I am thinking about releasing equity from my home, but could this affect my eligibility for pension credit?
A Which? Money member
‘Potentially, as wealth affects your eligibility’
Hannah Heath, Which? money expert, says…
Equity release could affect your eligibility for pension credit, depending on how much you have saved and how much you receive from releasing equity.
Pension credit tops up your weekly income to £227.10 if you’re single or your joint weekly income to £346.60 if you have a partner (these rates are for the 2025-26 tax year). If you earn more than this, you likely won’t be eligible, unless you have a disability or are a carer.
However, it’s not just income (such as pensions) which can stop you getting pension credit.
Every £500 over £10,000 in savings counts as £1 income a week
If you have £10,000 or less in savings and investments this will not affect your pension credit but if you have more than this, every £500 over £10,000 counts as £1 income a week. For example, if you have £20,000 in savings, this counts as £20 a week.
While the proceeds from equity release are in your account, they could therefore reduce your eligibility for getting pension credit.
You’re required to take financial advice before using equity release, so the adviser should discuss its impact on benefits as part of this process.
Which? Money 1-to-1 guidance
Our team of money experts can answer your questions big and small, on topics from pensions to tax and savings to scams.
They’re impartial so they don’t give regulated financial advice or recommend particular products or providers – they’re here to support you and to help you make more confident financial decisions in these areas and more:
Which? Money members and their immediate family get unlimited access to 1-to-1 guidance sessions.
If you’re a Which? Money member, you can book an appointment online. If you’re not, you can find out more about membership.
