Friday , April 19 2019
Home / Money / The Lack Of Retirement Savings Means You Should Consider A Reverse Mortgage
Retirement Savings

The Lack Of Retirement Savings Means You Should Consider A Reverse Mortgage

With retirement savings not nearly enough to live on, opting for a reverse mortgage almost becomes imperative.

America’s retirement savings news is grim.

Half of workers in the US are at risk of not maintaining their standard of living when they retire. Some 48 percent of those 55 to 64 don’t have a 401(k) or IRA and those who do only have $111,000 stashed away on average. That comes to $500 a month when it’s annuitized, according to research from the Center For Retirement Research at Boston College. When you factor it among the entire age group, the average household has $40,000 in retirement funds in 401(k) and IRAs.

That means people nearing retirement are either going to have to work longer or cut back on their lifestyle when they stop working. If they’re going to any kind of comfort in retirement, they’re either going to have to sell their home and downsize or take out a reverse mortgage.

“Our concern that $500 a month paired with your Social Security benefit is not going to be enough for many households to retain their pre-retirement standard of living,” says Andy Eschtruth, the communications director of the center that regularly reports on the state of American retirement. “We know that these households have very little money in financial assets outside of IRAs and a 401(k). You can’t save more because it’s too late for that for them. The only option is cutting back on consumption and changing your expectations of what kind of lifestyle you can have when you retire. Maybe, you won’t be able to do some things you hoped to do.”

The numbers are even worse because the Boston College researchers factor in people drawing from their home equity just to come up with the number that half of the workers are at risk of not maintaining their standard of living in retirement. Without income from a reverse mortgage or selling the homes to get a smaller one, the percentage is even greater.

“We think that they should definitely considering tapping into their home equity in retirement and a reverse mortgage is one way to do that,” Eschtruth says. “The general feeling of the research team at the center is that reverse mortgages is something that should get a more serious look from people because they aren’t going to find the resources in other places. They’re not going to have enough piecing together Social Security with their 401(k) savings. Looking at their home equity is a reasonable way for many people to maintain their standard of living in retirement.”

Eschtruth says that while many Americans have housing equity, they don’t tend to have reverse mortgages. It’s uncommon for people to secure because many are reluctant to do that.

Under a reverse mortgage the borrower, who must be at least 62, can tap into their home equity. The loan isn’t repaid until the borrower moves or dies.

“They want to leave their homes to their kids or hold it as an emergency asset,” Eschtruth says. “Some don’t like the idea of feeling like they’re back in debt because they spent their life paying off their mortgage. Our view is that a reverse mortgage is a big asset for many people and it’s going to be increasingly hard to ignore in retirement.”

The amount of income from 401(k) plans and IRAs at $111,000 for those 55-64 that have them is down from 2010, and Eschtruth says there’s no indication that trend is changing despite gains in the stock market. That group is in worse shape than those 65 to 74 that have $149,000 in 401(k) and IRA assets for their retirement, Eschtruth says. That group is also better off because they’re more likely to have traditional company pensions as well than younger generations that have had to rely on voluntary contributions matched by employers if they even offered a 401(k) plan.

“The news for today’s retirees is different than when people were retiring during the golden age when people had more traditional pensions—the golden age is certainly coming to an end,” Eschtruth says.

Eschtruth says the hope is that more companies will go into auto enrollment programs where workers are automatically signed up for 401(k) plans unless they opt out of them. Many people don’t have them simply because of inertia in that they don’t get around to doing it, he says. That translates into 20 percent of people with access to plans not signing up for them, he says.

“What we found through auto enrollment, if the decision is made by the company for you, you still get by on what you have,” Eschtruth says. “People tend to get by on what they have coming to them in their paycheck. They find they can save when they thought they couldn’t. “

Eschtruth says people need to realize that the world has shifted and it now places more risk and responsibility on them to prepare for their own retirement. Not everyone is getting that message.

