GPS systems, planes and military equipment track the magnetic field and rely on accurate models of magnetic north to function properly. When the magnetic field shifts, the models must be updated to reflect the changes. “The current behavior of magnetic north is something that we have never observed before,” William Brown, a global geomagnetic field modeler at the British Geological Survey, says….

As a financial advisor, you can’t help thinking, these have been “interesting times”. As the principal source of counsel for many of your clients, the one person with the most detailed understanding of their past and current financial situations, you’re dedicated to prioritizing their best interests. Back when you were beginning your own financial planning career, as your clients approached retirement, they looked forward to monthly pension checks along with social security benefits.

Today, for those clients now in their sixties and nearing retirement, there are no pension checks in the offing. Despite the wonderful growth in their stock funds over the past couple of years, you’re finding they have a lot of concern about starting regular monthly or quarterly withdrawals of funds from their own accounts. Combined with the need to make decisions about the timing of their social security benefits, they confess with being “overwhelmed”.  

For the majority of these clients, their one reassuring “stability” factor is their intention is to continue to occupy their homes; most have retired their mortgages years ago or are close to doing so. Generally speaking, they’ve updated their estate planning documents (for many, you’ve been part of these discussions); with your encouragement, most have made provisions for future healthcare needs.

Meanwhile, though, many articles these clients have been reading (and on which they’re asking you to comment) describe the markets as being “at an all-time high”. They are already dealing with the rising costs of food and fuel, and, mostly confused by all the political changes that seem to be happening just as they draw near to this embarking on the next phase of their lives, they are turning to you for reassurance.

As a financial professional, you’re in a position to effect a “polar shift” of your own –  offering advice about a retirement planning strategy representing a “product” not offered by your broker-dealer or parent company. Even as your own reading and study are describing the use of housing wealth as a “critical tool for retirees looking to protect their lifestyle and legacy,” you have been fearful of discussing reverse mortgages with your clients.  

Fact is, far from a measure “of last resort”, reverse mortgage planning belongs at the “front” of the retirement preparation process, beginning at age 62. Clients who apply now for a reverse mortgage on their home are putting into place an alternative source of monthly or quarterly income, allowing their retirement accounts and investment portfolios to fluctuate with the times, and mitigating the sequence of return risk that is their primary retirement concern.   

With a reverse mortgage loan set up as an equity line of credit, your clients will have  stop-and-start flexibility in terms of withdrawals of cash, with the un-borrowed portion of their Home Equity Conversion Mortgage line of credit growing at the same rate as the interest being charged on the loan itself. Without pressure to liquidate assets from either their qualified or personal investment accounts, the primary danger of sequence risk is removed from their “worry list.” Far from being a ‘last resort”, housing wealth can offer increased flexibility in the face of  market swings and the timing of social security benefits. 

It’s a polar shift, to be sure, for you as a financial advisor to introduce concepts outside the purview of a broker-dealer “product” list. Still, careful to explain that reverse mortgage financing is outside your own area of expertise, suggest to clients over 62 that they check with a reverse mortgage specialist.

As you see magnetic field shifting, update your retirement planning “model” to reflect the change.

https://mutualreverse.com/david-garrison

David Garrison, NMLS ID 1595194. Mutual of Omaha Mortgage, Inc. dba Mutual of Omaha Reverse Mortgage, NMLS ID 1025894. 3131 Camino Del Rio N 1100, San Diego, CA 92108. Indiana-DFI Mortgage Lending License 43321. Michigan 1st Mortgage Broker/Lender/Servicer Registrant FR0022702. These materials are not from HUD or FHA and the document was not approved by HUD, FHA or any Government Agency. Subject to credit approval. For licensing information, go to: www.nmlsconsumeraccess.org

Equal Housing Lender

A sibling’s recent health scare played a large part in your decision to retire from full time work at the end of first quarter 2026, you admit. You will be taking early retirement from a executive-level corporate position; your wife will be leaving her position as a school administrator. While the final decision to retire was recent, for years, now, you’ve been putting the pieces in place to embark on the next phase of your lives. 

