A frequently talked-about topic in real estate is the difference in equity between homeowner households and renter households. People who are able to own their own homes are investing money into their homes whereas renters are not seeing a return on the money they are spending on their rent. This homeowner equity plays a large part in retirement planning.
Craig Copeland, Senior Research Associate at Employee Benefit Research Institute (EBRI), recently reported on this in Importance of Individual Account Retirement Plans and Home Equity in Family Total Wealth:
“Individual account retirement plan assets, plus home equity, represent almost all of what families have to use for retirement expenses outside of Social Security and traditional pensions. Those families without individual account assets typically have very low overall assets, so they have almost nothing to draw from for retirement expenses.”
Home equity is a major asset for homeowners nearing retirement. Owning a home provides financially security. Whether you are using your home equity for a reverse mortgage or for selling and downsizing to a smaller home, it plays a big part in the planning for retirement. If you'd like to learn more about building equity through owning a home, call us and we can help you develop a plan.
Source: Keeping Current Matters