“My concern is that people may not have fully realized that still and that the sooner they do the better because they’ll have to take some actions on their own to make sure their retirement will be what they’re anticipating it will be,” Eschtruth says. “What we’re concerned is people will get to retirement and find they’re not in the shape they thought they would be. They’ll realize that either they retired too early or they didn’t save enough.”

Check Also

Reverse Mortgage pros

5 Upsides To An HECM Reverse Mortgage

As you near your golden years, the last thing that you want to have to ...


  1. It?¦s really a cool and useful piece of info. I?¦m satisfied that you simply shared this useful info with us. Please keep us up to date like this. Thank you for sharing.

  2. You are a very smart individual!

  3. As a Newbie, I am continuously exploring online for articles that can aid me. Thank you

  4. Those are yours alright! . We at least need to get these people stealing images to start blogging! They probably just did a image search and grabbed them. They look good though!

  5. Yeah bookmaking this wasn’t a risky conclusion great post! .

  6. There is apparently a lot to identify about this. I feel you made certain nice points in features also.

  7. Some truly nice stuff on this site, I like it.

  8. Enjoyed examining this, very good stuff, thanks.

  9. Hello my friend! I wish to say that this post is amazing, great written and include almost all vital infos. I?¦d like to look extra posts like this .

  10. There are some fascinating deadlines in this article but I don’t know if I see all of them middle to heart. There may be some validity but I will take maintain opinion till I look into it further. Good article , thanks and we would like more! Added to FeedBurner as effectively

  11. you are actually a excellent webmaster. The website loading pace is incredible. It seems that you are doing any unique trick. In addition, The contents are masterwork. you’ve performed a wonderful task on this topic!

  12. You have mentioned very interesting details! ps decent web site.

  13. I visited a lot of website but I think this one has got something special in it in it

  14. Enjoyed looking at this, very good stuff, regards. “Love begets love, love knows no rules, this is the same for all.” by Virgil.

  15. Would you be considering exchanging hyperlinks?

  16. Hi there, just changed into aware of your weblog thru Google, and located that it is really informative. I am going to watch out for brussels. I’ll appreciate for those who proceed this in future. Lots of other people will be benefited from your writing. Cheers!

  17. Hello my family member! I want to say that this post is awesome, great written and include approximately all significant infos. I?¦d like to see extra posts like this .

  18. Hello There. I found your blog using msn. This is an extremely well written article. I will be sure to bookmark it and come back to read more of your useful information. Thanks for the post. I’ll definitely comeback.

  19. Thank you so much for giving everyone an extremely spectacular possiblity to read articles and blog posts from this site. It is always so fantastic and packed with fun for me personally and my office mates to search the blog the equivalent of three times in one week to learn the fresh tips you will have. And of course, I’m so usually satisfied for the splendid strategies served by you. Certain 3 areas in this article are without a doubt the most effective we have all ever had.

  20. F*ckin’ tremendous things here. I’m very satisfied to look your post. Thanks so much and i am having a look ahead to contact you. Will you please drop me a mail?

  21. What i don’t realize is if truth be told how you are not really much more smartly-liked than you may be now. You are very intelligent. You know therefore considerably in terms of this subject, made me in my opinion believe it from a lot of numerous angles. Its like women and men aren’t interested unless it’s one thing to accomplish with Woman gaga! Your personal stuffs great. All the time maintain it up!

  22. I have recently started a website, the info you offer on this web site has helped me tremendously. Thanks for all of your time & work.

  23. Wow, amazing weblog format! How long have you ever been blogging for? you made blogging look easy. The overall glance of your web site is excellent, let alone the content material!

  24. Very interesting info !Perfect just what I was looking for!

  25. Excellent goods from you, man. I have understand your stuff previous to and you are just too great. I actually like what you have acquired here, certainly like what you’re stating and the way in which you say it. You make it enjoyable and you still care for to keep it wise. I cant wait to read much more from you. This is really a wonderful website.

