Later life lending - a type of equity release - has the potential to become the fourth pillar in retirement, according to the FCA.
Housing wealth will become an increasing part of how people provide for their retirement.
Advisers need to move, “from product-led conversations to genuinely holistic ones,” according to Emad Aladhal, director of retail banking at the FCA.
In a speech to the Later Life Lending Summit this week he said: “The market is in silos – set up for mortgages, pensions, investments and later life planning to play in different parts of the pitch. Advisers often don’t consider the full journey. Or most importantly, work together to achieve a holistic good outcome for the consumer.
“But consumers do not live their lives in silos. We want to see advice that supports informed, confident decision-making across all available options. That means advisers looking across the whole consumer journey, not just part of the market.”
He added that while advisers have the expertise to guide customers, providers need to work with the regulator to consider how best to consider better outcomes at scale.
The FCA is currently conducting a market study on the later life mortgage market looking at how it is meeting needs, how customers move through the market, and where the current system may be falling short.
The regulator plans on sharing the results of this study and, “pushing forward changes identified,” by the end of this year.
Total annual lending in the equity release market grew by 11% to £2.57bn in 2025 (224: £2.3bn), according to the latest figures from the Equity Release Council (ERC).
Lifetime mortgages continued to dominate the market, making up over 99% of the market.
The Council claims that equity release now supports around £1 in every £90 spent by retired households.
Advisers expect the market to continue to grow, with over 80% saying they expected more lending in 2026 than in 2025.