Importance of Seeking Financial Advice Before Retirement
As you approach retirement, you may feel a mix of excitement and uncertainty. On the one hand, transitioning into your golden years can open possibilities to explore new interests, hobbies, and places. On the other hand, your typical income and expenses may change. Retirement advisors can help you make sense of all of this. If you’re on the fence or don’t know where to start, let’s explore why it is important to get financial advice for retirement planning.
What is a Retirement Advisor?
A retirement advisor can help you make sense of this brand-new chapter in life. Budgeting, investing, and debt strategy can seem overwhelming if you’re not a financial expert. The good news is that an advisor will help you plan for a comfortable retirement. Areas often explored include maximizing retirement income, paying off debts, planning for unexpected costs, and managing investments and taxes.
Why do You Need a Retirement Advisor?
Unique circumstances can arise as you enter retirement, different from anything you experienced in your working life. As you face changes to your income while taking on new expenses, you may develop some concerns. A report from 2018 reveals that one-in-four seniors (60 and older) fear running out of money, while an equal amount worries that they will be unable to pay for long-term care. Other fears include not having enough money to retire, being unable to pay off debt, needing to rely on their children for financial support, or being forced to sell their house. Overall, nearly half of seniors report having at least one financial concern.
Finding Solutions to Unique Retirement Circumstances
Getting financial advice for retirement planning will help you explore solutions to these new circumstances and worries. Retirement advisors will take into account your personal needs. They may recommend specific budgeting strategies and ways to maximize your income to ensure you can live out your retirement years comfortably.
If you are a homeowner, you may find that your financial planning journey includes exploring reverse mortgages, home equity loans, or credit line options. For example, a CHIP reverse mortgage in Canada gives you access to the money from your home equity without selling your home or making monthly payments. You can use this money for travel, healthcare costs, home improvements, or paying off outstanding debts. A reverse mortgage allows you to access up to 55% of the value of your home, but if you need more money, you may consider home equity loans which allow you to borrow up to 80%. You can discuss these options with your retirement advisor, specifically a reverse mortgage broker, to help you find more room to maximize your income.
Consulting with a reverse mortgage broker can give you a better idea of how these solutions can be customized to meet your unique needs. They’ll help you understand if you qualify, how much you can receive, the advantages and risks, and ultimately, if these options are the right choices for you.
Conclusion
When choosing a financial advisor, it could be helpful to take into account their client base. That said, retirement advisors who work primarily with pre-retirees and retirees would support you best during this stage of your life.
Whether you’re worried about your finances or excited to jump straight into retirement, the bottom line is that seeking financial advice before this time comes can help you resolve your concerns, maximize your income, and ensure you’re on the right track. At Seniors’ Lending Centre, we can discuss the different mortgage and home equity options together to help you make the most of your golden years. Get in touch with us to explore what lending options work best for you.
