The Intermediary – February 2026 - Flipbook - Page 76
L AT E R L I F E L E N D I N G
Opinion
The equity
question facing
Baby Boomers
T
he first babies born
in post-war Britain
celebrated a milestone
birthday recently, as
the ‘Baby Boomer’
generation reached
80. Nine months on from Victory in
Europe (VE) Day on 8th May 1945, the
country’s birth rate started to surge.
This demographic phenomenon –
known as the ‘baby boom’ – resulted in
almost one million births in 1946.
Approximately 470,000 baby
boomers will mark their 80th
birthday this year, according to our
analysis. They join one of the UK’s
oldest and fastest growing cohorts; the
UK’s over-80 population is expected
to hit 4,934,490 in 2036 and reach
6,234,990 by 2046.
As living standards, medicine
and technology have improved, life
expectancy has grown. The most
recent official period life expectancy
data from the Office for National
Statistics (ONS), published December
2025, shows male life expectancy of 79
years at birth in the UK and 83 years
for women. Female life expectancy
at birth in 1946 was 69 years, while
men’s life expectancy was just
64 years.
There are now approximately 15,300
centenarians (people aged 100 years
and over) in England and Wales, a
number that has doubled from only
7,280 in 2003. In 1946, there were
fewer than 300 centenarians across
both countries.
While only 1.7% of the male
baby boomers who turn 80 this
year can expect to live to 100, 3.8%
of women can expect to live long
enough to receive a leer from
Buckingham Palace on their 100th
birthdays in 2046.
Since the Second World War,
the UK’s financial landscape has
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The Intermediary | February 2026
changed fundamentally. The average
UK house price was £1,459 in 1946
(approximately £53,503 in today’s
money) compared to £271,000 today.
The financial landscape has
changed a great deal, too. The UK State
Pension – officially the retirement
pension under the National Insurance
Act 1946 – was introduced in July
1948, so there was no contributory
State Pension in 1946 itself. But in
1948, a married couple’s State Pension
was £2 2s – around £66.86 in today’s
money. For people reaching State
Pension age on or aer 6th April 2016,
the full New State Pension is £230.25
per week – or £11,973 per year.
Pensioner poverty
Despite increased real-terms spending,
1.9 million pensioners still live
in poverty. Those aged 80 or over
are the most in need of care – yet
few have saved sufficient funds to
meet their care costs, and poverty
among pensioners continues to
affect a significant number of older
households. Almost four in every 10
future retirees (38%) are on track for a
retirement income below the Pensions
UK ‘minimum standard’.
This is one of the key drivers of the
equity release market, which grew
11% in 2025, according to our research,
while total annual lending increased
from £2.3bn in 2024, to £2.57bn in
2025. The astonishing growth rate
highlights the role housing wealth
is playing in supporting financial
resilience in later life. Indeed, Fairer
Finance expects that, by 2040, 51% of
UK households aged 60-plus will need
to use housing wealth to support their
retirement spending.
Equity release allows older
people to access the wealth in their
homes, without needing to sell or
move. Lifetime mortgages make
JIM BOYD
is CEO at the Equity
Release Council
up more than 99% of the market.
These mortgages let people borrow
against their homes without making
repayments unless they choose
to. The loan and interest are paid
when the customer dies or goes into
long-term care. Equity release is
proving increasingly vital to meeting
people’s social and economic needs.
Demographic and economic pressures
mean the demand is there – and it is
likely to grow.
This is being reinforced by product
design. Innovations from lenders
are making modern equity release
more secure and more aractive to
consumers. Modern products are
more flexible.
Growth driven by innovative supply
and demographic demand will be
supported by collaboration across the
later life lending sector and regulatory
engagement.
The Financial Conduct Authority
(FCA) is set to launch a focused later
life lending market study later this
year, examining how mortgages and
property-based solutions can beer
support consumers borrowing into
retirement.
Brokers need to be aware that this
is an important step, reflecting the
reality that borrowing in later life is
becoming more common and that the
market must continue to evolve to
deliver the right consumer outcomes.
That regulatory focus, combined
with collaboration and continued
product innovation, gives us
confidence in the sector’s long-term
direction. We have never had a beer
opportunity to bridge the retirement
later life funding gap. ●
