Being retired is such an awesome feeling! You no longer have to work for a living, and can now live out your twilight years doing whatever you want to do! Some folks go on vacation around the world and explore places that they never had the time to when they were working, whereas others might take up some new and interesting hobbies.
The only negative point about being retired is that you no longer earn the same amount of money that you used to when you were working. All you can rely on is your social security income and any private pension income that you might have built up whilst you were working.
Despite this fact, a large number of Americans are able to get by on their reduced incomes. But if you are retired, and you want to fund a major expense such as some building work in your home or maybe you want to buy that Ford Mustang you’ve always wanted, how do you come up with the cash?
One common way to raise money without having to get a job again is to simply tap into your property’s equity! That’s right; if you own your home, you will be able to use it to allow you access to those much-needed funds.
Here are some of the most-common ways of doing so:
Buy a smaller home
Now that you have retired, your kids will have obviously grown up by now and perhaps have families of their own. A lot of people find it easier to simply sell their homes and downsize into smaller ones because they don’t need all of the extra space that is currently unused.
This is a great way of raising any extra cash that you might need, because it means that you don’t have to work for it nor do you have to borrow the money.
Over the years, you might have built up some tangible and non-tangible assets which hold a certain amount of value. This might be shares in companies or precious metals, jewelry, or you might have even amassed some collectible items which have appreciated in value since the time you acquired them!
Some folks might not want to sell certain items for sentimental reasons, but if you wouldn’t be upset by selling any assets that you have kept during your life, it might be worth considering selling them if you need the money.
Get a reverse mortgage
If you need access to a significant sum of money, another option that is open to you is to get a reverse mortgage. Such home loans are similar to standard mortgages, except that any money that you borrow is repaid when the house is sold – either by yourself or by whoever manages your assets when you die.
There are certain eligibility criteria that you would need to fulfil, but thankfully there are plenty of websites that describe in detail just how do reverse mortgages work. Although this option means that you are borrowing money, you are only borrowing money against the equity within your home.