Millions are petrified their ­quality of life will be sent into freefall with 15% admitting the biggest mental strain ahead of packing up work is funding their retirement.

Some 21% will have paid off their mortgage yet admit pension payments will not provide enough for a fulfilling life.

A report by Senior Capital, a later-life lending specialist, shows that amid the cost-of-living crisis around 20% will find themselves on the poverty line due to a lack of cash in their retirement pots.

Millions are looking to unlock money tied up in bricks and ­mortar to help themselves and loved ones – a move known as equity release.

Due to a surge in house prices over the past 50 years, hundreds of thousands of pensioners have a significant amount of capital wealth but feel they are unable to access this in order to pay for their retirement in the present.

In the early 1970s, the average house price was £4,975, but latest figures revealed that figure had rocketed to £290,000.

Rudy Khaitan, Senior Capital managing partner, said: “There is a growing need for new products that offer greater flexibility and choice, particularly in the relatively underserved later life lending market.”

There are now 16 million people over the age of 60 across the UK – one fifth of the population. Over-85s are set to double in number to 2.6 million in the next 20 years.

One in seven pensioners now say their biggest mental health issue is worrying about money during their retirement.

Subsequent research highlights why so many of Britain’s retirees are so concerned – with 22% already reducing or stopping spending on medication and 15% skipping meals because of their financial situation.

Even for those who are more fortunate, Senior Capital’s data shows that 21% admit that, despite paying off their mortgages in full, they were still unable to live fulfilling lives due to not having enough money. As experts forecast that a fresh wave of pensioners will find themselves living on the poverty line, equity release loans have experienced a record 23% year-on-year increase.

According to the Equity Release Council, more than 93,000 Britons took out this type of plan last year.

The cash crisis comes as more than 3.5 million people aged 50 to 64 are currently classified as “economically inactive”.

An analysis by charity Age UK suggests that of these 1.3 million are sick and 500,000 are caring for ­family at home.

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