Provided you meet the requirements, a reverse mortgage can put a lot of money in your pocket. Here’s how to spend it wisely.
A Child’s Wedding
The average wedding can cost $40,000. While it’s tempting to do something extravagant like this for your child, before you go and spend the bulk of your payout on something such as this, it’s more advised that you tackle any high interest debt that you’ve accrued or pay off a car or other big bill that can hinder your budget.
Who doesn’t love shopping? But in the real world, your bills should come first. It’s better advice to set aside the funds from your reverse mortgage payout so that you can secure your lifestyle for many years to come and enjoy a happier, more financially secure retirement.
If you are going to invest the funds from your payout into anything, make sure it’s something that you can earn appreciation on in the long term. While tempting, fickle things that depreciate won’t do much to help you retain value and won’t help you secure your retirement, either.
Plausible Spending Dos:
There are plenty of things that you can wisely spend your reverse mortgage payout on, too. Here are a few candid examples.
- Home remodel – A great way to invest your reverse mortgage funds is by remodeling your home. This improves your quality of living as well as your home’s value, making it a win-win situation.
- Medical bills – If you are sitting on a lot of medical bills, a great way to pay them off is by using your reverse mortgage funds. It frees up a lot of debt and helps reduce monthly obligations.
- High interest debt – Applying your reverse mortgage payout to any high interest debt can help you reduce your monthly bills while also saving you thousands of dollars on interest and fees.
- Savings nest egg – A smart way to plan for the future is by stashing your payout in your savings account just in case. It never hurts to have a retirement nest egg at your fingertips.