Reverse mortgages can offer retirees a viable path towards having a regular cash. By creating a reliable income stream in retirement, retirees can potentially rely on sustainable income for the rest of their lives.
A study conducted by Ohio State University confirmed that 46% of retirees were motivated to seek a reverse mortgage as a way of seeking an extra income due to personal motivations such as utilizing free time and enjoying the present moment. Below, we explore why many retirees should consider a reverse mortgage.
Regular Cash Flow
Financial expert Liz Weston writes “Your expenses don’t end when your paychecks do, but creating a reliable income stream in retirement can be tricky.” However, a reverse mortgage will allow you to increase your cash flow by eliminating monthly mortgage payments.
Thanks to the reverse mortgage, retirees will be left with a regular cash flow, which is extra money in their pocket that would’ve normally gone towards paying an existing mortgage. It also gives seniors the chance to replace their cash reserves, which contributes to getting them more financially stable.
Pay Off Your Mortgage
A reverse mortgage can pay off your existing mortgage as well. It’ll give retirees the best chance to eliminate a portion of their monthly expenses and give them peace of mind knowing that they will not miss payments if an unexpected expense arises. Besides just paying off your mortgage, you could also have the extra cash you’ve accumulated go towards paying off other expenses that arise.
Protect Your Assets
A great reverse mortgage benefit for retirees involves a more secure position in the real estate market. Since most retirees are not planning to move, a reverse mortgage can help lock in home equity in the event of a declining real estate market.
It’s regularly suggested that a reverse mortgage is one of the more promising ways to protect against falling house prices. As the home is often the primary asset for homeowners – retirees especially – reverse mortgages can be the perfect way to protect against outliving your assets.
Plan for the Future
A reverse mortgage also allows borrowers to use the equity in their home to supplement the fixed retirement income for a wide variety of purposes. So, those who wish to travel or provide financial support to family members, for example, will be able to do so.
A reverse mortgage is a great way to become more financially stable, mainly by giving retirees a viable path towards having a regular cash flow. A reverse mortgage is a sure-fire way to get a sustainable income for the rest of your life.
Are you interested in discussing the ways a reverse home mortgage could work for you in retirement?
https://blogs.wsj.com/experts/2019/11/18/why-retirees-should-consider-using-reverse-mortgages/
https://www.barrons.com/articles/reverse-mortgages-retirement-planning-51552058388
