Retirees are living longer and outliving savings is now a major concern. It is widely accepted that withdrawing more than 4% of retirement savings per year drastically increases the chance that it will run out in less than 30 years. But many retirees find that unexpected expenses make it impossible to avoid doing just that.
The conventional wisdom is to view home equity as a “last resort” to be used only if and when savings are exhausted. But research done by Drs. Barry H. Sacks, J.D., Ph.D. and Stephen R. Sacks, Ph.D shows that reversing that passive strategy by setting up a standby reverse mortgage line of credit is a much more effective way to ensure your savings will last your lifetime. The idea is to draw from the line of credit for expenses exceeding 4% of your savings, which preserves capital during the critical early years of retirement. This approach has been demonstrated to be much safer and more effective under a wide range of conditions and may even leave you a higher net worth to pass on to your heirs. The original Wall Street Journal article can be downloaded here:
The conventional wisdom is to view home equity as a “last resort” to be used only if and when savings are exhausted. But research done by Drs. Barry H. Sacks, J.D., Ph.D. and Stephen R. Sacks, Ph.D shows that reversing that passive strategy by setting up a standby reverse mortgage line of credit is a much more effective way to ensure your savings will last your lifetime. The idea is to draw from the line of credit for expenses exceeding 4% of your savings, which preserves capital during the critical early years of retirement. This approach has been demonstrated to be much safer and more effective under a wide range of conditions and may even leave you a higher net worth to pass on to your heirs. The original Wall Street Journal article can be downloaded here:
RSS Feed
