The perfect retirement strategy?

What is the perfect retirement strategy?

The perfect retirement strategy would be to have the cost of daily living stay as fixed as our incomes. Simple, right?

Unfortunately, life doesn’t work like that.

How will you manage the rising cost of just about everything?

To manage rising costs most retirees are forced to turn to their savings. Those costs usually result in a higher withdrawal rate from your investment accounts.

The New Reverse Mortgage can mitigate the risk of portfolio depletion

Drawing from a reverse mortgage has the potential to mitigate this risk by reducing the need for portfolio withdrawals at inopportune times. Using a Reverse Mortgage to meet these higher costs can preserve greater overall legacy wealth for a given spending goal, or can otherwise sustain a higher spending amount for longer in retirement. In other words, used efficiently a Reverse Mortgage can provide not only income but help you preserve the legacy for your family.

Related: Ease the retirement squeeze

Retirement experts are recommending the New Reverse Mortgage

According to Wade Pfau, PHD, CFA “The holy grail for retirement income strategies is improved efficiency: being able to spend more while preserving a larger legacy. The synergies created by strategic use of an HECM line of credit can support a higher spending level in retirement and/or support a greater legacy value for remaining assets.”

Related: Unlocking trapped equity

For many seniors the conventional wisdom on how to treat housing wealth in retirement was to preserve it as a last resort option. If it did not need to be used, the home may be left as part of the legacy for your family.

The new take on the perfect retirement strategy

More and more seniors, financial planners and CPAs are realizing the benefit of The New Reverse Mortgage early in retirement and then strategically spending from the available credit can help improve the sustainability of retirement income strategies.

In its simplest terms if we think of our legacy value to be passed to our family as the combined value of any remaining financial assets plus the remaining home equity once the reverse mortgage loan balance has been repaid.

Related: Have you heard about the “hidden” cost of retirement?

Rather than worry about the percentage value of each asset, research reveals the possibility of sustaining a spending goal while also leaving a larger legacy at death. Strategically using home equity can lead to a more efficient strategy than the less flexible option of viewing the home as the legacy asset that must not be touched until everything else is gone.

The New Reverse Mortgage isn’t for everyone…but it could be!

How do I know if The New Reverse Mortgage is right for me?

If you’re still wondering if a Reverse Mortgage is the right solution for you but you’re not ready to sit down with one of our Reverse Mortgage Experts, then we’ll be happy to mail (or email) you Use Your Home to Stay at Home which is the official federally approved consumer booklet for those considering a reverse mortgage.

Some of this information first appeared on The Retirement Researcher and Forbes.com