More and more people are finding themselves underfunded when it comes to their retirement, what are you to do? Tap your home equity.
There are plenty of reasons as to why many people aren’t prepared financially for retirement. Our lifespans are increasing, Baby Boomers are retiring all at once forcing the pensions that helped previous generations to all but disappear, as well as many other reasons. Don’t press the panic button just yet. Many on the cusp of retirement do have one source of cash that could help them close the gap between what they have and what they’ll need to live well. It’s right under, above, in front, and behind their nose: their home! It’s called home equity. Here are three ways in which you can tap into your home equity to help you live well into retirement.
- Hello, HELOC
If you have enough money to cover your day-to-day needs, but no real cushion for unexpected expenses, a home equity line of credit (HELOC) can serve as your emergency fund. You’ll have to pay the only the interest on the amount you use during the draw period, but they’ll likely be higher than they are now. Be sure to pay off the debt before the adjustment hits.
- Sell & Move
This is likely the first thing you thought of. Many retirees sell their home and feel liberated from shedding all the unnecessary stuff and move into a smaller, more manageable place. You’ll lower your monthly expenses and boost your portfolio. The only con is that you have to go through the process of selling your home all over again: something you may not have experienced since before your children were indeed, just children.
Retirement is something that should be as stress-free as possible. For more information or help on how to pay off your mortgage, contact me, Andraya Coulter. I serve the Bay Area and the entire state of California and Texas with quality, suitable home loans!