HECM Archives - Jerry Golden on Retirement

Is Your Retirement Solution Hiding in Plain Sight?

June 9, 2024 By Jerry Golden in Annuity Tags: Annuities, HECM, HomeEquity2Income, QLAC

Here’s how to use your home equity in combination with an annuity contract to produce late-in-life income.

Editor’s note: The earlier article How Your Home Can Fill Gaps in Your Retirement Plan discussed the “why” of incorporating the equity in your home in your plan for retirement income. This article discusses the “how.”

In retirement, your home means something more than it did while you were raising kids, getting promotions at work, and dreaming about how the future might unfold.Now, it can provide the opportunity that helps you realize your future in retirement — financially at least.

For most of us, our house carries much more equity than it did when we were just starting out. Home prices have more than doubled in the past 20 years. How to use that equity to benefit you and your family is a key retirement question that your home can answer. But as you will see, it may work better when combined with an annuity contract that produces late-in-life income.

How Your Home Can Fill Gaps in Your Retirement Plan

June 9, 2024 By Jerry Golden in Annuity Tags: HECM, HomeEquity2Income, Income annuity, QLAC, Retirement gaps

If you have gaps in your plan for retirement income, you might consider adding the value of your home to your planning.

Most retirement planning methods have ignored what for some retirees is their largest single asset — their home. That means the plan may fail to deliver on one or more of the five things retirees want:

Don’t run out of money
Grow income each year
Leave a meaningful legacy for kids and grandkids
Increase spendable income by reducing taxes
Build up a source of liquidity for unplanned or unfunded expenses

With the addition of the new HomeEquity2Income (H2I) program described in this article, Go2Income now covers over 90% of all retiree asset classes. H2I uses the equity in your primary residence to fill in the gaps in your plan that otherwise might require insurance that you don’t qualify for, higher-risk investments, or more aggressive assumptions as to yields and returns in your plan.Starting with this article and continuing over the next month or so, we’ll cover the why, what, and how of the HomeEquity2Income program.

First, the “why” of H2I.

The (R)evolution of Retirement Income Planning

May 2, 2024 By Jerry Golden in Annuity Tags: HECM, Home Equity Conversion Mortgage, Income annuities, retirement income

With AI on the horizon to enable the optimization of retirement income plan choices, the retirement fortunes of retirees are about to improve.

Once, there were only your stock and bond portfolios, mutual funds or ETFs as options for your retirement savings. You and your adviser managed retirement risk through asset allocation and pretty much ignored which accounts you were invested in and how much in taxes you paid.

The (R)evolution of Retirement Income Planning

When it came to post-retirement, your adviser used “de-accumulation” software that did Monte Carlo simulations of market performance, as I described in my article Don’t Bet Your Retirement on Monte Carlo Models. The model gave you a probability that your retirement savings would last to a specific age. If you wanted to reduce the risk of running out of money during retirement, you were told to set a lower income goal and accept a reduced lifestyle. Experts find fault with this “gambling” with your future, along with other issues in current planning practices and assumptions I have addressed in previous articles, such as: