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By Jason Heath, CFP on June 2, 2025
Estimated reading time: 6 minutes

By Jason Heath, CFP on June 2, 2025
Estimated reading time: 6 minutes

Real estate equity is a big part of seniors’ net worth. Some Canadian retirees may want or need to use their home’s value to help fund retirement. Here’s how.

How much of your net worth is wrapped up in your home? According to Statistics Canada, the median net worth for senior families in 2023 was $1,109,700. The most common type of asset for Canadians was a family home, with a median value of $500,000.

Since home equity makes up such a significant allocation of Canadian wealth, it is only natural to wonder how best to use this equity in retirement. Let’s look at three options for retirees: using a home equity line of credit (HELOC), taking out a reverse mortgage and selling your home.

A HELOC is a simple and flexible way to spend your home equity. You can borrow as needed up to your credit limit and pay interest only on the balance borrowed. As a secured loan, the HELOC uses your home for collateral. Secured loans typically have lower interest rates than unsecured loans (such as personal loans and credit card debt). Currently, HELOC rates in Canada are about 5% to 6%.

Many people have lines of credit during their working years and use them for various purposes. Retirees and pre-retirees may think a line of credit is a viable option for them in retirement. There are two problems with this expectation.

First, if someone wants to apply for a line of credit, they must meet the same criteria they would if applying for a mortgage. Amongst other considerations, the lender will evaluate the applicant’s borrowing capacity based on their income. Since........

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