As the Baby Boomer generation ages, the average age of homeowners trends older as well. Unlike the generation before them, many baby boomers are retiring with greater amounts of debt, without pensions, and without sufficient savings. For many older adults, their home is their largest source of wealth. They may need to tap into that source of wealth to pay for their living expenses in retirement and ultimately, their long-term care. So how can older adults utilize their home equity to cover expenses and protect this source of wealth as they age?
The Consumer Financial Protection Bureau (CFPB) developed the following four “just in time” guides to assist older adults in navigating this question.
- Loss of a spouse/partner: Losing a spouse or partner can affect every aspect of a person’s life, including housing. This guide helps homeowners consider their options and determine whether staying in their current home makes the most sense.
- How to navigate a change in health: Whether a homeowner is currently going through a medical crisis or facing one, it is important for them to consider housing options that provide care and support. This guide helps homeowners assess their needs, navigate available housing options, and gives them the confidence to make the right decision for their situation.
- How to leave home to children/heirs: Many homeowners want to hand down their home to their children or other heirs when they die. Planning ahead can simplify the process, lessen costs, and potentially decrease family conflicts. This guide helps homeowners evaluate the different ways to pass down their home and discusses benefits and risks.
- Using home equity to meet financial needs: Owning a home is most people’s greatest asset and can be a resource for greater financial security. This guide describes the benefits and risks associated with financial products that the homeowner may use to meet retirement shortfalls, pay for long-term supports and services, and age in place.
The guides are available to download in English and will soon be available in eight other languages.