Using a Reverse Mortgage as a financial planning tool may help provide for a more worry-free and comfortable retirement. As you are nearing retirement or are currently retired, your financial plans may not have worked out as well as you would have wished. Of course, you constantly hear that you should have your mortgage paid off before retiring and you had every intention of that happening or you may have not have saved enough for retirement because life typically gets in the way. And you may be thinking that you will have to work longer than expected or go back to work. The U.S. Housing and Urban Development (HUD) allowed the Federal Housing Administration (FHA) to insure reverse mortgages to make sure that seniors have another viable option to them for retirement. A reverse mortgage may be the answer you are looking for because this financial tool will allow you to retire when you want too and not have to go back to work at a later time during your ‘golden years’.As people are continually living longer, they must plan financially to make sure their money outlives them, instead of outliving their money. As pension plans get cut down or eliminated and as other expenses arise, seniors are now forced to look at other options available to them. Some have gone back to work to make ends meet, while others have cut their expenses so significantly that they can no longer enjoy their retirement years. Many seniors are sitting on a gold mine and may not even realize it.
Seniors that either own their home outright or even if they do have a mortgage on the home can look towards a reverse mortgage to solve their financial problems. If you currently have a mortgage on your home and you would like to get rid of that monthly mortgage payment, a reverse mortgage can do that. Also, if you have paid off or paid down your mortgage enough, you can use your home equity as income for the rest of your life. There are many different options that seniors have when looking at a reverse mortgage.
For example, if you are 70 years old and the value of your home is $200,000, but the mortgage owed on it is still $50,000, a reverse mortgage can help. As one of the options you would have is the monthly mortgage payment would stop and you could start receiving a monthly payout of $374 for the rest of your life, tax-free. If your monthly payment was $600 a month, then with the elimination of that payment and the extra $374 a month you are receiving, then that would be a net increase of almost $1,000 a month or close to $12,000 a year, tax-free. This is just one example that would be available, there are many different options and combinations to choose from when considering a reverse mortgage.
Most seniors 62 years and older may have not even thought about or looked into what a reverse mortgage may be able to do for them.
Reverse Mortgage as a Financial Planning Tool
![Reverse Mortgage as a Financial Planning Tool]()
Reviewed by Merlyn Rosell
Published :
Rating : 4.5
Published :
Rating : 4.5