoned industry practitioners will recall the days in the ‘70s and 80’s when the weekend newspapers landed heavily on readers’ doormats. Building societies, banks, investment houses and insurers vied for copious advertising space, eager to display their products in a way that would appeal to the open cheque-books of the nation’s savers.
Dealing with the post at the beginning of the week was a major enterprise - as was the processing of many thousands of cheques, pinned, stapled and sticky-taped to flimsy newspaper coupons sent in by private individuals.
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