Martin Lewis' Thoughts on Equity Release in 2024

Martin Lewis suggests equity release might suit those over 55 seeking income boosts without prioritizing inheritance. He warns of high compound interest costs, advising property downsizing as a preferable cash-raising strategy.
  • Last Updated: 12 Jun 2024
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What Is the Martin Lewis Guide to Equity Release? Discover the Fees, Interest Rates and Martin Lewis' Top Equity Release Tips. Read On...
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Key Takeaways
  • Martin Lewis advises caution with equity release, highlighting alternatives like downsizing or exploring other forms of borrowing.
  • He suggests consulting a financial advisor to understand the impact on inheritance and state benefits.
  • Lewis recommends considering overpayments on existing mortgages or loans as a potential alternative to equity release.
  • He emphasises the importance of understanding the long-term financial implications, including interest accumulation and debt.
  • Martin points to lifetime mortgages and home reversion plans, advising thorough research and comparison of these options against personal financial goals.

Martin Lewis recommends careful consideration of equity release in 2024, particularly highlighting the long-term costs and implications for inheritance, and advises homeowners to fully understand the commitment they are making.

He suggests alternatives like downsizing as financially safer options, emphasising the need for tailored advice. Lewis’s guidance reflects his expertise in personal finance, aiming to protect consumers from potential pitfalls.

In This Article, You Will Discover:

    In 2024, the stakes for equity release are higher than ever. Martin Lewis offers a critical examination, balancing the allure of financial freedom against hidden risks.

    Discover why Martin’s perspective on equity release in 2024 is indispensable for anyone considering this path. His expertise paves the way to a secure financial future.

    For his view on equity release; read on:

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    Martin Lewis Home Equity Advice

    NOTEEvery Investor is an impartial and unconnected third-party information provider via this website, and the details replicated in this commentary represent the opinions of Every Investor only and may not reflect the views or opinions of Martin Lewis. This article must not be interpreted as advice, nor is it a solicitation to conduct transactions in any financial product provided by Martin Lewis.

    Who is Martin Lewis?

    Martin Lewis is an award-winning financial journalist, broadcaster, and newspaper columnist, and he’s also the founder of the well-known website, MoneySavingExpert, which provides advice and tips on personal finance matters.

    Martin is highly regarded for his expertise in money-saving techniques, consumer rights, and financial education. The Guardian referred to him as ‘The most trusted man in the UK’ in 2019.1

    Born in Manchester in 1972, Lewis set up the MoneySavingExpert website in his living room for £80.2 Martin sold the website to MoneySupermarket.com in September 2012 for £87mln.3

    In 2019, The Guardian reported that MoneySupermarket.com was included in the top 100 sites in the UK and, at the time, had over 16mln visitors every month.4 

    What Is Martin Lewis’ Opinion on Equity Release and Lifetime Mortgages?

    Martin Lewis’ opinion on equity release and lifetime mortgages suggests caution, as he sees these as significant decisions requiring careful consideration of their long-term impact on finances and inheritance. He highlights that while they can offer immediate financial relief, they must be aware of their high costs.

    He strongly advocates considering downsizing as the most straightforward strategy to access home equity, positioning it as a more cost-effective alternative to the often expensive equity release options.

    His opinions on equity release and lifetime mortgages reveal that these can be good but expensive ways to access money to help you live a better retirement.5 

    He acknowledges that equity release can be a plausible option for older individuals who are asset-rich but cash-poor. 

    Lifetime mortgages and home reversion plans can affect the inheritance you leave behind for your loved ones. 

    Therefore: 

    He emphasises the importance of seeking professional equity release advice before releasing equity from your property. 

    Despite this, he advises people to be a little selfish and use the money to live a comfortable retirement rather than stress about the financial impact it may have on their inheritance.

    Learn about the equity release pros and cons in the United Kingdom, and make an informed decision about your financial future.

    What is Equity Release?

    Equity release is a financial opportunity that allows individuals to draw value from their homes, converting it into cash, without the need to sell the property. 

    Equity release typically requires homeowners to be at least 55 years old to be eligible for such financial products.

    This offers a means to financially leverage your home by releasing money from it.

    When engaging in an equity release transaction, you may also need to budget for equity release solicitor fees to ensure a legally sound process.

    Individuals often use an equity release calculator in the UK to estimate the funds they can unlock from their property.