  26. hello there and thank you for your info – I’ve definitely picked up something new from right here. I did however expertise a few technical points using this web site, since I experienced to reload the site many times previous to I could get it to load correctly. I had been wondering if your web host is OK? Not that I’m complaining, but sluggish loading instances times will sometimes affect your placement in google and could damage your high quality score if ads and marketing with Adwords. Anyway I am adding this RSS to my email and can look out for a lot more of your respective fascinating content. Make sure you update this again soon..

  27. I believe this site has some real excellent info for everyone : D.

  28. I have been surfing online more than 3 hours today, yet I never found any interesting article like yours. It’s pretty worth enough for me. In my opinion, if all webmasters and bloggers made good content as you did, the net will be a lot more useful than ever before.

  29. Somebody essentially help to make critically articles I might state. That is the very first time I frequented your web page and to this point? I amazed with the analysis you made to make this actual post amazing. Magnificent task!

  30. This is the appropriate weblog for anybody who wants to search out out about this topic. You realize a lot its almost laborious to argue with you (not that I actually would need…HaHa). You positively put a new spin on a topic thats been written about for years. Great stuff, just nice!

  31. Unquestionably imagine that which you said. Your favorite justification seemed to be on the net the simplest thing to remember of. I say to you, I definitely get annoyed whilst other folks think about worries that they plainly do not recognise about. You managed to hit the nail upon the highest and defined out the whole thing with no need side effect , folks could take a signal. Will likely be back to get more. Thanks

  32. Heya i am for the primary time here. I found this board and I find It truly helpful & it helped me out much. I hope to offer one thing back and aid others such as you helped me.

  33. Hey there would you mind stating which blog platform you’re working with? I’m going to start my own blog in the near future but I’m having a hard time choosing between BlogEngine/Wordpress/B2evolution and Drupal. The reason I ask is because your design and style seems different then most blogs and I’m looking for something unique. P.S My apologies for being off-topic but I had to ask!

  34. When I originally commented I clicked the “Notify me when new comments are added” checkbox and now each time a comment is added I get four emails with the same comment. Is there any way you can remove me from that service? Appreciate it!

  35. Fantastic items from you, man. I’ve keep in mind your stuff previous to and you are just extremely excellent. I actually like what you’ve obtained right here, really like what you are saying and the way in which through which you are saying it. You’re making it enjoyable and you still care for to stay it wise. I can not wait to learn far more from you. This is actually a wonderful site.

  36. I like this website because so much utile material on here : D.

  37. You made some good points there. I did a search on the subject and found most individuals will agree with your website.

  38. hello!,I like your writing very much! share we communicate more about your post on AOL? I require a specialist on this area to solve my problem. May be that’s you! Looking forward to see you.

  39. I just couldn’t depart your site prior to suggesting that I really enjoyed the standard info a person provide for your visitors? Is gonna be back often to check up on new posts

  40. you will have a terrific weblog right here! would you wish to make some invite posts on my blog?

  41. Some genuinely choice content on this web site, bookmarked.

  42. I am glad to be a visitor of this double dyed site! , thanks for this rare info ! .

  43. A formidable share, I just given this onto a colleague who was doing somewhat analysis on this. And he actually purchased me breakfast as a result of I discovered it for him.. smile. So let me reword that: Thnx for the treat! However yeah Thnkx for spending the time to discuss this, I really feel strongly about it and love studying more on this topic. If potential, as you become experience, would you mind updating your blog with extra details? It’s extremely useful for me. Huge thumb up for this weblog post!

  44. Howdy would you mind letting me know which web host you’re working with? I’ve loaded your blog in 3 different browsers and I must say this blog loads a lot faster then most. Can you recommend a good web hosting provider at a reasonable price? Many thanks, I appreciate it!

  45. I conceive other website owners should take this site as an example , very clean and great user friendly style.

  46. Hi there, You have performed a great job. I will certainly digg it and in my view recommend to my friends. I’m confident they’ll be benefited from this website.

  47. Good write-up, I am regular visitor of one’s blog, maintain up the excellent operate, and It’s going to be a regular visitor for a lengthy time.

