The Association of IFAs (AIFA) has criticised consumer watchdog Which? after it hinted its report into the quality of equity release advice given by intermediaries will be far from glowing, reports IFA online.
Chairman John Gummer MP says Which? "talks as though IFAs behave badly naturally", adding he disapproves of its suggestion equity release should be a last resort.
It follows comments made today at a debate hosted by solicitor Eversheds and trade body Safe Home Income Plans (SHIP).
Speaking at the event, Which? spokesperson Teresa Fritz said the consumer body was in the process of conducting a mystery shopper exercise on a number of equity release advisers.
Although Fritz pointed out the study is still at an early stage, she admitted early results suggest a poor level of advice, with conduct of business rules ignored.
But Gummer hit back: "Which? talks as if we in the industry are a group of people that behave badly naturally.
"I do not like its statement equity release should be a last resort. It is an option that should be considered carefully. We do not want to frighten off people for whom this is the best option."
Gummer adds while intermediaries provide a good standard of advice, they cannot force clients to follow it.
Wednesday, April 29
Tuesday, April 21
Base Rate Collapse Cuts Pensioners’ Income By Nearly A Quarter
The slide of interest rates to historically low levels has seen more than 8 million pensioners’ monthly income fall by nearly 25% over the last 12 months, according to figures from SHIP (Safe Home Income Plans), the equity release trade body.
SHIP’s figures show that, in April 2008, the average pensioner received £158 per month from their savings. This was in addition to their pension and accounted for 28.62% of their total income.
The fall in base rate has seen that income slide to just £16 per month, or 4% of their total income.
With perhaps little chance of bases rates rising to last year’s levels soon, pensioners need to consider alternative sources of income. On such possibility for homeowners is equity release.
Equity release can offer a real solution to pensioners’ problems. For example, a 75 year old woman with a property worth £300,000 could release up to £900 per month for 15 years. This would more than cover her loss of income.
“One solution for those pensioners needing to boost their income is equity release. The over 60s can release some of the wealth tied up in their property and increase their retirement income substantially should they wish” said Andrea Rozario, Director-General of SHIP.
SHIP’s figures show that, in April 2008, the average pensioner received £158 per month from their savings. This was in addition to their pension and accounted for 28.62% of their total income.
The fall in base rate has seen that income slide to just £16 per month, or 4% of their total income.
With perhaps little chance of bases rates rising to last year’s levels soon, pensioners need to consider alternative sources of income. On such possibility for homeowners is equity release.
Equity release can offer a real solution to pensioners’ problems. For example, a 75 year old woman with a property worth £300,000 could release up to £900 per month for 15 years. This would more than cover her loss of income.
“One solution for those pensioners needing to boost their income is equity release. The over 60s can release some of the wealth tied up in their property and increase their retirement income substantially should they wish” said Andrea Rozario, Director-General of SHIP.
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