Home Equity
The portion of your home's value you actually own — market value minus the mortgage balance.
Home equity is your home's current market value minus what you still owe on it. It grows as you pay down the mortgage and as the property appreciates, and it's often a household's largest single asset.
In retirement planning, equity is real wealth but illiquid — it doesn't pay the grocery bill without selling, downsizing, or borrowing against it (through a HELOC or reverse mortgage). That's why planners often track liquid or investable net worth separately, excluding the home. Home equity is a backstop and an option, not spendable income, unless you take deliberate steps to tap it.
This definition is general information to help you understand a term, not financial, tax, or legal advice. Figures that change year to year (limits, thresholds, rates) should be confirmed against current official sources. For guidance on your situation, a licensed fee-only fiduciary is the right next step.