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Reverse Mortgage as a Retirement Planning Tool

More and more financial planners, including Nobel Laureate economist and M.I.T. professor Robert Merton, are suggesting reverse mortgages to address:

  • Declining income on retirement with continued mortgage payments;
  • Income replacement to delay drawing Social Security until age 65;
  • Supplement low or moderate Social Security income;
  • Reduce fear or uncertainty retirement funds might run out;
  • Protect against sudden decline in income;
  • Purchase home with no mortgage payment (property taxes and insurance must still be paid);
  • Source of funds for occasional or unforeseen expenses.

A financial planning industry article can be found here:

Standby Reverse Mortgages: A Risk Management Took for Retirement Distributions

You should always consult with a financial, legal, or tax planner for details specific to your situation.