SAY NO TO REFINANCING

The urge to use your house as asource of additional income, eitherthrough refinancing or a homeequity loan, may be bad for yourfuture wealth. During the 1990s,the average equity that Americanshad in their homes fell by 2%, afterany gains in price were backed out.Low equity could put you in fiscalperil if values drop and you decideto sell. The concept of "negativeequity" may then become reality—you may owe more on the housethan you can get by selling it. Homeequity is a building block of a fiscallysound retirement, too. Eliminatingmortgage payments can giveyour retirement budget a shot in thearm, and having equity in yourhome lets you explore other incomeoptions, like a reverse mortgage.