Handy with tools, you’ve kept your home, a ranch house in a comfortable, very friendly neighborhood, in top notch condition, and hope to spend the rest of your lives there. Your mortgage was retired a decade ago, at which point you began diverting all extra dollars to maximizing contributions to both retirement plans and to building up your jointly held investment account. You have updated your estate planning documents and continued funding a “hybrid” life insurance policy that can be tapped for long term care needs. 

Despite all these very reassuring preparations – and, both despite and because of – the wonderful growth in your stock funds in the past couple years, you’re concerned about beginning to withdraw funds on a monthly or quarterly basis. Many articles you’ve read talk about the “sequence of returns”, and, with the markets “at an all-time high”, the rising costs of food, and all the political changes happening just as you’re about to retire, you feel there is real cause for concern. One pending choice is whether one of you or both should take early Social Security benefits beginning next year.

One important retirement planning resource you haven’t mentioned is your housing wealth. Applying now for a reverse mortgage on your home will create an alternative source of monthly or quarterly income, allowing your retirement accounts to “weather” any market turbulence. Because withdrawals from your equity would be tax free,* fewer dollar might be needed. By setting up the reverse mortgage loan as an equity line of credit, you’ll have stop-and-start flexibility in terms of withdrawals. In fact, your ability to draw money from your home equity will allow you to benefit from market dips by adding to your investment portfolio. Meanwhile, the un-borrowed portion of your Home Equity Conversion Mortgage line of credit would grow at the same rate as that being charged on the loan itself.  

Far from being a ‘last resort”, your housing wealth can offer you increased flexibility in the face of market swings and the timing of social security benefits, with reverse mortgage funding moved to the “front of your retirement resource “line”

https://mutualreverse.com/david-garrison

*Please consult a tax advisor. David Garrison, NMLS ID 1595194. Mutual of Omaha Mortgage, Inc. dba Mutual of Omaha Reverse Mortgage, NMLS ID 1025894. 3131 Camino Del Rio N 1100, San Diego, CA 92108. Indiana-DFI Mortgage Lending License 43321. Michigan 1st Mortgage Broker/Lender/Servicer Registrant FR0022702. These materials are not from HUD or FHA and the document was not approved by HUD, FHA or any Government Agency. Subject to credit approval. For licensing information, go to: www.nmlsconsumeraccess.orgEqual

Housing Lender

STEPPING UP TO PARENT THE SECOND TIME AROUND 

It’s supposed to work the other way around, but your reality is that, in your early 70s, you have become “substitute parents” for your two granddaughters, one now 8, the other 13. While your ex-daughter-in-law, a traveling nurse, has always needed to work out of town a good portion of the time, your son had regular hours and had been able, even after the divorce, to manage with the help of a neighbor. Circumstances have changed in two terrible ways: Your daughter-in-law is on disability leave; your son was downsized and had been supporting himself with temporary job assignments, many of which require him to drive long distances.

In order to help supervise the two girls and keep their routines as stable as possible, you’ve offered to have them and their father move into your home. With your husband a retired educator, he is in a position to help supervise the girl’s studies; you can help drive them to their various activities, as well as to visits with their mother, allowing your son to focus on finding new, permanent employment. From a financial standpoint, your plan is to charge no “rent” until your son’s home is sold, and, in fact to help finance clothing, fees, etc. for the granddaughters until the situation “settles itself out”. Contributions to the college fund that your son and daughter-in law had created for the girls will simply need to be put on hold for the time being.

Amidst all the sorrow about your daughter-in-law’s condition and your worry about your son’s livelihood, you are trying to be realistic about your own financial situation. You had used a home equity line of credit to fund the big retirement remodel; you now have that loan about three quarters repaid. Your regular system of taking money out of both your retirement accounts as well as from your jointly owned investment account, along with your social security benefits, should, at least in the near term, suffice to cover the increased food and other household costs. 

As an alternate approach to this challenging family situation, consider using your housing wealth in the form of a reverse mortgage line of credit. You would continue, of course, to take care of home maintenance costs, taxes, and insurance. Once your reverse mortgage has paid off your existing HELOC loan, (and the required monthly mortgage payments* have been eliminated) future withdrawals from the remaining equity would be nontaxable.** Any unused portion of your housing wealth would grow at the same rate of as that being charged on the borrowed funds.

