Page 9 - Your Guide to Retirement Booklet

Five Strategic Ways to Use a

Reverse Mortgage Loan

1. HECM Growing Line of Credit 2. Protection from Investment Downturns

Only available to homeowners 62 and over, a HECM You can set up a reverse mortgage loan at the
growing line of credit is similar to a home equity line beginning of your retirement to help minimize risk to
of credit (HELOC), only much better. With it, you can your investment portfolio. This allows you to withdraw
establish a line of credit using a reverse mortgage loan, from your investments during years of normal returns,
and you can let that line of credit grow at an interest and in a down market, withdraw from your HECM line
rate that is equal to current loan rates. And unlike of credit. This strategy allows your investments time
a traditional HELOC, this loan does not have a pre- to recover from bear markets. Withdrawing from your
determined repayment period—it can be available for a investments during down markets may also increase the
duration determined by you. A HECM line of credit also likelihood that you will deplete your investment assets
includes a compounding feature, which means your sooner than planned. By utilizing your home equity
available credit increases each period on the prior with a reverse mortgage, you have a greater chance of
period’s available credit balance. At any time, the line preserving your investment portfolio longer throughout
of credit can be accessed for incidental cash or even your retirement.
converted to monthly term or tenure payments.

HECM Reverse Mortgage
Growing Line of Credit Investment Portfolio Volatility 1

PORTFOLIO PERFORMANCE Market Volatility Cycles
*Supplement your monthly
income with a reverse mortgage
loan during portfolio downturns.
LINE OF CREDIT AMOUNT

1 2 3 4 5 6 7 8 9 10
YEARS
YEARS 1 For illustration purposes only. Actual portfolio performance may vary.

Reverse Mortgage Retirement Planner 5