>the average older boomer whose wealth is embedded in their home isn't selling. Its notional wealth, not actually liquid invested wealth
I'm not American but in my country a lot of boomers have been able to retire early, travel and buy expensive cars by taking out very favorable loans by using their home value increase as collateral.
Let's say they bought their home at 1 million Danish krones and the house is now worth 4 million. They can use the valuation increase to pay out any remaining debt in the house and put up collateral for loans to retire early, travel and buy expensive cars.
They're spending the kids inheritance. Intergenerational wealth issues around this. Most pension and superannuation systems were designed to drain to zero near death. Now, people traded them up to be income streams, are living longer and will vest middle aged kids with a lump sum inheritance. It's not "wrong" in law but it's not what was intended by pensions
If they retire early (meaning no more income from work), how do they pay off the new mortgage every month? Do they just pay back using the sum they got from the mortgage loan? What's the point then?
I'm not American but in my country a lot of boomers have been able to retire early, travel and buy expensive cars by taking out very favorable loans by using their home value increase as collateral.
Let's say they bought their home at 1 million Danish krones and the house is now worth 4 million. They can use the valuation increase to pay out any remaining debt in the house and put up collateral for loans to retire early, travel and buy expensive cars.
I'm 99% sure the same is possible in the US.