Retiring singles benefit from innovative financial options
(NC) The grass often looks greener on the other side, but for those living life solo there is a constant irritation. The lifestyle is free, but chances are your income is not as green as you would like it to be.
Did you know that, on average, a married man makes more money than a single man in the same age bracket? And this is generally the same for women. According to Statistics Canada, the income of a married person is, on average, greater than income of unattached individuals. This disadvantage has obvious implications for both your lifestyle and for a financially secure retirement. Smaller income means fewer dollars to save, although innovative strategies can turn this around for retirement.
“Single people do own homes,” points out Yvonne Ziomecki, a director with HomEquity Bank. “This means that a cash flow can be arranged with a reverse mortgage. Instead of selling your house for the needed income, stay in it and receive payments based on its real estate value.”
Ziomecki says the popular CHIP Home Income Plan works like this:
If you're aged 55 and over, you can convert up to 50 per cent of your home equity into tax-free cash.
Unlike other loans on the market, you are not required to service the interest, or repay the principal until you choose to move or sell.
You also have the option to take a lump sum to pay off your debts, or for home repairs and modifications. Or you can schedule monthly advances to enhance your cash flow on a regular basis. Some homeowners do both.
“Just picture how much easier it will be to keep up with home maintenance, repair costs, property taxes and insurance premiums if you had an extra $500 or so every month,” says Ziomecki. “It means you can make any other savings stretch farther.”
A financial advisor or a mortgage broker can give you more details – and additional information is also available online at www.chip.ca.
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