Retiring Australians & Mortgage Debt
The number of Australian retiring with mortgage debt is increasing rapidly. People are working longer, but are also dipping into their superannuation balances to clear these larger mortgage debts as they retire. The sharpest rise has been among those approaching retirement. In 1990, 15% of home owners aged 55-64 were still carrying mortgage debt. That figure is now 47%.
There two main reasons for this are:
- Property prices have risen rapidly over this period. This has resulted in a doubling of the debt to income ratio across all age categories.
- Australians are far more likely to dip into their home equity to pay for various wants and needs than they have in the past.
Between 2000 & 2010 around 500,000 Australians were forced to sell their homes due to mortgage distress.
“You make all of your money in ‘Bear Markets’, you just don’t realise it at the time” – Shelby Davis.
