Home sweet home
I READ Vic de Klerk’s response (18 September: “Rent before you retire”) to Tim Elliott’s question with interest. And while I don’t necessarily agree with his conclusion, I wholeheartedly agree with the general theme of his report – make sure your assets in retirement perform adequately in order to achieve your financial objectives.
In planning for retirement you should always work back from the financial outcomes that you want or need to achieve. What income must be generated and how will that be accomplished, relative to the expenses that must be met in retirement? If the benefits and associated costs of not selling your home in retirement have been factored into that equation and the answer is still OK, then it might not be necessary to do so. Having said that, if the equation isn’t giving the desired outcome, you would then need to consider a range of other alternatives.
I’m certainly not suggesting that home equity release is the perfect solution, nor am I suggesting it’s the only solution. However, it is one of many alternatives that people are able to consider as a means of accessing additional capital or income to meet their retirement needs or dreams, particularly if they wish to stay in their family homes during their golden years.