As divorce becomes more common among older couples, reverse mortgages can be financially useful tools, especially for divorcing women, Forbes reports.
While the overall divorce rate has been declining, it is on the rise among older generations, with “grey divorce” identified as a significant 21st century trend.
For those divorcing at age 62 and older, reverse mortgages can represent a new strategy for making divorce settlements last as long as possible, writes Forbes, as they are becoming “basic financial management tools, rather than just last-resort methods to increase cash flow.”
An example the article suggests is using a reverse mortgage to provide cash funds during retirement could save divorced individuals from having to sell temporarily depressed investments.
Reverse mortgages can also delay drawing from Social Security and help pay off a traditional mortgage or other debts, rather than using taxable withdrawals from a 401(k) or other retirement investments.
Written by Jason Oliva