Household Capital fast tracks funds for retirees in need

From
Josh Funder

Josh Funder

Retirees facing financial shortfalls will be able to apply for accelerated access to draw on their home equity, after independent specialist retirement funding provider Household Capital overhauled its product features and application process to meet the needs of senior Australians during the COVID pandemic.

Household Capital has announced the launch of its Home Income, a regular drawdown on home equity to allow retirees to maintain their retirement lifestyles. It’s also offering a rapid access $20,000 Top Up home equity offer to deliver financial assistance more rapidly to those retirees hit hard by the global economic downturn.

It’s been a challenging time for advisers dealing with retiree clients; many clients have faced a sudden loss of retirement income due to falling dividends, term deposit rates and rental income. At the same time, shrinking super balances run the risk of failing to recover in the future if drawn on too heavily.

Household Capital’s home equity offer provides retiree clients with a Home Income regular draw down or $20,000 Top Up quick cash injection to deliver a financial boost for those facing hardship.

Chief executive Josh Funder said advisers didn’t want their clients to draw money from super in this environment, although for some, there seems little alternative.

“We know self-funded retirees are doing it tough and facing reduced incomes due to shrinking super balances and investments,” he said.

“The Government stimulus package focused on working Australians and while the banks have provided interest repayment holidays, none of that has helped retired Australians get through the crisis.”

Applications for both Home Income and the $20,000 Top Up will be fast tracked, with the funds typically available within two weeks. Regular interest repayments are not required, and applicants can pay back the money at any time without financial penalty.

“We don’t want people to have to wait – they need that money now,” Funder Said.

“Smaller loans like these are not profitable to originate in a business sense, but we view it as a service to make sure Australian retirees have access to their savings when they really need them.”

Home equity can be an important source of retirement funding for clients when other types of income are diminished. It’s a practical option when you consider many Australian retires have as much or more saved in their family homes as in their super or other investments.

“We have experienced a surge in inquiries from advisers in the last couple of months; self-funded retiree clients need an alternative source of income,” Funder said.

“For retired Australians, their homes can be both the best place to live and the best way to fund their retirement.”

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