Working longer, only semi-retiring or delaying social security payments are options for seniors to fund their Golden Years. However, these options come to the detriment of the Baby Boomer generation which is simply unprepared to retire. In a recent survey conducted by Allianz Life Insurance Company of North America, 57 percent of Baby Boomers felt that they are prepared for retirement. The general rule-of-thumb is to maintain 60 to 70 percent of your working income during your post-work life.
Yet some financial analysts suggest seniors need not spoil their retirement by continuing to work into their seventies. Instead, a reverse mortgage has been touted as a way to fund longevity without altering retirement plans.
For seniors 62 or older, a reverse mortgage can leverage the equity in a home to provide additional income while eliminating monthly mortgage payments. Borrowers can receive funds in the form of a lump sum, monthly payout or a line of credit which can continue to grow over time.
Meanwhile, conventional mortgage rates remain near all-time lows. Conforming no-point 30-year fixed rates are averaging 3.375 percent while the 15-year rate is near 2.625 percent.
Do you have a question for Real Estate & Mortgage Analyst Mehran Aram? Submit your queries about a home purchase, refinance, or reverse mortgage via Aramco.Biz, social media (#AramcoReport), or over the phone at (866) 381-8888 and your questions may be featured in an upcoming article.