Seniors should boost cash by selling home
Senior homeowners should boost their cash reserves by selling their homes while prices are high, according to Aged Care Gurus.
The financial advice firm said many asset-rich cash-poor seniors were missing out on the opportunity to build on their existing home equity and improve their living standards.
Aged Care Gurus principal, Rachel Lane, said senior homeowners could boost their cash reserves by tens or hundreds or thousands of dollars by selling while prices are high and moving into more affordable accommodation.
"While housing affordability is generally considered a young person's issue restricting entry to the market, it is also a major problem for those that do own a home but rely on a low weekly income," Lane said.
Lane noted the Government's productivity commission's housing report found more than 90 per cent homeowner Age Pension recipients currently under the Association of Superannuation Funds of Australia's threshold for modest retirement standards could reach that benchmark over the rest of their lives by using their home equity.
"The report also suggested households aged 65 to 74 years had on average $480,000 in home equity, which compared to the cost of a more affordable home in the vicinity of $200,000 to $300,000 represents a significant gap of potential cash reserve," Lane said.
"Senior homeowners looking to downsize needn't be competing in the private market against homeowners and investors, which is a common fear, as there are a variety of traditional and new home options to suit."
Recommended for you
Money Management examines the share price of financial advice licensees over one year to 31 March, with M&A actions in the final quarter having a positive effect for two licensees.
A $3.5 million settlement for victims of Melissa Caddick has been approved by the Federal Court following an initial agreement last December.
The Reserve Bank of Australia has delivered its first rate decision since the introduction of a new board structure last month.
Digital advice provider Otivo has launched an interactive tool, powered by artificial intelligence and Otivo’s own advice engine, to help answer client questions.
