Saturday, 24 July 2010 22:14
If you are “house rich” and “cash poor,” there are some steps you can take that would allow you to live more comfortably in retirement.
Downsize Your Home
If you are still living in a house that is too large for you, it might be time to either look into buying a smaller house or condo or possibly rent. This will help free up cash and also lower the amount and cost of maintenance. Not comfortable with the idea of selling a home you’ve lived in for years? Think about selling to a relative to keep it in the family.
This is a loan that uses your home as security or collateral. You can usually expect around 60% of the home’s value. Benefits of a Reverse Mortgage include monthly income and no payments. There are some disadvantages to this such as a decrease in the estate inheritance value, so you need to talk it over with a professional.
Investment Real Estate
If you are using real estate property as income, you may be able to make just as much if not more through investing the money made by selling the property. Make sure to calculate the cost of owning the property such as payments, maintenance, and association fees. It may be more profitable to sell the property and live off of the funds.