    What are the Legal Implications of Equity Release?

    The legal implications of equity release include your property ownership rights and inheritance plans being affected.

    It is advisable to seek professional legal advice to ensure you fully comprehend the legal ramifications before proceeding.

    Before making a decision, it’s essential to consider the different equity release options available in the market.

    Uncover tailored solutions for equity release in Northern Ireland, meeting the unique financial needs of the region.

    What Are Martin Lewis’ Guides to Equity Release and Lifetime Mortgages?

    Martin Lewis’ guides to equity release and lifetime mortgages emphasise informed decision-making, exploring all alternatives, and understanding the long-term impact on finances and inheritance before proceeding.

    What is the Martin Lewis Guide to Equity Release?

    The Martin Lewis Guide to Equity Release is a comprehensive resource designed to provide clear, expert advice on the topic of equity release.

    The guide addresses a range of subject matter, including the pros and cons, cost implications, and alternative options.

    It succinctly explains complex financial jargon, ensuring readers fully comprehend this route of accessing cash tied up in their property.

    What sets this guide apart is Martin Lewis’ renowned reputation as a financial guru.

    His guide provides objective, trustworthy insights, thus equipping homeowners with the knowledge to make informed decisions.

    We appreciate that equity release is a significant decision, and this guide serves as an invaluable tool in the decision-making process.

    What Are His Top Equity Release Advice and Insights?

    His top equity release advice and insights include only borrowing what you need, using Equity Release Council members, getting professional advice, and being aware of the effect on your benefits.

    Here’s what else he has to say about these tips: 

    He Suggests Only Borrowing What You Need in Equity Release

    Martin Lewis suggests only borrowing the amount you need in equity release and waiting as long as you can before borrowing any money at all; this is his first and most important tip.

    The longer the loan term, the more you will have to pay back due to the compound interest that accrues every month. 

    For example

    Rather than taking a lump sum of £50,000 to spend over ten years, take out smaller amounts of £5,000 every year for ten years. 

    Interest is added as a percentage of the principal loan; therefore, the interest charged on a £5,000 loan is much less than that charged on a £50,000 loan. 

    Borrowing only what you need can help minimise interest costs and potential negative impacts on inheritance.

    *These figures are used for illustration purposes only. 

    He Recommends Choosing Equity Release Council Members

    Martin Lewis recommends choosing Equity Release Council (ERC) members for all of your equity release needs.6

    Members are required to provide a no-negative equity guarantee for all of their plans in accordance with the ERC rules.

    This guarantee means that you, or your estate, will never owe more than what your property is worth, regardless of the interest that has compounded over the term of your loan.

    He Suggests Getting Professional Equity Release Advice

    Martin Lewis suggests getting professional equity release advice from an independent financial advisor or mortgage broker before making any decisions. 

    An ERC member who specialises in the whole equity release market will be able to provide you with unbiased and honest advice on the best product for your needs.

    Professional equity release advisors can assess your individual circumstances, explain the options available to you, and guide you through the whole equity release process.

    He Warns of the Impact of Equity Release on Benefits

    Martin Lewis warns of the impact of equity release on the benefits releasing cash from your home could have. A sudden influx of a cash lump sum into your bank account could disqualify you from receiving means-tested benefits.7  

    Your equity release advisor will determine the best way forward in this regard.

    How Does Equity Release Impact Inheritance Planning?

    Equity release impacts inheritance planning by reducing the value of your estate, directly affecting the amount you can leave as an inheritance.

    The loan and its interest accumulate over time, diminishing the assets available for your beneficiaries. When you engage in equity release, it’s crucial to factor in how this decision will decrease the legacy you plan to leave behind.

    While it offers immediate financial benefits, the long-term consequence is a smaller inheritance for your heirs, altering your intended estate distribution.

    What Are the Alternatives to Equity Release and Public Opinions on It?

    The alternatives to equity release include downsizing, using savings, or taking out a personal loan, with public opinions varying from viewing it as a useful financial tool to concerns over its impact on inheritance and long-term costs.

    Does Martin Lewis Believe Downsizing Is Better Than Equity Release?

    Yes, Martin does believe that downsizing is better than equity release and advises retirees to explore this option before committing to a lifetime mortgage or a home reversion plan. 

    Downsizing to a smaller home could potentially generate the cash you need to live a comfortable retirement. Not only could the sale of your home earn you some cash, but your ongoing living expenses could be reduced by moving to a smaller, more manageable home.  

