Future Finance Solutions

Using Your House as a Retirement Aid

November 27, 2015 by · Leave a Comment 

Money in your handsSaving for retirement is an important priority at a younger age. You want enough for sustenance as well as a comfortable and free life. If you’re considering using your home as an aid to your retirement fund, here are some suggestions that you should consider that will help.

Before you retire, and if you can afford it, you have the option to pay off your mortgage. Doing so will take a huge weight off your shoulders and also allow you to have more financial flexibility upon retirement.

If you are currently in a large home that has excess rooms and space, you might want to consider downsizing to a smaller house. Doing this can save you thousands and help put that towards your retirement account. For example, an increase in cash flow can come out of selling a home for $400,000 and buying one for $200,000. That excess $200,000 can be put towards investments or a savings account – not to mention the smaller mortgage payments on your downsized home.

Another option is to rent out the rooms in your house. If you want a passive stream of income, this is a good choice as you’ll most likely be renting out to someone that you trust and also receive a monthly check for a room that’s actually being put you use instead of just gathering dust.

A reverse mortgage is an option for retirees to live off the equity that has been built up in their home. It’s paid in either a lump sum or in installments and is an option if you want a steady stream of revenue.

Bio: Kuba Jewgieniew heads Realty ONE Group, a full-service residential real estate brokerage firm.