You’ve spent what seems like a lifetime getting your dream home, and retirement is creeping up fast. You have put the absolute bare minimum contributions into your superannuation, but it doesn’t matter because you own your house and your house is your super. Right?
Sure, this could be a possibility if you decide to sell your home and invest the proceeds from the sale in a strategy that will fund your desired retirement.
But if you plan to continue living in the home, where are you going to draw an income from?
Unfortunately, you can’t pull an income from your home, you’re more than likely going to run out of any retirement savings extremely fast, and on top of that you still have the added costs that come with owning a home (rates, insurance, maintenance/refurbishment).
Your house is a consumption item, it will cost you money to live in.
Of course, you will always need somewhere to live, but if owning your home is going to be detrimental to your retirement, it’s worth revisiting your needs and selling your home.
What’s more important to you? Living a retirement with the freedom to do more or owning your home?
At the end of the day your priorities will influence the decision, but keep in mind your opportunity costs.
Written by Ali Hogue.
Dallas Davison, Michael Hogue and Ali Hogue.