Do You Have Enough Financial Security For Your Retirement?

As a Reverse Mortgage Professional, I’m constantly looking at the industry numbers and trends to better understand the market and to better serve my clients.  I came across an interesting article from Ben Walsh at the Huffington Post entitled Americans Are Not Remotely Financially Ready For Retirement.

Here are some interesting facts to note in the article:

  • Net worth for the middle 20 percent of soon-to-be-retired Americans has fallen every year since 2004, and it is now just under $170,000.
  • Net worth for the middle 20 percent of soon-to-be-retired Americans has fallen every year since 2004, and it is now just under $170,000.

This paints an interesting and perhaps daunting landscape for those retiring or thinking of retiring.  What got me was the last sentence of the article which says: “Homeownership should not be a retirement plan.”

I disagree and here’s why:

A lot of net worth is tied to your home and if you have equity in your home, you should consider using this as a tool to help you enjoy retirement.  If other funds are tapped out to help you in your retirement and you need some financial support to help get by, you may want to consider the following options:

  1. Sell your home for a decent profit and downsize to a retirement community or a smaller apartment or condo.
  2. Consider getting reverse mortgage to help with monthly payments. One of the cool things about a reverse mortgage is that homeowners can use their equity to receive a lump sum of cash or get tenure payments for as long as they live in their home.  And homeowners are not required to make mortgage payments.  Why make a payment every month when you can keep that money and use it for whatever you want. So many seniors have worked hard to gain equity and there is no better time to make your equity work for you.

A reverse mortgage pays you your equity as tax free cash. With a reverse mortgage not only do you get to save the money you would normally use to make your monthly mortgage payment but you also can receive monthly payments from your proceeds. Reverse mortgage proceeds are tax free and do not effect social security or medicare. They are a great way to pay for in home care, early inheritance, Grandkids college or a trip around the world. Literally anything. More and more financial planners are utilizing the reverse mortgage as an investment tool for additional capital without drawing down investments. The best way to find out more is to call today.