People Are Living the Numbers

by Jesse Q. Allen of One Trust Home Loans

Upon returning to the reverse mortgage industry in 2016, the most common question posed was about the largest change I had observed since my time running Bank of America’s reverse platform six years earlier. Initially, my response focused on the significant regulatory changes and consumer safeguards introduced after the 2008 financial crisis. I also highlighted the wealth of academic and policy research demonstrating the benefits of incorporating home equity into retirement income strategies and the emergence of various senior services businesses.

While these developments are crucial and have enhanced the program’s safety, soundness, and awareness, I have come to realize that the most meaningful change is that the math of the “retirement crisis” is no longer theoretical. Individuals and families are living these realities daily.

As Sandra Block recently cited in Kiplinger, “More than half of 65-year-old Americans will need long-term care services of some kind…” [1]This statistic resonates profoundly when you find yourself on a plane seated next to an adult child who is one of the “40 million family caregivers, providing unpaid care, which AARP recently valued at an estimated $600 billion.”[2] For these caregivers, the statistics are personal, accompanied by emotional and financial stresses that are all too real.

Retirement readiness is no longer an abstract concern. Important questions abound:

• How do I best provide inheritance while alive?
• How can I enhance my private pay options for in-home care and ease the burden on my family?
• How can I modify my home for better accessibility and safer aging in place?
• How can I buy my dream retirement home without a hefty mortgage payment?
• How can I avoid outliving my savings?
• How can I pay off my current mortgage or high-interest credit cards to improve cash flow?
• How can I access my home equity if I am on a fixed income and have been declined for a traditional mortgage cash-out refinance or home equity line of credit (HELOC) due to Debt-to-Income issues?
• What are the most tax-efficient withdrawal strategies during retirement?

These are critical, life-changing questions that thousands—if not millions—are grappling with as you read this article. The work we do in the reverse mortgage space is vital in helping homeowners responsibly tap into home equity, allowing them to enjoy their retirement years with greater financial freedom and peace of mind.

Of all the challenging and fun work I have had the privilege of doing over my thirty-five years in financial services, helping homeowners leverage their accumulated housing wealth to increase choice and drive improved outcomes is deeply rewarding. Witnessing the growth of businesses that deliver emotional and financial value through specialized expertise—from in-home care to veterans’ benefits and social security counselors—is equally exciting.

”I have come to realize that the most meaningful change is that the math of the “retirement crisis” is no longer theoretical.”

The significance of this collective work cannot be overstated, but the complexity can be daunting, which often contributes to underutilization. For instance [READ MORE]