WIth so many Baby Boomers getting ready to retire, the need to use home equity as part of an overall retirement strategy has never been more important. But as US News reports, after five years of home value declines, many seniors have growing concerns about what to do about not only their homes, but their overall retirement plans.
The National Council on Aging (NCOA) believes the use of home equity will be on solution and recently rolled out the Home Equity Advisor with the support of the Financial Industry Regulatory Authority (FINRA).
“What we’re seeing from the reverse mortgage world is that people are in a lot of debt,” said Barb Stucki, vice president of NCOA’s home equity initiative during an interview with US News. “A lot of people are thinking about trying to tap the equity in their home, or perhaps downsize to a smaller home to save money … Our big concern is that if people do tap the equity in their home that they have access to a broad range of possible solutions and not just a single option.”
Stucki stresses that people must think more strategically when it comes to their home equity, especially now since the options to utilize it are so limited.
NCOA would like to see “the financial services industry develop more innovative products” involving home equity. One example Stucki cited would be a more targeted product that ties the use of home equity funds to a single spending need, such as paying for long-term care expenses.