    He encourages those who are considering downsizing to do so sooner rather than later.  

    Here is why:

    He often encounters people who put off moving to a smaller house because they feel they are too young, until eventually it is too late and they are simply too old to handle the stresses of moving. 

    If, however, the cost of downsizing is prohibitive due to estate agent fees and relocation costs, then equity release could be the next best option.

    What Alternative Retirement Financing Options Exist?

    Alternative retirement financing options that exist include downsizing, personal savings, annuities, or personal loans, offering diverse ways to secure financial stability without tapping into home equity.

    Each option offers unique benefits and risks, tailored to different financial situations and goals. Innovative retirement financing includes peer-to-peer lending, crowdfunding, and even cryptocurrency investments.

    These modern approaches provide alternative avenues for generating income or capital growth, appealing to those seeking non-traditional retirement strategies.

    Understanding these options requires a keen insight into the current financial landscape and emerging trends.

    Customer Opinions on Martin Lewis and Equity Release

    Customer opinions on Martin Lewis and equity release often reflect an appreciation for his pragmatic advice, emphasising thorough research and cautious consideration before engaging with equity release schemes.

    What equity release customers think can be seen in their responses on consumer review websites such as TrustPilot, Review Centre, and SmartMoneyPeople.

    Some reviews:

    Complaints or Comments

    For any complaints or comments on MoneySavingExpert, you can email furtherhelp@moneysavingexpert.com.

    What Consumer Protection Measures Govern Equity Release?

    Consumer protection measures governing equity release include Financial Conduct Authority regulations, compulsory independent legal advice, and the no-negative-equity guarantee.

    These protections include clear advice requirements, transparent product details, and the right to reside in the property for life.

    Lenders must also be members of the Equity Release Council, which imposes additional consumer safeguards like a no-negative equity guarantee.

    The no-negative equity guarantee is a pivotal consumer protection within equity release, ensuring that borrowers or their estates will never owe more than the value of their home.

    Additionally, the Equity Release Council mandates that consumers receive independent legal advice before finalising an equity release plan.

    This ensures that all parties fully understand the terms and implications, providing a layer of security and promoting informed decision-making in the equity release process.

    How We Analysed Martin Lewis’ Views on Equity Release

    We analysed Martin Lewis’ view on equity release by gathering information from various reputable UK websites. 

    Our sources included the official MoneySavingExpert website, trusted news outlets, and well-established financial publications.

    NOTE: This article is an unaffiliated, independent, third-party, review of Martin Lewis or MoneySavingExpert.com.

    Contact Information for Martin Lewis

    The contact information for Martin Lewis includes visiting the MoneySavingExpert.com website for various contact options, including media inquiries and personal finance advice, reflecting his commitment to consumer financial education.

    Contact Number

    The contact number is 0800 030 4044 on the This Morning Show. 

    You can also send an email to: thismorning@itv.com.

    Common Questions

    Does Martin Lewis Recommend Equity Release?

    What Are Martin Lewis's Essential Tips for Choosing Equity Release?

    Has Martin Lewis Commented on the Risks of Equity Release?

    What Are Martin Lewis's Thoughts on Equity Release Interest Rates?

    Is Martin Lewis a Member of the Equity Release Council?

    Does Martin Lewis and Money Saving Expert Have Any Job Openings Available?

    Does Martin Lewis Offer Any Advice on Choosing an Equity Release Advisor?

    How Often Does Martin Lewis Update His Advice on Equity Release?

    What Does Martin Lewis Say About the Role of the Equity Release Council?

    Does Martin Lewis Agree With Equity Release?

    Final Thoughts

    As a respected financial journalist and consumer champion, Lewis acknowledges the potential benefits of equity release. 

    He does, however, emphasise the importance of careful consideration, professional advice, and exploring alternatives like downsizing.  

    When it comes to equity release, Martin Lewis is a firm believer in prioritising your own standard of living instead of worrying too much about what you will be leaving behind for your loved ones.

    A knowledgeable equity release financial advisor can guide you through the complex process of unlocking the value in your home.

    The features mentioned and the amounts raised, are subject to the lender’s criteria, terms and conditions. These may take into account the age, health and lifestyle factors in order to provide an enhanced amount. To understand the features and risks, ask for a personalised illustration.

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