Rethinking Retirement: Why Your Home Can Be a Financial Asset, Not Just a Place to Live
Most of us were raised with the idea that being mortgage-free was the ultimate goal by retirement. And while there’s nothing wrong with financial freedom, it's worth asking: what if keeping (or even adding) a mortgage in retirement could actually increase your financial security?
With Canadian homeowners now sitting onsubstantial home equity—over 25% on average, according to MortgageProfessionals Canada—your home may be one of your most powerful financialtools. Whether you’re looking to supplement your retirement income, delaydownsizing, or fund in-home care, your house can be more than just where youlive.
Why the “Mortgage-Free by 65” Rule May NotAlways Work
Traditionally, beingmortgage-free by retirement was seen as a sign of success. But in today’smarket, that approach doesn’t always make the most financial sense. Here’s why:
Low interest rates (historically speaking): Even with recent increases, mortgage interest ratesare often still lower than the average returns from a balanced investment portfolio.
Opportunity cost: If your investments are earning 6–8% annually, it maybe smarter to carry a low-interest mortgage while keeping your money working inthe market.
Liquidity:Unlike your home, investments can be accessed as needed—without selling ordownsizing.
Home appreciation outpaces borrowing costs: In many Canadian markets, homes appreciate at ratessimilar to or greater than mortgage, HELOC, or reverse mortgage interest rates.That means you're building long-term value even while accessing cash—andstaying in your home.
3 Smart Ways to Leverage Your Home in Retirement
Refinance for Flexibility If you have strongequity, refinancing into a manageable mortgage may give you access to funds forhome improvements, travel, or healthcare—without needing to tap your retirementaccounts early.
Reverse Mortgages A reverse mortgageallows Canadians aged 55+ to access up to 55% of their home’s value—with no monthly payments. The loan isrepaid when you sell or move, and you stay in your home the entire time. Thisoption is ideal for fixed-income households who want to avoid sellinginvestments or downsizing.
Home Equity Line of Credit (HELOC) A HELOC gives you arevolving credit line based on your home’s equity. It's a flexible tool for managingexpenses like home care, gifts to family, or emergency costs—on your terms.
What About Long-Term Care and Aging in Place?
One of the biggestunknowns in retirement is future care needs. Waitlists for long-term care inCanada can exceed a year depending on your province. Most of us would prefer toage at home—but renovations, in-home care, and services all cost money. Tapping into your homeequity can allow you to:
Make accessibilityupgrades
Hire home support ornursing care
Stay close to family, neighbours,and your familiar surroundings
Avoid being forced into apremature sale or move
The Emotional Side: It’sOkay to Shift Your Mindset
We’ve all heard the advice: "Pay offyour mortgage before retirement." And for many, that feels right. But retirement today looks different. We’re livinglonger, markets are more complex, and options like HELOCs and reverse mortgagesoffer smart, flexible ways to increase financial peace of mind—without sellingyour home. You worked hard for your house. Now let it work foryou—on your terms.
Quick Tips for Using Your Home as a RetirementTool
Strategy
Ideal For
Considerations
Refinance
Lowering payments, accessing equity
Involves qualifying based on income/credit
Reverse Mortgage
Fixed-income retirees, 55+ homeowners
Reduces estate value, but no monthly costs
HELOC
Emergency fund, flexible spending
Interest-only payments; rates can vary
Downsize or Rent Part of Home
Extra income or simpler living
Emotional trade-offs
Final Thought: Plan With Professionals
Your retirement plan should reflect your life and your goals—not justoutdated rules. Whether you carry a small mortgage, open a HELOC, or explore areverse mortgage, you deserve a plan that gives you options, independence, andpeace of mind. Your home is more than where you live—it’s a part ofyour retirement strategy.
Let’s talk about how to make that strategy work foryou. Call Merge Mortgage at 647-980-5399 or email alex@ontariomortgageexpert.ca fora no-pressure consultation.
