Successfully Aging in Place and the CHIP Reverse Mortgage
The majority of Canadians would really like to age in place. In fact, a survey conducted by the National Institute of aging and the Canadian Medical Association found that 96% of Canadians would like to age in their own home and live as independently as possible for as long as possible.
But there's a possible challenge in people being able to actually achieving this. A March of Dimes study discovered out of the people that they surveyed who wanted to age in place, only 26% predicted that they would actually be able to do this resulting in what some are calling an aging in place gap.
To discuss this topic further and how a CHIP Reverse Mortgage could possibly help someone be able to successfully age in place and close this gap, Susan Williams was pleased to welcome Vivianne Gauci from HomeEquity Bank in this Learning Bites episode.
Here are some of the highlights of their discussion;
What does aging in place really mean?
Aging in place really just refers to how people want to stay in their own homes as they grow older. Usually there is a whole host of reasons. For example, staying in your community, living nearby friends or family, preserving the memories that you may have that help you feel most comfortable living there rather than starting over and in a new place.
This can be especially important once we get older and possibly start feeling that as we age things are starting to change in our lives physically and/or mentally. As is often said, home is often where our heart is and to remain living in our homes as we age can provide us with both an emotional and physical benefit.
As much as there are benefits to aging in place, there are also some risks to being caged in place. How can people make sure that this doesn’t happen to them?
We like to think of it as this as the Golden Triangle of Happiness. This is based on a study completed by Deakin University in Australia and when they summarized what can really make people happy they summarized it to three different areas.
Connection – ensuring that we are connected to those we care about and that we love and they are connected to u
Sense of Purpose - making sure that you feel like you know you are enriching somebody else’s life and doing something that has meaning and is making a difference
Financial Control – having the ability to have the financial control that you are able to maintain yourself in life
How could a CHIP Reverse Mortgage possibly help someone successfully age in place?
There are a lot of barriers to successfully aging in place. From being able to afford your mortgage payments, to the current economic climate and inflation making everything more expensive. Plus you might have to do home renovations because you the home to be more accessible. There is even the possibility that down the line, you might need some help from a health care perspective.
If you are a homeowner, there are some options to support being able to age in place. The CHIP Reverse Mortgage being one of them.
When someone approaches us for information, the first thing we tell them is to do your research and make sure that they are considering all their options. What they most often discover is that our product is a safe and secure financial solution. The CHIP Reverse Mortgage allows people to access up to 55% of the value of their home. It is tax free and doesn’t impact CPP, OAS or any GIS. Another key point is that it doesn’t require monthly payments so if you have an existing mortgage, this can free up a lot of cash flow in that they are no longer having to make those monthly payments anymore.
This may not be the solution for everyone, and people need to explore their options and do their research but the CHIP Reverse Mortgage may be able to help address the Golden Triangle of Happiness by helping to provide a sense of financial control.
To do some of the physical changes necessary to successfully age in place there are some other alternatives to do this. Can you share how they might be different than a CHIP Reverse Mortgage?
If you wanted a home equity line of credit, people definitely need to plan ahead. This could be a great solution however the banks require you to have a certain amount of income so that you can service the loan. Also, an important part of a line of credit is that they also watch to see how the line is revolving and if people are making payments on a regular basis.
If you’re not using your home equity line of credit, it can be a great safety net to have however you are never guaranteed that the bank won’t necessarily pull the line sometimes when the markets get tight.
With a CHIP Reverse Mortgage, you don’t have to be concerned about the income testing as it is designed for people who are on CPP / OAS / GIS and is based on the value of your home so it is a different approval process. This is why there is more flexibility with a CHIP Reverse Mortgage versus a typical home equity line of credit.
What should someone do if they were interested in learning more about a CHIP Reverse Mortgage?
First place to go is to visit www.chip.ca. On our website there are some calculators where you put in your age and address and we can provide an estimate of how much you may qualify for along with sharing over time what may happen to your home equity.
As well, if you would like to speak with someone directly, you can always reach us tollfree at 1-855-439-7166. Along with providing you information, we will also be able to send you your Great Canadian Retirement Guide and CHIP Reverse Mortgage guide which will provide you some more information about our product and explore whether this may be the right option for you.
