Financial security is a matter of great concern for elderly, especially in a bad economic environment. As the incomes dry due to physical inability of doing most of the professional work (not true in all cases though), Senior citizens generally worry about what would happen when they could not earn any income. How will their daily and health expenses will be met?
In most cases, elderly do not like to burden their children with their responsibility at this age and in many cases children too do not want to fulfil this responsibility. At this stage there are only a few options left for elderly – one of it is using their home equity to sustain their daily expenses and still live in their own home. Here is an example of how one elderly used reverse mortgage to ensure her financial security in times of crisis.
Elizabeth Gardener (79 yrs) was living in New Hope, Bucks county for the past 26 years. When Elizabeth was 76yrs old, she was working 40 hrs a week at a local art gallery. She barely had money to spend on extras in life because most of income she received every month was enough to pay her bills. She was worried about her life and asked herself what would happen if she could no longer physically continue to work or if she is laid off from her job? She wanted to lead a peaceful life without any worries. She gave a thought of moving to less expensive areas to live but finally gave up the idea.
One day she was talking to her neighbour about her problems and they suggested her to obtain reverse mortgage. So she approached a local bank to apply for reverse mortgage and got it. Now, she doesn’t panic for unexpected expenses that incur every month and stopped figuring out where the money will come from for her basic survival. She can take the car for service without concern for money. Ms. Elizabeth works at a museum in New Hope only for part time.
Key Take Away:
While above is a representative example of how reverse mortgage can help ensuring financial security. The bottom line is if you need to spend your life with a financial security, but don’t possess any savings or investments (excluding investment on house), then reverse mortgage presents an option you can explore. We recommend to study reverse mortgage facts and understand them fully before applying for it.
Source: Homemods, internet research