Below are media releases, articles & my personal submission to the government that are all good reading & of interest to you
About the RBS Reverse Mortgage Survey
June 2009: The RBS Reverse Mortgage Survey was conducted in December 2008 to provide unique insight into Australia’s $2.5 billion reverse mortgage industry.
Over 400 reverse mortgagees nationally were surveyed* to establish what is driving the use of reverse mortgages amongst Australian retirees; how the money from these loans is being spent and the impact the loans have on the lifestyle and overall wellbeing of the respondents.
The results from the survey have dispelled the ‘SKI’ (spending the kids’ inheritance) myth that retirees use reverse mortgages to fund extravagant holidays or to purchase unnecessary luxury items.
98% of the study's participants stated that they would recommend a reverse mortgage product to friends of family.
Most popular uses:
Home repairs - 32.6%
These were not grandiose renovations but more often minor repairs or alterations to make the property more suitable for retirement (e.g. ramps and handrails etc) often so the respondent could remain in their own home.
Common responses
“We have been able to make our home more livable as we get older. This is important to us”.
“My house has now increased in value due to repairs and renovations”.
Income - 18.7%
The aged pension is insufficient for many retirees who choose to take a reverse mortgage in the form of regular monthly payments or as a line of credit.
Common responses
“It completely turned my life around to have money for simple things at my age”.
“Bridge some of the affects of losing 25% of our SMSF in the stock market”.
Helping family - 6.6%
The ability to use their primary asset to help family members is becoming increasingly popular. Many retirees helped children afford a deposit on a house, paid for a wedding, or helped family to cover the cost of education.
Common responses
“Great being able to help two of our three children buy and renovate properties while we can still enjoy our home”.
“To ease the financial burdens of our young daughter”.
Rainy Day facility – 4.2 %
Many customers have set up a flexible drawdown, which acts like an overdraft or line or credit. This money is there for people when they need it.
Common responses
“Peace of mind knowing that of any major disaster happened I would be able to use the money to fix it”.
“The pension doesn’t cover repairs to the home. The worry of unforeseen expenses is gone”.
About Reverse Mortgages in Australia
Reverse mortgages, or senior equity release loans, were introduced to Australia in 2005. The loans allow people over 60 to borrow against the value of their home. Payments and interest are not due until they sell the home or permanently vacate it.
Statistics collected by RFI and self-regulatory body SEQUAL have found that as many as 31 per cent of Australian retirees expect to rely on their home as a source of retirement funding.
About RBS Reverse Mortgages
RBS Reverse Mortgages is a member of the industry self-regulating body, SEQUAL, and supports innovative and responsible lending to Australia’s seniors.
RBS' Reverse Mortgage has won Money Magazine ‘Best of the Best Reverse Mortgage" 2007, 2008 and 2009 and Your Mortgage Gold winner for ‘Best Reverse Mortgage – Bank’ 2007 and 2008.
Is it time to tax the rich?..
ANTHONY KEANE, MONEY EDITOR | March 08, 2009
MOTHERS and low-income earners need more benefits to build their retirement nest eggs, and rich retirees should help foot the bill, superannuation groups say. They say the Howard government's 2007 super reforms delivered big savings to high-income earners but little to the masses, and are calling for several changes to the system. In a joint submission to the Federal Government's tax system review, the Industry Super Network and the Australian Institute of Superannuation Trustees want the 15 per cent tax on super contributions scrapped for people on low incomes......................
Green left - Australia govt robs....
Govt robs ‘wealthy’ to pay pensioners
Graham Matthews7 March 2009
On February 27, the federal government received a report on the review of the pensions system conducted by Jeff Harmer, the head of the families and community services department.
While the results of the review have not yet been made public, speculation is growing that the government will fund increased payments to pensioners by cutbacks to those receiving a part-pension.
The February 27 Sydney Morning Herald revealed that the likely government plan is to raise the rate at which the pension is reduced for income earned (the taper rate).............................
Seniors world chronicle..
SYDNEY, NSW / The Sydney Morning Herald / National / February 26, 2009
By Stephanie Peatling
THE pension system is so badly organised that more than 50,000 people with disposable income of more than $60,000 receive the age pension and a further 14 per cent are paid the benefit despite their assets being worth $1.6 million...........................
