A Green Paper from the Actuaries Institute, Unlocking Housing Wealth, released last month claims that the family home is a store of considerable, though relatively untapped, wealth for current retirees.
The paper addresses the dilemma of current asset-rich, cash-poor retirees whose wealth is tied up in the family home.
The paper highlights proposed policy changes to enable older Australian home owners on low incomes maintain a modest retirement living standard over the remainder of their lives by drawing on their home equity.
The Actuaries Institute has produced several papers in recent years investigating the potential impact of Australia’s changing demographics on the financing of retirement incomes, aged health care and related issues of intergenerational equity.
The paper continues the discussion on longevity risk and raises policy options that could help improve current retirees’ living standards.
It identifies the value of Australian retirees’ housing wealth and costs associated with retirees’ accommodation, aged care and health care needs
Proposed policy changes in the paper aim to remove constraints on older Australians from accessing part or all of their housing wealth to improve their standard of living in retirement.
The Institute’s proposed changes include a partial assets cap for pension asset testing and an exemption for cash derived from equity release from the family home.
The Institute further calls for better regulatory protection for the elderly from financial abuse by those who stand to gain from the retirees’ assets.
You can review the full Actuaries Institute Green Paper here
You should seek qualified financial advice when planning your retirement. You should also consult a Wills and Estate professional who can help you with your estate planning.
Contact Gill & Lane Solicitors at Sandgate via GregL@gillandlane.com.au, or 3269 8111 for a free, no obligation consultation.
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