‘Great’ Financial Planners Must Consider Reverse Mortgage Strategies

A competent financial adviser should be able to assist clients with an array of essential investment services that fit their particular needs. And this includes evaluating the potential use of reverse mortgages to produce retirement income, says one financial planning professional.

People enlist the services of a financial planner to effectively prepare themselves for the future, especially in retirement. Planners, however, have different strategies for helping clients maximize their savings. Depending on their focus, planners could be “short changing” clients if they don’t consider a variety of strategies that could potentially meet their clients’ needs, according to a MarketWatch article written by Kenn Tacchino, professor of taxation and financial planning at Widener University in Chester, Pa., and editor of the Journal of Financial Service Professionals.

“The common perception is that financial planning for retirement is about creating investment strategies and maximizing returns,” writes Tacchino, who is also editor of the Journal of Financial Service Professionals. “To be sure this is a big part of it, but if your planner only focuses on your portfolio they are short changing you regarding a variety of essential services you are likely to need.”

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Calculating how much savings a client needs, assessing the best age to claim Social Security and diagnosing a client’s optimal retirement age are just a few run-of-the-mill services an advisor should be able to provide, according to the article.

Planners should also be able to determine the best strategy for turning retirement assets into retirement income, and this includes evaluating how to use the house as a financial asset.

“For many middle-class Americans, the home represents their single greatest financial asset,” Tacchino writes. “A good planner should be able to decide if a reverse mortgage is a good fit for your situation. A great planner should know about how the standby reverse mortgage strategy can be used to extend the time you will have usable financial assets in retirement or whether a sale-leaseback is a strategy you should consider.”

Read the MarketWatch article.

Written by Jason Oliva