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Although a HELOC can provide a much-needed financial safety net, getting a line of credit on your home isn’t as easy as it was before the pandemic. For one, many large banks, including Wells

Fargo, JPMorgan Chase and Citi, stopped issuing HELOCs in 2020 because of economic uncertainty caused by the coronavirus, and they have yet to start offering them again. What’s more,

without a steady paycheck to show income, retirees often have a tougher time qualifying for loans. Even so, getting approved is doable. Retirees with solid credit scores and ample equity in

their homes can report income from sources such as pensions, Social Security, regular retirement savings withdrawals and investment income, like rental income, explains Isabel Barrow,

director of financial planning at Edelman Financial Engines. But “it may mean more hoops to jump through,” Barrow adds. ADVANTAGES OF A HELOC A HELOC is a handy personal finance tool. Here

are some ways it can help your bottom line. GIVES YOU ACCESS TO A LUMP SUM Coming up with a big chunk of money for an unexpected home repair can be a nonstarter for many retirees. The cost

of fixing the foundation can run as high as $40,000, a full roof replacement can be more than $11,000, and a new air-conditioning system can set you back $12,500, according to personal

finance app SoFi. In 2020 the average household spent $13,138 on home repairs, SoFi says. “It’s a big chunk of change,” McBride observes. “Most retirees don’t have that kind of money sitting

around.” A HELOC also gives you access to cash building up in your home without having to refinance it, which helps you avoid the higher closing costs of new mortgages. HELPS YOU AVOID

DRAINING RETIREMENT ACCOUNTS A key to financial security in your golden years is to make sure your retirement savings accounts, such as 401(k)s and IRAs, can provide the income you’ll need

for decades. One way to increase your chances of never running out of money is to avoid selling assets like stocks during market downdrafts. The reason? You’ll have fewer shares to take

advantage of an eventual market rebound.​​ That’s where the HELOC shines. “Having a HELOC can alleviate having to withdraw assets in a down market,” McBride says. Instead of having to remove

$40,000 or more from your 401(k) in a falling market to fix your home’s foundation, for example, you can get access to that big lump sum via your HELOC. “If the market falls 20 percent in

the six months after retirement, you’ll be glad you have a home equity line of credit in place,” McBride notes. “You can lean on that for a little bit, rather than pull money out of your

401(k), and give your portfolio more time to recover.”​​The big financial upside? “It doesn’t automatically bleed your retirement account,” McBride says. OFFERS TAX-SAVINGS BENEFITS Keep in

mind that if you’re older than 59 ½, any money you withdraw from a traditional 401(k) or IRA (funded with pretax dollars) is taxed at your income rate. For example, if you are in the 12

percent tax bracket, you’ll face a $4,800 estimated tax bill on the $40,000 HELOC withdrawal, which further erodes your 401(k). ​By tapping your HELOC, you avoid a financial transaction that

will trigger an income-tax event. “Instead of drawing off of your investment accounts, and possibly increasing your taxes on retirement withdrawals, or capital gains from a nonretirement

account, you can draw from your investments over time to pay back your HELOC,” Barrow says.​