Equity release inheritance impact index

Name: Equity release inheritance impact index
Creator: Richard Parker

The single most common question about equity release is what it leaves behind. With a lifetime mortgage, interest is usually not paid month to month, it rolls up and is added to the balance, which is then repaid from the estate when the home is sold. This index gives a clear reference number for how much a typical release reduces an estate over time, with every assumption stated openly.

Worked headline. A £80,000 release that rolls up for 20 years at an assumed 6.90% would grow to about £303,839. That is the amount repaid from the estate, roughly 3.8 times the original sum. The figure is an illustration of compounding, not a forecast.

Assumptions, stated. Roll-up rate 6.90% per year, fixed for the term (a typical published lifetime mortgage range as at June 2026). No voluntary repayments. Interest compounds annually. The reference release of £123,174 is the Equity Release Council reported average new lump-sum release, to confirm against the latest market report. These are illustrative assumptions, not an offer or a prediction.

Reduction by release size and term

The rolled-up balance repaid from the estate, by how much is released and how long it rolls up:

Rolled-up equity release balance by release size and term
Amount released	After 10 years	After 15 years	After 20 years	After 25 years
£50,000	£97,442	£136,030	£189,900	£265,102
£80,000	£155,908	£217,648	£303,839	£424,163
£123,174	£240,047	£335,108	£467,814	£653,073
£150,000	£292,327	£408,091	£569,699	£795,305

Source: Compound roll-up at an assumed 6.90% per year, no repayments. Illustrative. June 2026

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| Amount released | After 10 years | After 15 years | After 20 years | After 25 years |
| --- | --- | --- | --- | --- |
| £50,000 | £97,442 | £136,030 | £189,900 | £265,102 |
| £80,000 | £155,908 | £217,648 | £303,839 | £424,163 |
| £123,174 | £240,047 | £335,108 | £467,814 | £653,073 |
| £150,000 | £292,327 | £408,091 | £569,699 | £795,305 |

Source: Compound roll-up at an assumed 6.90% per year, no repayments. Illustrative. June 2026

Reduction by age at outset

A release taken younger has longer to roll up, so the impact on the estate is larger. Using the reference release of £123,174 and an illustrative term per age band:

Rolled-up balance by age at outset, reference release
Age at outset	Illustrative term	Amount released	Balance repaid from estate	Note
65	25 years	£123,174	£653,073	longer expected term
70	20 years	£123,174	£467,814	illustrative term
75	15 years	£123,174	£335,108	illustrative term
80	10 years	£123,174	£240,047	shorter expected term

Source: Reference release £123,174 (ERC average, to confirm). Roll-up 6.90% per year. Terms illustrative, not life-expectancy forecasts. June 2026

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| Age at outset | Illustrative term | Amount released | Balance repaid from estate | Note |
| --- | --- | --- | --- | --- |
| 65 | 25 years | £123,174 | £653,073 | longer expected term |
| 70 | 20 years | £123,174 | £467,814 | illustrative term |
| 75 | 15 years | £123,174 | £335,108 | illustrative term |
| 80 | 10 years | £123,174 | £240,047 | shorter expected term |

Source: Reference release £123,174 (ERC average, to confirm). Roll-up 6.90% per year. Terms illustrative, not life-expectancy forecasts. June 2026

How this is measured

Each balance is a compound roll-up of the amount released at the stated annual rate over the stated number of years, with no voluntary repayments and interest compounding once a year. This is the standard way lifetime mortgage interest accrues when nothing is paid month to month. The reference release figure is the Equity Release Council reported average new lump-sum release, and is to be confirmed against the latest Council market report.

Sources to confirm: Equity Release Council market reports for the average release figure (equityreleasecouncil.com); published lifetime mortgage rate ranges for the roll-up rate. The rate and term assumptions are illustrative and labelled throughout. Actual outcomes depend on the real interest rate, any repayments made, how long the plan runs and house price movements. Figures reviewed and to be signed off by Richard Parker, June 2026.