As the cost of living continues to rise, and with mortgage terms often stretching into later life, some over 50s are carrying debt well into retirement.
New research from SunLife’s Life Well Spent 2025 report reveals that nearly half (45%) of those aged over 50 are still managing debt, with the amount of overall debt left to pay averaging £23,799 – rising to an average of £33,590 for homeowners over 50.
Unsurprisingly, mortgage debt remains the biggest burden. Increasing rates and the cost of living mean many find themselves paying off their homes well into retirement, with an average balance of £67,538 and monthly repayments of £842. For some, that could mean delaying retirement or cutting back on spending just to keep up with payments.
Average debt still left to pay
As well as this, almost one in three (30%) over 50s have credit card debt (which amounts to £3,922 on average), one in ten (10%) hold personal loans (£5,793), a further 8% have overdrafts (£1,575), and 6% are managing rising car finance costs that now average £11,375 per borrower(£1,393 more than last year’s average).
Regionally, the financial pressure is felt the most in London and the Southeast, though the strain is being felt UK-wide. However, it’s not just their bank balance taking a hit, as more than half (56%) believe that clearing their debts would make them more content, proved by the fact that the majority of those who have done so (84%) report significantly increased happiness.
How equity release could help ease the burden
With 80% of over 50s now aware of equity release and 13% considering it, homeowners are seeing it as a way to boost their finances without selling up. The 2025 report finds that those who released equity unlocked an average of £69,982, with 36% using the funds to pay off debts and 44% to improve their homes. Importantly, three-quarters (76%) said it made them happier.
For many, equity release provides a route to clear long-standing debts, supplement income or support family, all while remaining in the home they love. The most popular form of equity release, a lifetime mortgage, is technically a loan, but usually requires no repayments until you pass away or move into long-term care. However, making ad hoc or regular repayments may be recommended to keep the cost of borrowing down, where affordable.
On average, homeowners who’d consider equity release have stated they would look to unlock around £81,000, most often to clear debts, boost income or help loved ones financially. Others would use the funds for home improvements or long-awaited life experiences such as travel and hobbies.
Mark Screeon, CEO at SunLife, comments: “Many over 50s have worked hard for decades yet still find themselves with some debt. The rising cost of living and ongoing financial commitments can make it hard to enjoy the retirement they’ve planned.
“For some homeowners, equity release could offer a practical and empowering way to unlock some of the money tied up in their property to pay off debts, support family or simply live more comfortably.
“At SunLife, we want people to feel confident about their financial future. For those who would like to explore equity release, a financial adviser will advise you as to whether it’s the right option for you and your specific circumstances.”
