Pension Health Check: Why Your Home Could Be the Missing Piece of Your Retirement Plan

The pension health check proposal

Over 70 million pension records are now connected to the government's Pensions Dashboards, giving savers — for the first time — a consolidated view of their pension savings across multiple schemes and providers. For many people approaching retirement, this will be the first time they have seen a single, complete number. For a significant proportion, it will be lower than they hoped.

Industry figures, including Clive Bolton writing in Money Marketing, have called for the introduction of a routine statutory Pension Health Check — a formal, regular review that would help savers understand whether their pension provision is on track and what action, if any, is needed. The Pensions Commission's findings confirm that millions of UK workers are under-saving, and that the scale of the shortfall is not yet fully understood by those most affected.

M&G research adds further texture to the picture: around 75% of working-age adults lack a clear sense of how much they will need in retirement. Without a benchmark, it is difficult to know whether current savings are sufficient — or whether the gap is bridgeable with existing assets. That is the context in which a Pension Health Check would operate, and in which property wealth becomes relevant.

The property wealth picture

For homeowners aged 55 and over in England, housing is almost always the largest single asset. Total residential property wealth held by over-60s stands at approximately £2.92 trillion — around three times the total market value of all defined contribution pension assets (£950 billion). Most over-55 homeowners own their property outright or with only a small remaining mortgage balance.

The average UK house price in Q1 2026 was £305,092. For someone who bought their home 20 or 30 years ago, the equity accumulated is likely to be substantial — often exceeding their pension pot by a significant margin. Yet in most retirement income planning conversations, property is treated as a passive background asset rather than an active source of retirement funding.

The result is a structural mismatch: the largest asset many homeowners hold is the one least likely to be discussed in a pension review. A complete retirement income plan should include both.

How equity release fits alongside a pension review

A lifetime mortgage or retirement interest-only mortgage can complement pension drawdown in several practical ways. The key is that they address different aspects of retirement income.

• Supplement pension drawdown: A tax-free lump sum or flexible drawdown facility from a lifetime mortgage could release funds during the early years of retirement — reducing the rate at which pension assets are drawn down and allowing the pension to remain invested for longer.
• No monthly repayments required on a lifetime mortgage: Interest rolls up and is added to the outstanding balance. This suits retirees whose income is fixed or variable and who do not want to commit to regular outgoings.
• FCA regulation and Equity Release Council safeguards: All equity release products are subject to FCA-regulated advice. The Equity Release Council's standards require a no-negative-equity guarantee, a right to remain in the property for life, and independent legal advice before completion.

It is important to be clear about what equity release is not. It is not a replacement for a pension — it is a complement. The decision to use property wealth alongside pension savings is a complex one with significant long-term implications for income, estate planning, and means-tested benefit entitlement. Seeking regulated financial advice on both simultaneously — from advisers who understand the interaction between pension drawdown and equity release — is essential. There is no obligation to proceed at any stage, and the right answer will be different for every individual.

See also: retirement income planning guides and lifetime mortgage case studies.

IHT and inheritance considerations

Combining pension drawdown changes with equity release has estate planning implications that deserve careful attention. From April 2027, unspent pension pots will be brought within the scope of inheritance tax, which changes the relative attractiveness of drawing down pension assets versus preserving them. For some homeowners, using property equity to fund retirement income — while leaving the pension pot to grow and potentially pass to beneficiaries — could form part of a broader estate planning strategy.

The interaction is not straightforward. An equity release loan will reduce the net equity remaining in the property, which affects the value of the estate. The precise IHT and inheritance implications will depend on the size of the loan, the property value at the time of death, and the overall estate position. This is not territory to navigate without FCA-regulated advice.

Verity Home advisers work as part of a coordinated advice approach. Where estate planning or pension-related considerations are significant, we will help ensure that your broader adviser relationships — including any pension adviser — are part of the conversation. The goal is a plan that fits your complete financial picture, not an isolated product recommendation.