REVERSE MORTGAGE INFORMATION
Women Are More Likely to Face Financial
Hardships in Retirement
It’s a fact that women, on average, live longer than men and living longer means the cost of
retirement will be greater. However, living longer does not have to mean living poorer or even
running out of money; a reverse mortgage may be structured to provide an income for life.
According to a report by the Society of Actuaries, the average life expectancy at age 65 is 17
years for men and 20 years for women. Of even greater consequence is that women are more
likely than men to be widowed, divorced or never married. For example: between the ages of 75
and 84, 65 percent of women and only 28 percent of men will live alone.
Because women have traditionally been younger than their spouses, women will be widowed 15
years or more. The death of a spouse can bring an unexpected loss in income support that is not
fully offset by a decrease in expenses. Although Social Security is a guaranteed benefit to
widows, it can decrease by as much as one-third upon a husband’s death. Pension benefits may
also be reduced, often by half, or payments may stop entirely. Needless to say, living and health
expenses typically do not decrease nearly as much. Also, a widow will have the added cost of
paying for jobs the husband performed such as house repairs and yard work.
A source of financial answers for women who have retired or are planning their retirement is the
Women’s Institute For A Secure Retirement (WISER). They provide a number of publications
and resources that improve financial security for women. WISER may be reached at
202-393-5452 or by visiting their website at www.wiserwomen.org.
One of the financial tools that WISER provides information about is the reverse mortgage. It is
growing in popularity especially among retired women. In the latest statistics from the
Department of Housing and Urban Development (HUD), 48 percent of reverse mortgages have
been taken out by women, 16 percent by men, and 36 percent by couples.
The reverse mortgage enables homeowners 62 and older to borrow against their home with no
repayment for as long as they live in their home. A reverse mortgage does not affect Social
Security or Medicare Benefits, and credit and income are not used in qualifying. Costs associated
with taking out a reverse mortgage are financed so there is usually no money out of pocket.
Reverse mortgages are a non-recourse loan which means that the lender can only look to the sale
of the home for repayment when the homeowner dies or moves, and not to other assets or the
income or assets from family members.
With four ways to receive funds from a reverse mortgage, we are able to help our senior clients
customize their reverse mortgage to meet their specific needs. By setting some of the reverse mortgage funds aside, our clients may ensure that they are able to leave an inheritance to their family.
Although the average age to take out a reverse mortgage is 74, younger women who would like
to stop working are discovering that they are able to retire by taking out a reverse mortgage for
immediate income, and delay their Social Security Benefits until age 70 so they may receive
higher monthly benefits.
It is a good idea to check with the Social Security Administration to discover how different retirement ages will change your benefit. Contact the SSA by calling 800-772-1213 or go online to www.ssa.gov.
retirement will be greater. However, living longer does not have to mean living poorer or even
running out of money; a reverse mortgage may be structured to provide an income for life.
According to a report by the Society of Actuaries, the average life expectancy at age 65 is 17
years for men and 20 years for women. Of even greater consequence is that women are more
likely than men to be widowed, divorced or never married. For example: between the ages of 75
and 84, 65 percent of women and only 28 percent of men will live alone.
Because women have traditionally been younger than their spouses, women will be widowed 15
years or more. The death of a spouse can bring an unexpected loss in income support that is not
fully offset by a decrease in expenses. Although Social Security is a guaranteed benefit to
widows, it can decrease by as much as one-third upon a husband’s death. Pension benefits may
also be reduced, often by half, or payments may stop entirely. Needless to say, living and health
expenses typically do not decrease nearly as much. Also, a widow will have the added cost of
paying for jobs the husband performed such as house repairs and yard work.
A source of financial answers for women who have retired or are planning their retirement is the
Women’s Institute For A Secure Retirement (WISER). They provide a number of publications
and resources that improve financial security for women. WISER may be reached at
202-393-5452 or by visiting their website at www.wiserwomen.org.
One of the financial tools that WISER provides information about is the reverse mortgage. It is
growing in popularity especially among retired women. In the latest statistics from the
Department of Housing and Urban Development (HUD), 48 percent of reverse mortgages have
been taken out by women, 16 percent by men, and 36 percent by couples.
The reverse mortgage enables homeowners 62 and older to borrow against their home with no
repayment for as long as they live in their home. A reverse mortgage does not affect Social
Security or Medicare Benefits, and credit and income are not used in qualifying. Costs associated
with taking out a reverse mortgage are financed so there is usually no money out of pocket.
Reverse mortgages are a non-recourse loan which means that the lender can only look to the sale
of the home for repayment when the homeowner dies or moves, and not to other assets or the
income or assets from family members.
With four ways to receive funds from a reverse mortgage, we are able to help our senior clients
customize their reverse mortgage to meet their specific needs. By setting some of the reverse mortgage funds aside, our clients may ensure that they are able to leave an inheritance to their family.
Although the average age to take out a reverse mortgage is 74, younger women who would like
to stop working are discovering that they are able to retire by taking out a reverse mortgage for
immediate income, and delay their Social Security Benefits until age 70 so they may receive
higher monthly benefits.
It is a good idea to check with the Social Security Administration to discover how different retirement ages will change your benefit. Contact the SSA by calling 800-772-1213 or go online to www.ssa.gov.