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One option you can consider to free up some much-needed cash to fund a comfortable retirement is to sell your house. This can make good financial sense on paper, but the decision is not as simple as simply contacting real estate agent and putting a sign on the lawn.
Your home holds many memories of times spent with loved ones. If you are thinking of selling the place where you raised your family or lived with a beloved spouse who has passed on, it can be very difficult to move on.
There is more than one solution to this issue, though. Before you make any decision, consider you options carefully to take into account your short and long-term financial needs.
Alternatives for a Comfortable Retirement When you Don’t Want to Sell your House
Take out a Reverse Mortgage
Many older Canadians have seen the value of their homes increase significantly over the years, and taking out a reverse mortgage is a way to access some of the equity while retaining ownership and control of the property. This type of plan is available to Canadians aged 55 and older.
You can choose to access the money either as a lump sum or in installment payments which will give you a regular income. These plans are flexible enough that you can choose a payment option which includes an initial advance to pay off debt or make necessary repairs and that will continue to give you the cash you need over a longer term. No payments are required until you decide to sell the house or you die. To determine whether this makes sense to you, it’s a good idea to discuss your situation with a financial planner who can point out the advantages and disadvantages of this option for your personal situation.
Share Your Home with Your Children
The cost of buying a home is moving out of reach for many young families, or it is taking them much longer to save the money required for a down payment while paying for child care and other expenses. Consider having an adult child and their family come to live with you.
By pooling your resources, everyone could benefit from this type of arrangement. Your adult child can save on the cost of childcare if you are willing and able to care for your grandchildren and you can discuss getting some help with paying for the cost of running the household instead of paying rent.
Create Income by Adding an Apartment
If you have a basement with a separate entrance, you may be able to turn that space into some cash by renovating it into a legal apartment. You will need to check the zoning for your neighborhood, but this can be a way to generate some much-needed income. Before you decide to become a landlord, you will need to review your rights and responsibilities under provincial law.
Do you need help choosing an alternative to choosing to sell your house to have a comfortable retirement? As an experienced financial advisor, I can help you find the right solution for your needs. Contact me for a complimentary consultation.