Buy a house to save for retirement | Loans Quebec

Image result for buy a house for retirementPossession of a house has advantages. You no longer waste your money on rent, you do not have to deal with unpleasant homeowners, and you know you always have a place to live. While these factors appeal to young people, there is one thing that few people think about: the benefit of owning a home when you retire.

Retirement

Most likely, you do not want to spend your whole life working. Maybe you want to use your money to cruise in the Caribbean or to spoil your future grandchildren. Having a home can help you achieve your dreams. For that, think of your house as an investment rather than an expense. With each of you, you put in a little money until the house belongs to you. Then, if you ever need money later, you can always withdraw it. If you are lucky enough, you can even make money if the value of your home increases.

Reverse Mortgage

For people over 55, a reverse mortgage is a loan secured by your home, up to 50% of the value of your home (the amount that was paid). While monthly payments are not needed, the residual value of your home decreases. If you decide to sell your home, you will first have to pay off all interest accrued during your reverse mortgage.

Mortgage line of credit

If you need money to pay for your children’s education or to make the much needed renovations, you can still use a home equity line of credit. If you are approved, you will receive a credit proportional to the value of your home. Retirees, for example, can use this money to pay for well-deserved trips, to make the necessary payments or even to improve their homes.

Rent your home

More and more popular practice, the rent of a part of his house or a room of his house is frequent thing among the owners. For retirees, for example, this extra income to help them support themselves. On the other hand, those who do not own a home do not have access to this source of additional income. On the contrary, it contributes to the financial stability of someone else.

Size reduction

“Buy low and sell high” is the general idea of ​​the market. In the long run, homes usually appreciate value. For example, someone who paid $ 200,000 for their home 30 years ago could sell it today for $ 300,000, for a profit of $ 100,000. Although big houses are a great place for the whole family, once kids leave, retirees no longer need that extra space. Rather than rent empty spaces, they prefer to sell the house and with the profit obtained, they often buy a smaller house, more adapted to their way of life.

Finally, buying a home is a great investment in your future. Those who are or will be homeowners will have the opportunity to retire with a range of options in their bag thanks to the residual value of their home.