With the family situation so subject to change (given your ex-daughter-in-law’s health issue and your son’s employment uncertainties), a reverse mortgage line of credit can help you help them, but only for as long as – and to the extent needed.  

Your housing wealth can help you help your child- the second time around!

*Borrower must occupy home as primary residence and remain current on property taxes, homeowner’s insurance, the costs of home maintenance, and any HOA fees. **Please consult a tax advisor. David Garrison, NMLS ID 1595194. Mutual of Omaha Mortgage, Inc. dba Mutual of Omaha Reverse Mortgage, NMLS ID 1025894. 3131 Camino Del Rio N 1100, San Diego, CA 92108. Indiana-DFI Mortgage Lending License 43321. Michigan 1st Mortgage Broker/Lender/Servicer Registrant FR0022702. These materials are not from HUD or FHA and the document was not approved by HUD, FHA or any Government Agency. Subject to credit approval. For licensing information, go to: www.nmlsconsumeraccess.orgEqual Housing Lender

BUILDING A PATH TOWARDS AGING IN PLACE 

While you and your husband have not changed your minds about spending the rest of your lives at home (as opposed to moving into a retirement facility apartment), following a series of lengthy meetings with contractors of various types, you may have changed your thinking about where this “aging in place” will in fact take place. With your three children and their offspring are spread out in different states (you travel to visit them, rather than them visiting you). Your three-story house is not only far larger than you need, but the property has far too much acreage. Even with a “facelift”, you’ve come to realize, this home is not really going to be suitable for your future lifestyle needs. 

As a next step, the two of you began looking at homes for sale, both in your present neighborhood and in the newer suburbs northward. Knowing that some friends had worked with building contractors to design a home tailored to their tastes, you’ve even considered going that route. You know your present home has appreciated considerably in value. From a financial viewpoint, in addition to your respective retirement plans (yours 403b, his 401k), you have a jointly owned portfolio and cash account. Still, you are concerned about managing all the financial aspects – not to mention the logistics of selling one home, building another, and moving.  

In your quest to age in a home of your own, but in one more suitable for a senior lifestyle than your present pace, building, as opposed to purchasing, can “buy” you the time prepare your present home for sale. A HECM for Purchase is a financing option that allows you to use a reverse mortgage to pay for up to half the total sale price of a new home.  In a single transaction and one (not two) set of closing costs, you complete your new home purchase and your mortgage. So long as you continue to live in that new home, taking care of property taxes, homeowners’ insurance, and maintenance costs, and any HOA fees, you will not be required to make monthly mortgage payments* on your reverse mortgage.

You might consider moving forward by taking two steps:

Contract with a builder and make the down payment. (Typically, you will not need to come up with the rest of the purchase price until the home is finished.) 

Get prequalified for a special type of reverse mortgage – a Home Equity Conversion Mortgage for Purchase (which you will not use until a Certificate of Occupancy is issued and it’s time to take possession of your new home).

You will be avoiding participating in the “bidding wars” that often accompany the quest to purchase an existing home, all while “locking in” the purchase price of your future home, all with an eye towards building a path towards aging in place.

https://mutualreverse.com/david-garrison

*Borrower must occupy home as primary residence and remain current on property taxes, homeowner’s insurance, the costs of home maintenance, and any HOA fees. David Garrison, NMLS ID 1595194. Mutual of Omaha Mortgage, Inc. dba Mutual of Omaha Reverse Mortgage, NMLS ID 1025894. 3131 Camino Del Rio N 1100, San Diego, CA 92108. Indiana-DFI Mortgage Lending License 43321. Michigan 1st Mortgage Broker/Lender/Servicer Registrant FR0022702. These materials are not from

While stock market growth has worked in your favor these past two years since you retired, you are feeling far less secure going forward. You’ve been exploring possibilities for refinancing your home as a way to feel more secure about your own financial future.Widowed more than a decade ago, you are not planning to remarry, but you are very actively involved in cultural activities with friends, intending to make every effort to remain in your neighborhood. You’ve kept the house maintained and both indoor and outdoor décor updated, and hope to be able to live at home for decades to come.