  48. Lovely blog! I am loving it!! Will be back later to read some more. I am taking your feeds also

  49. This is the reasoon you want to start using Neuroscientia – an educational repository of cognitive health tutorials and powerful brainy tips for learning, IQ and mental flow. What do you think?

  50. Thanks a lot for sharing this with all people you actually recognise what you’re talking approximately! Bookmarked. Kindly also seek advice from my web site =). We could have a hyperlink trade arrangement between us!

  51. As I site possessor I believe the content material here is rattling wonderful , appreciate it for your efforts. You should keep it up forever! Best of luck.

  52. I’m so happy to read this. This is the kind of manual that needs to be given and not the accidental misinformation that is at the other blogs. Appreciate your sharing this greatest doc.

  53. The other day, while I was at work, my cousin stole my iphone and tested to see if it can survive a 40 foot drop, just so she can be a youtube sensation. My iPad is now broken and she has 83 views. I know this is entirely off topic but I had to share it with someone!

  54. Fantastic beat ! I wish to apprentice while you amend your web site, how could i subscribe for a blog site? The account helped me a acceptable deal. I had been a little bit acquainted of this your broadcast provided bright clear idea

  55. I like this post, enjoyed this one thanks for posting. “‘I have done my best.’ That is about all the philosophy of living one needs.” by Lin Yutang.

  56. Some truly fantastic content on this web site, regards for contribution.

  57. Thanks for some other wonderful post. The place else may anybody get that kind of information in such a perfect way of writing? I’ve a presentation subsequent week, and I’m at the look for such info.

  58. I really enjoy looking at on this web site, it holds fantastic posts. “One doesn’t discover new lands without consenting to lose sight of the shore for a very long time.” by Andre Gide.

  59. Wohh precisely what I was searching for, appreciate it for putting up.

  60. Very interesting info !Perfect just what I was looking for! “I have great faith in fools — self confidence my friends call it.” by Edgar Allan Poe.

  61. Everything is very open and very clear explanation of issues. was truly information. Your website is very useful. Thanks for sharing.

  62. Very interesting topic, appreciate it for posting. “I am convinced that life in a physical body is meant to be an ecstatic experience.” by Shakti Gawain.

  63. I haven’t checked in here for some time since I thought it was getting boring, but the last few posts are good quality so I guess I’ll add you back to my everyday bloglist. You deserve it my friend 🙂

  64. You can definitely see your expertise within the paintings you write. The sector hopes for more passionate writers such as you who are not afraid to mention how they believe. At all times go after your heart.

  65. It’s arduous to find knowledgeable people on this subject, however you sound like you understand what you’re talking about! Thanks

  66. You have remarked very interesting details! ps decent web site. “Hares can gamble over the body of a dead lion.” by Publilius Syrus.

  67. Nice blog here! Also your site loads up fast! What web host are you using? Can I get your affiliate link to your host? I wish my website loaded up as fast as yours lol

  68. I like this post, enjoyed this one regards for putting up.

  69. I think you have mentioned some very interesting points, thankyou for the post.

  70. Nice blog here! Also your web site loads up fast! What host are you using? Can I get your affiliate link to your host? I wish my web site loaded up as fast as yours lol

  71. I genuinely treasure your work, Great post.

  72. I really thankful to find this site on bing, just what I was looking for : D as well saved to fav.

  73. Great write-up, I am normal visitor of one¦s web site, maintain up the excellent operate, and It’s going to be a regular visitor for a long time.

  74. Hello.This article was really remarkable, particularly since I was browsing for thoughts on this matter last Thursday.

  75. Great wordpress blog here.. It’s hard to find quality writing like yours these days. I really appreciate people like you! take care

  76. Rattling instructive and fantastic body structure of content material, now that’s user friendly (:.

  77. Thanks for sharing excellent informations. Your website is so cool. I am impressed by the details that you have on this website. It reveals how nicely you understand this subject. Bookmarked this website page, will come back for extra articles. You, my pal, ROCK! I found just the information I already searched all over the place and simply could not come across. What a great web-site.

Leave a Reply

Your email address will not be published. Required fields are marked *