There is a proven difference between the family wealth between households who are homeowners and households who are renters. A major factor in that difference is the equity that homeowners build up over the time that they own their home. This can be a major part of your retirement planning.
When you total your savings and retirement plans and your home equity this represents almost all of what families have to use for the retirements expenses. Let’s face it Social Security alone doesn’t quite do it. Many of the people who have traditional pensions, such as government employees, may be in slightly better shape. But without the equity that gets built up in the house, it quite possibly would not be enough for people to retire in the way that they would like.
Most adults, when they reach the traditional retirement age, should count their home as their most valuable asset. It’s usually worth considerably more than retirement accounts, other savings accounts, and other non-financial assets. When it is time for you to retire, you can use your equity in the home through reverse mortgage or by selling your home and downsizing to a less expensive home. Your home, and the equity involved, is a critical piece of your retirement planning