Retirement Planning & Experiences

[VPS]

There is the Centrelink reverse mortgage if you are age pension age. I think it is excellent , no need to do this ubiquitous downsizing which is so often suggested .

Does anyone have an experience using this - is this better than reverse mortgage with a bank?

I don't want to move because I'm in a great location and will be able to stay for many years here but want to release some capital for more travelling

 

[mrsterryn]

@VPS the old scheme was so incredibly coughbersome but this one appears to be a lot more easier though it is limited . I think when someone wants to stay at home and money is an issued that this would make life easier .

https://www.servicesaustralia.gov.au/home-equity-access-scheme

 

[CaptJCool]

Does anyone have an experience using this - is this better than reverse mortgage with a bank?

I don't want to move because I'm in a great location and will be able to stay for many years here but want to release some capital for more travelling

The take up rate of reverse mortgages is lowish
Estimated 40,000

The Rise of Reverse Mortgages in Australia - Lextech

Reverse mortgages are increasingly becoming part of Australia’s retirement finance mix. Once seen as niche or last-resort products, they are now used by tens of thousands of older Australians to access the value of their homes without selling or moving. According to the Australian Government’s...

www.lextech.com.au

Interest rate is 3.95%

A no negative equity guaranteeapplies to Home Equity scheme

This is different to a reverse mortgage provider

Reverse mortgage and home equity release - Moneysmart.gov.au

Understand how a reverse mortgage or other equity release product works. Get independent advice before you go ahead.

moneysmart.gov.au

So

4% compounded annually on $100,000 over 30 years would grow to approximately $324,339.59.

Breakdown:
- Principal: $100,000
- Interest: $224,339.59
- Total: $324,339.59

This calculation uses compound interest formula: A = P(1 + r)^n, where A is the future value, P is principal, r is annual interest rate, and n is years.