Description
With escalating cost of living pressures, retirees are turning to the untapped equity in their homes to compensate for their lack of income. This piece explores the pros and cons of accessing this equity through reverse mortgages and equity release schemes.
Introduction
Retirees feeling the pinch of higher living costs, are reluctantly making difficult decisions as they draw dangerously close to outliving their retirement savings.
A 2021 report released by the Association of Superannuation Funds of Australia (ASFA) found that 90% of Australians who died aged over 80 years had no superannuation savings – an alarming statistic given that our average life expectancy is currently 83.6.
For many retirees, the family home remains their only asset. Not generally subject to capital gains tax, or assessable under the assets test, it represents financial security, independence and family history which is why downsizing is an unpopular option.
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