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Case Study #2

“Lots of Real Estate Equity with insufficient Income”

Challenges:

Income is far below working years causing reduced retirement lifestyle
No liquidity for emergencies, travel or health care
Do not want to sell primary home and relocate/downsize
Capital Gains issues if primary home is sold [14-25% total tax on gain over $500,000]
Insufficient Income and Liquid Assets disqualifies them to borrow money on their own home or rental property in emergency or to increase retirement income
Capital Gains on Rental sale would be 25% [depreciation recapture rules], but net income of under 3% annual on a $600,000 asset is undesirable
Not utilizing their best business partner [Uncle Sam] for tax deductions
Their Equity is earning ZERO%

Solutions:

My Retirement Coach will provide a way to safely reposition their home and rental equity to provide:

Additional income from their home equity and rental property equity to greatly enhance their retirement lifestyle for the rest of their life
The emotional security of staying in their home and avoid relocation
A safe, guaranteed Side Fund to pay monthly mortgage for the rest of their life
Renter’s will pay mortgage on rental property
Side Fund will double their effective net yield on Rental Property income
If they are insurable, an effective, tax-free strategy to effectively reduce potential large federal estate taxes [after 2011]
Excellent liquidity in safe, guaranteed Side Fund that could pay off mortgage at any time on primary home [ HOME IS PAID OFF ON PAPER! ]
Control of the Equity in home and rental property
Assurance of keeping an asset that will continue to grow over time for their heirs
NO INCREASE IN MONTHLY BUDGET EXPENSES