Retirement Planning With The Reverse Mortgage
Retirement Planning With The Reverse Mortgage by Bob Tranchell
To start 2014 off well, I am going to do a weekly blog sharing some of the ideas and examples of how a HECM can be used in retirement planning. The first installment shows the use of a HECM to delay taking Social Security as well using a HECM as a hedge against market volatility.
Ultimately, with a Reverse Mortgage you can incorporate a dormant asset into a comprehensive financial plan that allows you to diversify your funding sources, reduce market risk, control tax liabilities and enhance your wealth.
I offer a free webinar for clients, Financial Planners, Estate Attorneys and CPAs that explores the many uses. Call me for times or to set up a webinar. 1-800-497-5235.
Delaying taking social security benefits
Social Security is for many seniors a major portion of their retirement income. The question of when to begin taking this benefit is one that perplexes. The options start at 62 with the promise of higher premiums at 67 or 70. It is estimated that 70% of Americans take their social security payments too early*. This can end up having a sustainable impact on the senior, their spouse and sometimes even their dependents.
With a reverse mortgage seniors can utilize the Credit Line option and supplement their income from years 62 to 67 or 70 and obtain maximum Social Security benefits. Once the benefits kick in they can stop utilizing the credit line and enjoy the higher monthly income from Social Security.
A Hedge Against Market Volatility
I was speaking with a client the other day who mentioned that she is drawing 10% on her retirement fund, largely because she has lost a substantial amount in the market over the past year few years. Most planners consider a 4% draw as the safest level to not risk running out of money.
When the market fluctuates it is a real problem for seniors. They do not have the luxury of sitting it out and waiting for the market to return. If they are forced to take money out when the market is down those are funds that can never be recovered by the market rising again.
Again here the use of the HECM line of credit can be effective. Instead of continuing to draw the same amount of money monthly from your 401K or IRA keep draw a monthly amount from the line of credit and wait for the market to rise again. Once your accounts have returned to their previous amounts you can suspend your use of the Line of Credit and continue to draw on your retirement fund at the proper percentage levels.
These are only two of the ideas that seniors can utilize in their retirement planning. The reverse mortgage offers a world of opportunities.
I would be happy to speak with any senior or financial planner who has questions or needs a scenario run to help them see how a reverse mortgage may be the right product to delay Social Security benefits or as a hedge against market volatility.
So Let’s Talk
The best way to get started is to talk things over. Give us a call and we’ll be happy to visit you at your convenience. Spend an hour with us and you’ll have the information you need to know if a Reverse Mortgage is right for you.
For more information online, 2013 saw many articles by Financial Planners embracing the benefits of the reverse mortgage in retirement planning.You can read the industry articles on my webpage.
http://www.thenewhecm.com/my_pages.php
Call me today to get started!
1-800-497-5235
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