Prospects for the Development of Equity Release Products in Poland – Reverse Mortgage from a Cultural Perspective

At the time of crisis, which involves state funded benefits as well as an increase in public debt, the members of the European Union are forced to consolidate their budgetary expenses. The social cost, however, is extremely high, as the general public is unwilling to accept it. Demographic experts predict a decrease in the amount of people at an economically productive age, not to mention the continuously growing life expectancy. This fact will have serious economic consequences in Poland. That is why the pension system reform was initiated. The inevitable cuts in spending on welfare benefits might cause a situation in which one of the possibilities of increasing retirement benefits leads to the use of the most valuable and long-lasting assets that can be found in households - real estate. A financial instrument called reverse mortgage enables the gradual liberalization of the value of real estate and, thereby, can be used as an additional source of retirement income.