It is easy to complain about growing old, but it is sure better than the alternative. There is some naivety in our community on ageing, so for the benefit of many, a story.
Elderly mother and son came to see me. Mum is proudly independent but needs some maintenance work done on her home.
Living in her own home, no savings, no super, single pension.
Question to Mum: “Last month I was speaking to an elderly gentleman living in his own home in Mentone who never turns on the heating because he cannot afford the bills. He prefers to put on his overcoat to keep warm. How difficult do you find keeping up with the bills?”
“Oh!” she replied matter-of-factly, “I never turn on the heating, or the cooling for that matter.” Mum’s voice raised a little in obvious pride in her ability to budget as she continued; “In fact, I eat vegetarian now, I just find meat is too expensive!”
The pride in Mum’s voice was matched by the flash of horror on son’s face. He had no idea.
Mum still lives in what was the family home, on her own, healthy, and fiercely independent. Asset rich, but no income to live on, other than the pension.
Thankfully I was able to help, and Mum does not have to sell the house, or a share of it. There is little knowledge in the broader community of the “reverse mortgage” product, but for some it is the ideal solution.
We organised for mum
1) $20,000 lump sum for home repairs.
2) $25,000 line of credit facility to replace her car in the future (expected required 12 months time )
3) Regular cash payment to her account $1,000 / month to “top up” her pension, set for the next 10 years.
She can repay any or all at any time with no penalty (if she wins Tatts!), but there are no required repayments at all for her lifetime.
Please note there are significant differences between different bank offerings in this space, these products are not right for everyone, and only available over 60 years of age. Please call me with any detailed questions or queries.
A follow up phone call to Mum after was met with a “cannot believe how much difference this has made to my life” response. (And son is happy!)
Integrity Finance Australia – Changing Lives
Read more about Reverse Mortgages here and talk to us about how we can assist you.
Daryl Borden, Integrity Finance Australia Ph. 03 9511 8883 ACL 392184