Each of your 55+ clients has unique financial needs and goals. Some will be motivated by the need to help their children with a down payment on their first home. Other clients may want to travel, explore new interests and maintain their desired lifestyles in retirement. Others may still be interested in renovating their homes with the goal of aging comfortably in place. Often your clients’ planning objectives overlap – they may want to assist their children financially and maintain their investment portfolios.
Understanding your clients’ different needs can help you provide them with the best advice for their situation. But finding the right solutions to meet their objectives is more challenging today, as rising inflation and high-interest rates are making it difficult to achieve cash flow certainty and confidently plan ahead. One option worth considering is the CHIP Reverse Mortgage by HomeEquity Bank.
A flexible cash-flow solution
With this innovative solution, Canadians 55+ can access up to 55% of their home’s value in tax-free cash. Monthly mortgage payments aren’t required until they move or sell, which frees up additional cash. An added benefit is the flexibility the CHIP Reverse Mortgage provides: Clients don’t have to take the full amount of the reverse mortgage they qualify for; they can access funds whenever the need for cash flow arises.
While many scenarios warrant a discussion, here are three about how the CHIP Reverse Mortgage can help your clients get ahead financially.
1. Your clients want to retire debt-free.
Retiring debt-free is a dream shared by many Canadians. However, the pandemic and skyrocketing inflation have put this goal on hold in recent years. Canadians are increasingly turning to debt to cover their expenses – whether credit cards to cover daily needs or lines of credit for larger, unanticipated expenses.
A recent Equifax credit trend report found that Canadians’ debt levels rose more than 7% in the third quarter of 2022, with average non-mortgage debt rising to $21,183 per consumer. Living with debt can be stressful at any stage in life, but in a climate of rising interest rates, it can be particularly challenging for older Canadians who don’t have access to regular income.
If you have clients in this situation, the CHIP Reverse Mortgage may be worth considering. Clients can access tax-free cash and then use those funds to consolidate their debt and gain some peace of mind.
2. Your clients want to help their child purchase a home.
Although home prices have come down in the past year, buying a home remains a distant dream for many young Canadians. With the CHIP Reverse Mortgage, your clients can gift their children or grandchildren a down payment to help them realize their dreams today – without having to dip into retirement savings or take out a conventional mortgage with its monthly payments.
3. Your clients want to build up their nest egg.
Many Canadians have had to dip into their savings to meet their expenses in recent years. In addition, markets have been quite volatile since the beginning of the pandemic, which may have contributed to portfolio downturns. Even those clients who have planned well may face unforeseen hurdles that leave them with smaller nest eggs to cover their longer lives. For clients facing these challenges, a reverse mortgage can help rebuild their nest eggs and allow their retirement savings to continue growing tax-free while they wait for markets to recover.
To learn more about how the CHIP Reverse Mortgage fits into your client’s financial plans, visit us online or contact a Business Development Manager today.