Key Retirement Solutions has welcomed the upcoming government rule change for pensioner benefits, which will see many small savers getting an income boost.
Announced in this year’s Budget and effective from next month, the change will raise the "capital disregard" limit on pensioner savings from £6,000 to £10,000.
Effectively, this will mean that thousands of lower-income households will be able to claim more in Pension Credit.
However, Key Retirement Solutions pointed out that the number of pensioners who are able to unlock equity safely from their homes will also increase as a direct consequence of the reforms.
Dean Mirfin, group director, explained: "Typically the minimum advance from the more popular equity release providers is £10,000.
"This not only opens up more pensioners to the prospect of equity release but it does so in a way which will leave their entitlement to Pension Credit intact."
Government data suggest that pensioner incomes will be boosted by up to £8 per week as a result of the reforms.
Around half a million households are likely to be affected.
Mr Mirfin added: "Pensioners should be encouraged to release equity from their homes, not discouraged. This step by the Chancellor goes some way to benefitting those who would otherwise see a reduction in benefits as a result."
Posted by Tom Papworth
