Can Equity Release affect benefits?
Equity Release can affect means-tested benefits, as the released money may impact eligibility for certain benefits. The impact varies depending on the amount released and the specific benefit. Here’s a simple breakdown of how Equity Release can affect benefits:
- Universal Credit: Equity release can affect Universal Credit, as it is a means-tested benefit that considers income, savings, and capital when determining eligibility.
- Pension Credit: Equity release may affect Pension Credit, as it is a means-tested benefit that tops up the state benefit for pensioners with low incomes. The impact depends on the amount released and how it affects the individual’s overall financial situation.
- Council Tax Reduction: Equity release can also affect Council Tax Reduction, as it is a means-tested benefit based on income and savings.
- Disability Benefits and Personal Independence Payment (PIP): These benefits are not affected by equity release, as they are not means-tested benefits. Disability benefits are paid regardless of income or capital, and PIP helps with the extra costs of a long-term health condition or disability for people aged 16 and over.
It’s important to note that seeking professional financial advice is highly recommended when considering Equity Release, as experts can assess the specific situation, provide guidance on reporting changes to relevant authorities, and help understand the potential effects on various means-tested benefits.
As part of our partners standard advice process, we will use a simple benefit checking system and if it appears you might be eligible they will advise you to look into whether you do qualify for any benefits payments before proceeding further.
