If you’ve been feeling the pinch lately then there’s a good reason why. The cost of living has been bumped up by food and energy price hikes, with inflation hitting its highest level in nearly five years in May.
Following May’s high of 2.9%, the Consumer Price Index (CPI) measure of inflation did drop slightly to 2.6% in July*, although the Bank of England has predicted inflation will peak at 3% by autumn**.
Economists have warned that this could just be the beginning, as energy price hikes and rising food costs will see the squeeze on living standards tighten. The rises could be especially noticeable by those of us in retirement, who typically use more energy and get by on a smaller income than people of working age.
Package holidays rise in cost
Unfortunately for anyone planning a getaway, the cost of package holidays saw one of the biggest leaps in the recent price increases, increasing by 0.6% between April and May. The rise has been attributed to other currencies gaining strength against the pound following the collapse of the sterling since Brexit.
In a further blow for jetsetters, experts have predicted that prices of package holidays could jump by 9 per cent next year. According to financial website Thisismoney.co.uk, large travel firms are already marking up prices for next summer.
The hikes come as major currency contracts start to expire, which until now have protected companies and their customers from the currency shocks following Brexit.
Property price boom
If you’ve been feeling the pinch lately, or haven’t been able to do as much in retirement as you’d planned to, then why not consider unlocking a cash lump sum from your home to boost your finances?
By unlocking a percentage of your home’s value, you could afford to take more holidays, make any home improvements your property needs, assist your loved ones financially or simply enjoy having a bigger disposable income every month.
The cost of living may be increasing but the good news is that house prices have been steadily rising for years. If you have owned your own home for a few years now, it could be worth thousands of pounds more than when you bought it.
According to the Nationwide House Price Index, the average home was worth £181,810 just 10 years ago in 2007. Today, it is worth £209,971, that’s £28,161 more equity.
Why arrange a lifetime mortgage?
Calculate how much equity I could unlock
Downsizing to free up some of your equity can be stressful and upsetting, especially if you don’t actually want to move away from the home you love.
With a lifetime mortgage, however, you can:
- Unlock some of your equity from your home’s value
- Spend the money in any way you choose
- Still own 100% of your property
- Never have to make any monthly repayments on the loan
- Repay the loan plus interest in full when your plan comes to an end (usually when you pass away or move into long-term care)
Speaking to an independent specialist is essential if you are considering equity release. A plan will reduce the value of your estate and the amount of inheritance you will leave, so it’s vital you understand all the advantages and disadvantages before making a decision.
For a free, no-obligation initial home appointment or to request your free guide to equity release, please call our friendly UK-based team today on 0800 411 8668.
*Express 13th August 2017
**Financial Times 15th August 2017