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What are the qualifications?

The youngest borrower on title must be 62 years of age or
older. A non-borrowing spouse may be under 62.

The home must be the borrower’s primary residence.

The home equity must exceed 40% in most cases, How can it be
depending upon the borrower’s age. used for retirement
The borrowers will undergo a financial review to ensure security?
they are able to comply with the loan terms.

3 Replace cash reserves

The Big Picture 3 Eliminate monthly mortgage
payments** for borrowers and
help to increase cash flow

Home equity is a dynamic financial tool that should 3 Delay drawing Social Security
payments and pension
be discussed with clients to help them reach their payouts
retirement goals.
3 Loan Proceeds are not
PORTFOLIO SURVIVAL RISKS: DEMOGRAPHIC STATISTICS: considered income and can
1. LESS STRUCTURED ASSISTANCE AMERIPRISE SURVEY 9 be used as a tax-free income
The shift from defined benefit 47% of respondents plan to use supplement*
plans to defined contribution plans home equity to help fund their
might affect the distribution of retirement. 3 Buffer spending of
retirement income among baby investments in a down market
boomers.
-Social Security Administration 5 3 Cover unexpected gaps in
47%
2. MARKET VOLATILITY AND medical coverage, including
SHORT-TERM THINKING long-term or nursing care
Overreacting to short-term market
volatility can endanger long-term 3 Provide a new way to diversify
results. wealth
BOSTON COLLEGE CENTER FOR
3. LONGEVITY About one out of RETIREMENT RESEARCH 10 3 Use a HECM for purchase to
every four 65-year-olds today will 74% of retirees will fall short of allow a client to purchase
live past age 90, and one out of 10 their income needs at 62 years old. a new home and save the
will live past age 95. residual cash for other
-Social Security Administration 6 investments

4. TAXES The top marginal tax 3 Enhance financial security
bracket for many retirees in 2016 74%
was 39.6%. Minimizing this tax without affecting some
burden can help stretch savings. benefits such as Social
-TaxFoundation.org 7 Security or Medicare

5. HEALTHCARE Approximately
70% of Americans age 65 or older
will need some type of long-term HECM loans are a
care.
-Administration on Aging8 powerful financial planning tool that
can turn home equity into retirement security.