As many experts would like to get away from the name and idea of a “Reverse Mortgage”, it appears that we are stuck with a name that simply does not adequately describe its value.  The real name for a reverse mortgage is The Home Equity Conversion or H.E.C.M. for short. 

When it comes to using a Reverse for retirement planning, there are several strategies that make this a must in the eyes of financial advisors and their clients.  That’s due to recent reverse mortgage (HECM) program changes over the past few years changing the way reverse mortgages are perceived.

Let’s take a look at only one use for the H.E.C.M. line of credit.   Whatever your retirement nest eff is made of, there is volatility.  The timing of that volatility is one of the biggest risks retirees face when trying to make a retirement portfolio last for an ever lengthening retirement.  Tapping a reverse mortgage HECM line of credit can be an effective way to reduce your sequence of returns risk and avoid selling your investments when they drop in value.  You can set up a HECM line of credit at as early as 62 and the line will be guaranteed and continuously grow regardless of property values.

According to some economic giants, like Jamie Hopkins in Forbes magazine, “The lack of focus on home equity in retirement income planning is nothing short of a complete failure to properly plan and utilize all available retirement assets. This needs to change immediately.”