Should Women Consider Reverse Mortgage As An Option

financial-planning-retirementIf you are a single woman, you may have greater “longevity risk” than the average couple or a single man1 Women who are widowed, divorced or never married may have greater financial planning needs as women tend to live longer than men and generally have less money to do so.

In fact, according to Elder Issues Inc., 7 out of 10 baby boomer women will outlive their spouses.2

This is generally due to the fact that women have a longer average life expectancy than men and tend to marry men older than themselves. Everyone, especially single women, should obtain a full financial assessment that includes looking over investments, insurance, financial goals and estate planning.1

If you or someone you know is concerned about the state of their financial health, consider the following ideas.

Hire a professional Women are often more receptive to professional guidance than men. Hire a professional financial planner that you trust and come up with a game plan that you’re both comfortable with.

Evaluate a deferred fixed annuity option when interest rates are high A deferred fixed annuity requires that you put money down now and receive it back later as returned principal and interest for the rest of your life. The fixed annuity locks in the rate and is more appealing when interest rates are higher.

Plan for longevity How long does your financial retirement plan last? Will you run out of funds by the time you turn 70? 85? 95? Women still need to be reasonably aggressive in their investments well into their 70s if they believe they may still have another 25 years or more that they will need to live on those funds. Having a well-rounded portfolio later in life can help women remain financially independent well into retirement.

Move If you live in an expensive area of the country, consider moving to a more budget-friendly locale. This is especially beneficial if you can move closer to family or friends. It might even be wise to move out of the country if you and your financial planner have researched all of the options. If moving to a different city isn’t an option, consider right sizing to a smaller home or a condo. Not only will you save on a mortgage payment, but utilities and taxes will likely be less expensive.

Consider a reverse mortgage loan If most of your net worth is wrapped up in your home, a reverse mortgage could be the ideal situation for you. A reverse mortgage loan allows seniors age 62 and older to access a portion of the equity in their homes. Not only will you not have to make any mortgage payments, but you can use the loan proceeds however you want. You will still be responsible for the upkeep and property taxes and insurance. However, if your home is a place you can safely grow old in, and you could see yourself living there for years to come, a reverse mortgage may be the right option for you.

A reverse mortgage loan may not be suitable for everyone. However, for many it can offer a supplemental source of income and provide a financial safety net throughout your retirement years. For more information about reverse mortgage loans, call a reverse mortgage loan advisor at 866.751.6105.