A growing proportion of people are not using a pension to save for their retirement, but are instead planning to downsize to a smaller property and use the cash to buy an income, suggests research by Royal London.
However, the provider said this could be very risky as its study also suggested this retirement strategy could cut a retiree's income by half. The study shows that, looking across the UK as a whole, downsizing from the average detached house - worth £310,000 - to the average semi-detached house - worth £197,000 - and using the difference to buy an annuity would leave the retiree with an annual income of £13,700. By contrast, full-time workers earn £27,400 a year on average. Other factors could also complicate this retirement strategy, according to the report. It said children are movi...
To continue reading this article...
Join Professional Adviser for free
Signup and gain exclusive members-only insights
- Unlimited access to real-time news, industry insights and market intelligence
- Stay ahead of the curve with spotlights on emerging trends and technologies
- Receive breaking news stories straight to your inbox in the daily newsletters
- Make smart business decisions with the latest developments in regulation, investing retirement and protection
- Members-only access to the editor’s weekly Friday commentary
- Be the first to hear about our events and awards programmes
