Using your home equity to supplement living expenses

Using a home equity release loan to supplement your retirement income and cover living expenses can be a smart way to maintain financial stability and enhance your quality of life during retirement.

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How it works

There are two ways a home equity release loan can be used to supplement your living expenses

Taking the loan as a regular income payment

By choosing to take the proceeds of your loan as a regular income payment you only pay interest on the funds as you need them, and you enjoy the financial security of knowing that you will have additional income for the period that you have nominated. This option can be particularly beneficial if your retirement savings or pension are not sufficient to cover your monthly living expenses.

Setting up a line of credit for unexpected living expenses:

The funds from a home equity release loan can also be taken as a line of credit and used to cover various living expenses, such as healthcare costs, home maintenance, utility bills, and daily necessities. Like a regular income payment, you only pay interest on the funds as and when you draw down the line of credit. Having this safety net can help you maintain your standard of living and provide peace of mind so that you can focus on enjoying this time in your life.

What are the benefits?

Here are some of the key benefits to consider when using a home equity release loan to cover living expenses:

1

Financial flexibility

A home equity release loan provides financial flexibility, allowing you to access funds as needed. Whether you require the flexibility of a line of credit or the security of regular monthly payments to supplement your income, this loan can be tailored to your specific financial situation.
2

No monthly repayments

With a home equity release loan there are no monthly repayments required throughout the duration of the loan. The loan is typically repaid when the property is sold, or you move out, which can alleviate the pressure of making regular payments during retirement.
3

Stay in your home

One of the significant advantages of a home equity release loan is that it allows you to stay in your home. You can continue living in a familiar environment while accessing the financial resources you need.
4

Increase in cash flow

By supplementing your retirement income with a home equity release loan, you can increase your cash flow, making it easier to handle unexpected expenses or enjoy discretionary spending on travel, hobbies, or other interests.
In summary, a home equity release loan can be a valuable tool for supplementing your retirement income and covering living expenses, providing financial flexibility, increased cash flow, and the ability to stay in your home. However as always, it’s important to carefully consider your long-term financial goals and future needs and assess whether a home equity release loan is right for you. With proper planning and advice, this option can help you enjoy a more secure and comfortable retirement.

Meet Murray and Margaret*

Murray, 72, and Margaret, 68, a retired couple from Castle Hill NSW, found that their existing superannuation and retirement savings were insufficient to cover their monthly expenses and maintain their desired lifestyle. Despite having paid off their mortgage some time ago, rising living costs had meant that their current retirement income was not enough to cover unexpected expenses or allow them to enjoy the retirement activities they had hoped to pursue.
Cool couple enjoying their own home
Cool couple enjoying their own home

How Inviva helped

To supplement their income, they decided to explore the option of a reverse mortgage. After consulting with both their children and a financial advisor, Murray and Margaret opted for a reverse mortgage secured against their home, valued at $1.4m.They arranged to receive a regular income stream of $3,000 per month, which would last for eight years, by which time they expected they would be ready to downsize and pay back the loan.

This additional income provided the financial stability they needed to cover living expenses, healthcare costs, and enjoy leisure activities without the constant worry of running out of funds. The extra $3,000 per month significantly enhanced their cashflow, allowing them to travel each year, engage in some new hobbies, and spend quality time with their grandchildren.

By leveraging their home equity, Murray and Margaret were able to enjoy their retirement years fully, without the constant worry of making ends meet – all while staying in the home and community they loved.
“Using the equity in our home to improve our lifestyle was one of the best decisions we made for our retirement. The extra $3,000 a month has given us the financial freedom to enjoy our lives without worrying about money. We can travel, spend time with our grandchildren, and we stay in the area we know and love. It's truly been a lifesaver for us.”
- Margaret 
*Case studies and quotes are illustrative of and inspired by some of our customers’ experiences.

Why choose Inviva?

  • Expertise & support — our team has years of experience and offers personalised support
  • Transparent costs — no hidden fees, and you know all costs upfront
  • Flexible options — choose how you access the funds - as a lump sum, regular income payment or a line of credit - and enjoy the flexibility to repay early with no early repayment fees
  • Quick access — fast approval and disbursement mean you get funds when you need them
Explore how a home equity release loan with Inviva can help you enjoy a more secure and fulfilling retirement.
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Cool couple enjoying their own home

Free Home Equity Release Loan Guide

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