Americans faced with not having saved enough for retirement may have to get creative to increase cash flow and shore up their funds. And one such creative solution that can help retirees is the prospect of getting a reverse mortgage, says an article from Houston’s Chron.com.
Nearly 30% of households with members age 55 or older have neither retirement savings nor a traditional pension plan, according to an analysis by the Government Accountability Office (GAO). And for those who do have savings for retirement, their nest eggs are small, as GAO finds the median amount of those savings is about $104,000 for age 55-64 households, and $148,000 for age 65-74 households.
To aid in enduring this retirement shortfall, Chron.com suggests retirees should consider a number of options to provide cash flow, including working part-time, delaying retirement altogether, cashing out stock options from an employer and developing multiple income streams.
Reverse mortgage are also a possibility, says David Nguyen, a Houston certified public accountant.
“If you own a house and have a large amount of equity, there’s a lot of flexibility to use it,” Nguyen said in the Chron.com article. “There are drawbacks to it with fees here and there. The nice thing is you don’t have to move out of your house and you can access the money for anything.”
Nguyen adds that “extensive research is encouraged” with reverse mortgages, and that qualifying homeowners must not have delinquent federal debt, but have the financial resources to pay for upkeep, taxes and insurance on the home.
“You have to work within your means to have enough to sustain your lifestyle and not outlive your funds,” he said. “You need a good analysis of cash flow especially at retirement to see where you want to be. A lot of people have different goals.”
Read the Chron.com article.
Written by Jason Oliva
