Almost half of people over 50 still managing debt

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Meeting the challenge of later life debt

Managing money in later life remains a challenge for many people. New research shows just how common debt has become among those heading towards or already in retirement. 

According to SunLife’s latest Life Well Spent 2025 report, 45% of over-50s are still juggling some form of debt. The average amount owed by over-50s is £23,799 – rising to £33,590 for homeowners.

Is equity release the answer for debt in later life?

As financial pressures continue, many homeowners in their fifties and older are using the wealth tied up in their home to help. As well as remortgaging or downsizing, one way to do this is through equity release. 

Higher interest rates and inflation have added extra pressure to household budgets, and that is reflected in some industry data. As an example, one leading equity release advice firm says that in the first quarter of 2025, 63% of its customers used equity release to repay their mortgage, compared with just 36% in the second quarter of 2024. 

The same data source shows the average initial withdrawal by lifetime mortgage customers in the first quarter of 2025 was £62,930, a 13% rise and the first increase in three years. London customers accessed higher amounts, averaging £145,471.

As well as clearing debt, reasons that people are using equity release include gifting, with 9% of customers using funds to support children or grandchildren. There was also an increase from 3.2% to 7.5% of people releasing funds to pay for holidays.

Some figures recently released by SunLife further illustrate the awareness and use of equity release. SunLife found that 80% of people aged over 50 are aware of equity release – and that 13% are considering it as a way to generate cash without selling their home.

The Equity Release Council reports that total lending reached £639 million in the third quarter of 2025, up 4% on the same period last year.

How does equity release work as a way to clear debt?

A lifetime mortgage is the most popular type of equity release plan. Available from age 55, it lets you access tax-free cash through a loan secured against your home, with no need to make regular repayments. The loan and interest are usually repaid through the sale of the property when you pass away or move into long-term care.

Any money left over after paying off the loan and interest will go to your beneficiaries. Some plans let you ring-fence part of the value of your property to ensure an inheritance for your loved ones. However, equity release will typically reduce the size of your estate. 

Always weigh up the pros and cons of equity release carefully, and get specialist advice to ensure it’s right for you, and that you choose the plan that best fits your unique goals and circumstances.

Our selected advisers can help you understand all of the benefits and drawbacks and explore whether equity release may be suitable for you. Call us on 0808 178 3055 or request a call back to arrange an appointment.