Is a Reverse Mortgage a Good Option for You?
The 2008 recession affected a significant number of people in America. According to a recent article the average loss in the year 2008 for workers who had been on the job for 20 years was about 25 percent. Although, the government has claimed that the economy has improved and retirement balances are in better shape, unfortunately this may not be the case. If you are a senior citizen struggling to manage your finances and looking for a good option for supplementary income, a reverse mortgage in Illinois could be your best option.
An author and professor of economic policy analysis at The New School for Social Research in NY, Teresa Ghilarducci, and her colleague, Joelle Saad-Lessler have conducted a deeper study of federal government data particularly the performance of retirement accounts for both male and female workers who were aged between 51-59 in 2009. During the study they found that though average retirement account balances have increased the workers saw a sizeable decrease in their account balances for a couple of years. They also found that even when the economy finally started looking up the average gain was much smaller than what would have been needed to recover from the significant losses in 2008.
So findings of the study indicate that most of the citizens in our country aged between 55 and 64 in 2012, 4.3 million will be poor or near poor by the time they’re 65 and if there is no improvement in the situation then in the next decade, the number of poor or near-poor senior citizens will increase by 146 percent¹.
As we have already mentioned if your investment portfolios are in bad shape due to the impact of the Great Recession a reverse mortgage can be a good option. This mortgage helps seniors get cash in return for the equity of their home which are tax free² and will not involve any monthly mortgage payments³.
1. Here is the link to the study and the findings by Teresa Ghilarducci, 10/16/15:
2. It is always better to consult the financial advisor and concerned government agencies for any effect on taxes or government benefits if you opt for a reverse mortgage.
3. Some exemptions are only applicable if you are seeking a reverse mortgage on the home which is your primary residence and you continue to pay required property taxes, homeowners insurance and maintain the home according to Federal Housing Administration requirements.