As you approach retirement it may seem that the only way to provide yourself with financial comfiture is to sign up to one of the many equity release schemes available in order to access the equity held within your home. However this is not the case. There are other options which can be much more sensible as they mean you do not have to worry about the escalating cost of interest associated with borrowing money against your home.
One of the most suitable alternatives for retirees can be to downsize. Obviously downsizing can be an emotional task as it can mean selling off a family home which holds dear memories of children growing up. However memories are held in the heart and not within any four walls. Rather than viewing downsizing as a selling off of family history it is important to understand the many benefits of moving to a smaller house.
The key benefit is of course releasing some of the capital that was held in your home through purchasing a smaller and less expensive property. This can allow you to keep money in savings or spend it on enjoying your retirement. However this is not the only benefit. Downsizing can also be a great way of saving energy and costs associated with running a household.
A four bedroom house is often a lot more costly to heat than a smaller two bedroom apartment. By downsizing you can reduce the amount of monthly outgoings allowing you to enjoy your retirement with more financial freedom. In a time of escalating energy bills this can bring peace of mind that you will always be able to use heating during the long cold British winters.
A smaller property will also require a lot less maintenance which can either save time or money on hiring third parties to carry out work such as gardening and painting. Once again this brings a sense of freedom in the twilight years.
Downsizing is definitely an alternative which should be considered for retirees who wish to either free up some of the equity they have tied up in assets or indeed just wish to reduce their monthly outgoings in order to cope with reduced monthly income.