Key Takeaways
- It is possible to take out a mortgage to buy a beach house in your mid-50s, but it’s essential to have a strategy to deal with repayments, especially considering retirement is on the horizon.
- Banks will want to know your exit strategy if your debt will extend beyond your working years.
- New Zealand and Australia have a Social Security Agreement, allowing citizens to use time spent living in either country to meet pension residency requirements.
- If relying on time in Australia to meet New Zealand pension requirements, you may not qualify for NZ Super until you reach the Australian age of eligibility, which is 67.
- It’s crucial to understand the ins and outs of pension eligibility when moving between countries.
Introduction to Money Matters
RNZ has launched a new podcast, ‘No Stupid Questions’, with Susan Edmunds, where listeners can ask questions about money and the economy. The podcast aims to provide answers to common queries, and listeners can submit their questions via email or voice memo. Additionally, RNZ has introduced a new money newsletter, ‘Money with Susan Edmunds’, which covers various topics related to personal finance. In this article, we will explore two common questions related to money and the economy, specifically taking out a mortgage in your mid-50s and pension eligibility when moving between countries.
Taking Out a Mortgage in Your Mid-50s
Taking out a mortgage to buy a beach house in your mid-50s may seem like a pipe dream, but it’s not entirely unrealistic. People do take on home loans in their 50s and beyond, and the key is to have a strategy to deal with repayments. According to Link Advisory head Glen Mcleod, banks will want to know your exit strategy if your debt is likely to extend beyond your working years. This means considering how you will cope with payments once you retire, whether you plan to sell the property, or if you can generate enough income from renting it out to cover the loan. If you already own your own home and have built up equity, you may be able to borrow against it to purchase the beach house. It’s essential to consult with a mortgage adviser or your bank to determine what’s possible.
Pension Eligibility When Moving Between Countries
For those who have lived in Australia and are planning to move back to New Zealand, understanding pension eligibility is crucial. A listener who has been living in Australia since 1979 and is a New Zealand citizen, but not an Australian citizen, asked about their eligibility for the New Zealand pension, also known as ‘super’. New Zealand and Australia have a Social Security Agreement, which allows citizens to use time spent living in either country to meet pension residency requirements. However, if you are relying on time in Australia to meet the requirements for the New Zealand pension, you may not qualify for NZ Super until you reach the Australian age of eligibility, which is 67. This is because the agreement requires you to meet the residency requirements of both countries, and the Australian age of eligibility is higher than New Zealand’s.
Understanding the Social Security Agreement
The Social Security Agreement between New Zealand and Australia is designed to help citizens who have lived in both countries to access pension benefits. The agreement allows you to use time spent living in either country to meet the residency requirements for the pension. However, it’s essential to understand the specifics of the agreement and how it applies to your individual situation. If you are planning to move between countries, it’s crucial to research and understand the pension eligibility requirements and how they may affect you. This includes considering the age of eligibility, residency requirements, and any potential implications for your pension entitlement.
Conclusion and Next Steps
In conclusion, taking out a mortgage in your mid-50s and understanding pension eligibility when moving between countries are complex topics that require careful consideration. It’s essential to have a strategy to deal with repayments and to understand the specifics of the Social Security Agreement between New Zealand and Australia. If you have questions about money and the economy, you can submit them to RNZ’s ‘No Stupid Questions’ podcast or sign up for the ‘Money with Susan Edmunds’ newsletter. By staying informed and seeking advice from experts, you can make informed decisions about your financial future and ensure that you are prepared for the challenges and opportunities that lie ahead.