More and more people of retirement age are returning to renting in a bid to boost their finances later in life.
Research by retirement and insurance firm Prudential has found that 42% of retired renters are former homeowners who’ve sold their property.
This is despite the fact that mortgage repayments are, on average, a smaller monthly cost than rental payments.
Yet things like debts, mounting living costs and the rising cost of retirement has prompted more older people to boost their retirement finances by selling their home.
Around a quarter of people in retirement are currently living in the private rented sector – a figure that’s set to increase in the coming months and years.
“Renting in retirement can make financial sense and accessing property wealth to boost retirement income is a genuine solution for many,” said Stan Russell, a retirement expert at Prudential.
“Our research shows that many retired renters are perfectly happy with this arrangement,” he added.
Of those who had sold their property in favour of renting, 9% said it was to boost their retirement income while 19% said it was to cover the cost of a divorce or separation.
The main reason given for selling up was for paying off any outstanding debts, with 40% of retired tenants giving this as a reason.
Despite many older people almost being forced into renting, 15% said the decision was a lifestyle choice. Three quarters of those surveyed said they expect to rent for the foreseeable future.
“I would urge everyone in the run up to retirement to speak with a financial adviser to help them plan and save for the income they’ll need to cover their costs when they stop working,” Mr Russell stated.
If you are currently living in the private rented sector and are struggling with your finances, a sudden money emergency can be a real issue. Personal loans are available to give you access to the funds you may require. Of course, no such loan should be taken lightly, and as with any form of borrowing it is important that you are able to meet repayments.