Your home is more than a place to live, it is also a valuable asset and making good use of home equity can help you fund important needs as well as boosting your future financial well-being.
Home equity is the difference between your home’s value and the balance of your loan, and the combination of today’s low interest rates and rising property values means you could have more in equity than you realise. Families with kids can face considerable outgoings – expenses that are worth planning for.
Research suggests it costs a typical middle income family $812,000 to raise two children from birth until they leave home. When it comes to meeting expenses like school fees, home equity can offer low cost finance options. For example, extending your home loan to meet education bills can be a lot more manageable than using a personal loan or credit card to meet the cost.
Even when the kids grow into adults, you could still face some substantial bills.
Government figures show almost one in four (23%) people aged 20–34 years live at home with their parents. Having adult kids at home can be lots of fun but it’s important for everyone to have their own space. Home equity can offer a source of funds needed to extend your home so that everyone has room to move.
One option to manage future expenses is by building a portfolio of investments. It may be possible to use home equity in lieu of a deposit to invest in a rental property. Or tap into equity to fund other assets like shares.
These sorts of assets don’t just provide additional income to meet today’s expenses; they can also deliver long term capital growth to provide additional wealth when you are approaching or in retirement. The bottom line is that home equity is often an under-utilised resource.
Contact us and let us help you release your home equity to build wealth