I was having a conversation with one of my realtor partners about the best strategy for one of her clients that is retired and thinking about making one last down size.  She was wondering what was the best strategy and mortgage product for them.

I suggested a big old line of credit.  Why?  Simple, equity is like your dad, you need to ask it permission to use it.  By getting a big line of credit, you will always have access to a big portion of equity.  What I cautioned was that as someone who is retired, cash flow could be an issue, and a line of credit would allow interest only payments.  But the other key is access to funds.  Will their pension really last forever? What if the government stops paying it?  Long shot, right…

Then I saw this article today about the government reinstating pensions for veterans’ affairs.  Globe and Mail:  Ottawa ends claw back on veterans’ affairs pensions.  You know what that means right?  At some point they clawed back on these pensions?  Pension for disabled veterans.  Disability benefits for people who defended our country.  So, you think OAS is safe…think again.

By taking a line of credit out, pensioners and retirees can have access to equity in case something happens to their source of income and with a line of credit you only pay if you use it…never need it, never pay.

Anyone you know, retired or close to…we need to chat.