Canada Life routinely questions their prospective home finance customers to understand their reasons for obtaining an equity release loan.
Analysis of the 2025 full-year data shows a shift in the reasons why customers are choosing equity release, with a record number doing so for intergenerational gifting.
In 2025, 19% of those using equity release did so to gift money to family members - a 3% increase on the previous year, and the highest figure recorded in a decade of Canada Life’s customer data.
This upward trend underscores the increasing significance of intergenerational support, as older homeowners look to assist children and grandchildren with financial milestones such as house deposits and education fees.
Home adaptations or improvements2 emerged as the leading reason for using equity release in 2025, with 43% of applicants citing this when applying – a substantial 10% uplift on the previous year.
Whilst clearing an existing mortgage remained a key motivation, 2025 marked the first year where it was no longer the leading reason for taking out equity release, dropping from 36% in 2024 to 27% in 2025.
The data also highlighted a marked increase in the number of customers establishing an emergency fund - from 8% in 2024 to 21% in 2025. The rise points to heightened financial caution, with more customers prioritising a safety net against unexpected expenses, possibly in response to economic uncertainty or personal health concerns.
Sadna Zaman, Home Finance Proposition Manager, Canada Life comments on the findings:
“It’s clear from Canada Life’s data that equity release is increasingly supporting customers with a broader range of retirement ambitions and family needs. No longer regarded as a last resort, equity release is supporting customers to enhance their lifestyle and homes, build financial resilience, and support estate planning.
“The majority of customers citing home improvements as their primary reason for releasing equity highlights a growing desire to remain in and invest in their own homes. At the same time, more customers are incorporating equity release into their estate planning strategies, using property wealth to pass assets to the next generation in a timely and tax-efficient way. This is enabling families to support loved ones with major milestones, such as home purchases or education, while also potentially reducing inheritance tax liabilities.
“The range of uses for equity release underscores the importance of tailored, expert advice. Equity release may not be the solution for everyone, but advisers play a vital role in helping customers make informed, confident decisions about their financial futures in later life.”
