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You have worked most of your life to pay off or pay down your mortgage so that you will not have a mortgage payment when you retire. You have put 20% of your annual income each year towards retirement and have about $400,000 saved for retirement. You purchased your home 20 plus years ago for $100,000 and today the home is worth $500,000. You have worked very hard to build your nest egg and now you turn 65 and say good bye to your employer and enjoy the retired life. A few months pass and you discover that you have a health issue that is going to require you to use a long term care facility and you realize that everything that you have worked so hard for is at great risk.

Today 60% of seniors will use some sort of long term care, at home care and assisted living care during their senior years. An estimated cost of long term care is $90,000 annually and the estimated stay in a nursing home is 2.5 years. This could potentially be a cost of over $200,000. How could you protect yourself?

Today seniors have very few options on how to address long term care issues that they might face. If you have enough money you can pay for the care yourself and have your assets depleted and therefore less will go to the survivors of your estate. You could protect yourself with the use of an irrevocable trust, but you will lose control of your home and the government is continually making changes with the use of trusts to avoid long term care cost. You could spend down to the Medicaid limit and have Medicaid pay for your care. This option leaves nothing for the surviving spouse and you are put in a long term care facility that accepts Medicaid payments and this could mean in a home that you do not want to go to.

Finally seniors could purchase long term care insurance. The insurance will give you control of the type of care you want and can protect your assets. The down side is that long term care insurance is expensive for seniors. The answer to this is to use the equity you have in your home to pay for the long term care insurance premiums. You have worked very hard to pay off the mortgage and you have seen a nice return on the home appreciation. Why risk losing all of this? With a Reverse Mortgage you would be allowed to leverage some of the equity of your home to cover the long term care policy costj and protect your assets. This option will provide you with a piece of mind knowing that your estate is protected, you will not be spending any retirement money and survivors will benefit from your estate.

Reverse Mortgages are an estate planning tool that is designed for home owners that are 62 years or older to leverage the equity in their home for their use to assist with many issues that seniors face today. Reverse mortgages are NON-Recourse loans and you will remain the owner of your home, not the lender.