Reverse Mortgage Loan Advisors

Will I Outlive My Money? Consider This Retirement Strategy

if-you-are-worried-about-outliving-your-money-then-consider-a-reverse-mortgage-as-one-of-your-retirement-strategies

Will I outlive my money? This is a question often pondered by people of all ages. However, this is an extremely relevant question that people in the 50 to 80 year old age bucket should be asking themselves.

Will I Outlive My Money? Consider This Retirement Strategy
Will I Outlive My Money? Consider This Retirement Strategy

Are you a also homeowner that has a free and clear home? Or, an almost free and clear home?

If any of this describes you or a loved one, you may want to consider this retirement strategy.

More questions? Want a free info kit? Contact us  Info@ReverseMortgageLoanAdvisors.com or call (714) 271-8524

Average Life Expectancy In US & Average Retirement Savings

According to an October 2017 study by the Center for Retirement Research the median retirement account balance for those aged 55-64 was just $104,000. The chart below shows the average retirement savings for other age buckets as well.

Average Retirement Savings Balance By Age:

Age Group401(k)/IRA Balance
35 – 44$37,000
45 – 54$80,000
55 – 64$104,000

At the same time, the average life expectancy in America for 2019 was 78.87 years of age. For a 62 year old, that $104,000 would have to be spread over almost 17 years if that 62 year old lived an average lifespan. That only provides them about $6117 per year of usable funds (not counting any earnings or losses due to market conditions). And of course the numbers are even bleaker for those that live longer than average.

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More questions? Want a free info kit? Contact us  Info@ReverseMortgageLoanAdvisors.com or call (714) 271-8524

A Reverse Mortgage as One of Your Retirement Strategies

An often overlooked retirement strategy is the use of a reverse mortgage. As a reverse mortgage advisor, we often speak to people that opt against doing a reverse mortgage. Many times stating things like”I don’t need it” or “I’ll do it later when I need it”. Often times it’s folks that have their home paid off that tend to make statements like that.

Here is one of the greatest things about a reverse mortgage. The unused credit you have actually grows over time. A person with a free and clear home can take out a stand by line of credit at age 62. That stand by line of credit (aka HECM line of credit) will grow over the course of time thereby providing you with MORE accessible money when you need it. The amount it grows depends on the interest rate, but based on current market conditions, we’ll use a growth rate of 4.2% for the coming examples. Also, in regard to the Reverse Mortgage Line of credit, it’s guaranteed for as long as you live or for as long as you live in your home. PLUS, you don’t have to make a payment on the loan for as long as you live or as long as you live in your home.

More questions? Want a free info kit? Contact us  Info@ReverseMortgageLoanAdvisors.com or call (714) 271-8524

Here’s an example along with an amortization table showing how much a person would have access to if they did a reverse mortgage standby line of credit at age 62. In this example we’re using a home value of $600,000 and a free and clear home. Your unused line of credit grows at whatever your initial interest rate is PLUS another .5%. In this case, the growth rate is 4.219%.

As you can see, if you did this at age 62 you’d have a line of credit of $272,948. If you didn’t touch that line of credit until you were age 72, you’d have access to $426,431. If you waiting until you were 82, you’d have access to $637,149 in your line of credit. And, at age 91 you’d have access to $995,428.

You may never need it, but if you do you can rest easy knowing it’s there.

A Reverse Mortgage As One of Your Retirement Strategies
A Reverse Mortgage As One of Your Retirement Strategies

Reverse Mortgage Basics

  • Can be done at age 62+ (in some states there are reverse mortgage programs for 60 and 61 year olds).
  • No payment for as long as you live of for as long as you live in your home.
  • You still own your home.
  • Use the money however you wish.
  • You’re still leave your home to your kids (or whomever you wish).
  • Insured and guaranteed by FHA / HUD.

Smart people anticipate the unexpected. Most folks also realize that WE really don’t know when the man upstairs is going to take us home. Even if you don’t NEED or WANT money right now during the early years of retirement, it’s easy to see that a reverse mortgage stand by line of credit could a hugely beneficial financial tool. It’s certain to HELP eliminate the possibility that you’ll outlive your money. It’s a nice option to have, even if you never end up using it. And, if you’re worried about the initial balance created by closing costs, then you can always make interest only payments to keep the balance low and prevent it from compounding.

More questions? Want a free info kit? Contact us  Info@ReverseMortgageLoanAdvisors.com or call (714) 271-8524

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