A recent seminar you attended with a female friend dealt with ways to “utilize housing wealth” in retirement. Your friend liked the idea of having an equity line of credit, and, frankly having a source of extra cash sounds appealing for you as well, given the chance that the market value of your investments (as some pundits would have it) might take a “hit” in the not-so-distant future. At the same time, you understand that the equity in your home is a finite resource, and when you reach the limit of that equity line of credit, the money flow could come to an abrupt end.

Some clarification might be needed here. True, if you were to take a reverse mortgage structured as a line of credit, once the entire benefit is used up, no further draws will be permitted. At that point, you would have the choice of refinancing to take advantage of any appreciation in value that has taken place. The other important advantage is that, whatever portion of your credit line is not used will keep growing, increasing at the same rate as the interest being charged on the borrowed portion of the line.

A second approach is to take the reverse mortgage benefit in the form of a lifetime tenure payment, which continues for as long as you reside in your home, regardless of how long that is. Just as, in academic institutions, permanent employment status is granted to individuals after a probationary period, a tenure reverse mortgage payout is :”permanent” for as long as you occupy the home.

https://mutualreverse.com/david-garrison

David Garrison, NMLS ID 1595194. Mutual of Omaha Mortgage, Inc. dba Mutual of Omaha Reverse Mortgage, NMLS ID 1025894. 3131 Camino Del Rio N 1100, San Diego, CA 92108. Indiana-DFI Mortgage Lending License 43321. Michigan 1st Mortgage Broker/Lender/Servicer Registrant FR0022702. These materials are not from HUD or FHA and the document was not approved by HUD, FHA or any Government Agency. Subject to credit approval. For licensing information, go to: www.nmlsconsumeraccess.orgEqual Housing Lender

When Sinatra crooned “Love is lovelier the second time around”, you’re pretty sure he wasn’t referring to a home mortgage refinance. In fact, in the years leading up to your retirement from full-time employment (six years ago now, with your wife having retired a year prior to that), year earlier), your focus had been on “retiring” your home mortgage. 

Post-retirement, having decided against following some friends into retirement community living and in favor of “aging in place”, you took out a reverse mortgage, using a portion of the equity line to restructure the home’s interior to improve navigability and safety. Other than those expenditures, you’ve not found the need to make withdrawals from your Line of Credit since then. Meanwhile, not only have you enjoyed “staying home”, you’ve noticed that real estate values in your neighborhood have continued to escalate. Although your own decision to stay put has not changed, you would like to find a way to take advantage of the increase in value of your home and are wondering whether refinancing the reverse mortgage loan is a viable move. 

An appreciation in home values in your area is certainly reason enough to at least consider a HECM-to-HECM refinance. A new appraisal (sometimes the lender might require using the lower of two appraisals) would be needed, with the possible result being a significant increase in the Line of Credit available for your use (tax-free*) for years to come. 

As you know, all reverse mortgages are non-recourse loans, meaning that, so long as you continue to occupy the home and keep up with the maintenance and insurance costs, no monthly mortgage payments** will ever be required. With no monthly mortgage payments** due, you will never be “upside down”; neither you nor your heirs will ever owe an amount greater than the value of the home itself. 

 It will be reassuring to have a larger line of credit as, on the one hand, a “buffer” against future inflated medical and daily living costs, and, on the other hand, a source to tap for travel and other luxuries.

Just as Sinatra used to croon, referring to love, you may well find that a reverse mortgage is lovelier the second time around!

https://mutualreverse.com/david-garrison

*Please consult a tax advisor. **Borrower must occupy home as primary residence and remain current on property taxes, homeowner’s insurance, the costs of home maintenance, and any HOA fees. David Garrison, NMLS ID 1595194. Mutual of Omaha Mortgage, Inc. dba Mutual of Omaha Reverse Mortgage, NMLS ID 1025894. 3131 Camino Del Rio N 1100, San Diego, CA 92108. Indiana-DFI Mortgage Lending License 43321. Michigan 1st Mortgage Broker/Lender/Servicer Registrant FR0022702. These materials are not from HUD or FHA and the document was not approved by HUD, FHA or any Government Agency. Subject to credit approval. For licensing information, go to: www.nmlsconsumeraccess.orgEqual Housing Lender