James Coyle

A user’s guide to the Home Equity Access Scheme (HEAS)

Using home equity as a retirement income seems to be the last well kept secret. But that, too, is changing as more industry commentators scrutinise the home wealth access products on the market and conclude that they do have their place in retirement funding. This is why home equity became quite a talking point a few weeks ago, after the Actuaries Institute pressed for stronger encouragement for such loans. You may recall our coverage of this report, which drew lots of robust debate in our comments section.

The comments tended to fall into one of three camps:

I will never, never, never do this,

I might do this, under certain circumstances, or

Why not? I’m prepared to take a look.

Today we focus on the government’s Home Equity Access Scheme (HEAS) as it is this form of home equity access that is showing the most rapid uptake. The other two main types of equity access are:

Reverse mortgages which are offered by a range of private lenders. The loan is repaid when the property is sold or when the borrower passes away.

Home reversion schemes again offered by private lenders, where a portion of the equity in the home is either sold for a lump sum (or regular payments). The lender has an agreement for a share in the future sale of the property.

Can you really afford to help your grown-up kids?

by James Coyle | Retirement Advice

Do you believe that the so-called generational wars are a media beat-up? Or is there actual conflict between baby boomers and their children for a fair share of the financial pie?

It’s a question worth considering at a time when Australia is undergoing the largest ever intergenerational transfer of wealth – calculated to be worth some $3.5 trillion over the next 20 years.

Have you thought about your own situation? Have you considered how much you might be prepared to give – and when?

A recent report from financial services company, AMP, had some interesting insights.

Some believe that baby boomers are a ‘greedy’ generation, pocketing bumper tax concessions and giving little back. But the AMP findings suggest something different, with four in five Australians aged 65 and over believing that their children face similar or harder financial challenges than they did growing up. This is borne out by facts that baby boomers aged 25-39 (in 1991) were three times more likely to own their home outright than those aged 25-39 (in 2021).

Five worst reasons people delay their Age Pension application

by James Coyle | Centrelink Age Pension

A few years ago there was a terrific public safety advertising campaign developed by Metro Trains in Victoria called Dumb ways to die. It was designed to promote railway safety and became the world’s most shared public awareness campaign. It also spawned a video game of the same name. I was reminded of that campaign when writing this article and at the risk of offending some of our readers I was tempted to call this article Dumb reasons to delay.

My alternative title is apt in many ways as so many people delay applying for the Age Pension for reasons that are just plain wrong and ultimately very costly. It could be because they are misinformed, they believe an urban myth or just don’t understand the rules. Today I’m listing the five worst (dumbest) reasons and sincerely hope you have never made, or will make, any of these mistakes. But believe me when I say, many people do.