Can Equity Release Affect Means-Tested Benefits?

It can. A lifetime mortgage is borrowing, but once released money is held as cash or savings it can affect entitlement to some means-tested benefits depending on the benefit rules and your total capital.

Why the amount and timing matter

Taking a large lump sum and leaving it in a bank account may have a different benefit impact from taking smaller amounts as they are genuinely needed. This is one reason drawdown can be worth considering where suitable.

Check before completing

Benefit rules can change and individual circumstances matter. If you receive means-tested benefits, the likely effect should be checked before deciding how much to release or how to structure the borrowing.

Reviewed by David Farrell. Last reviewed: 3rd October 2026.