Baby Boomer Equity Should Be Considered

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Baby Boomer’s Wealth is in Their Home

reverse mortgage newsThe new expanded definition of a fiduciary for financial advisers could expand the required discussion of assets to be considered in a comprehensive retirement strategy. Good news considering the fact that the baby boomer generation is largely unprepared for retirement. In last week’s episode we discussed the recent ruling by the Department of Labor expanding the definition of a fiduciary to include those who give investment advice on more common retirement accounts such as IRAs. Soon red flags could be raised for financial professionals who fail to look at home equity when advising their clients.

A recent article in Investment News by Jamie Hopkins explores the implications of the new fiduciary standard. Hopkins says “an expanded fiduciary standard for financial advisers will put pressure on a variety of areas in the retirement income-planning profession.” The expanded fiduciary standard may seem overreaching to some financial professional trade groups but it could help protect baby boomers from receiving incomplete advise which could cost them dearly financially or in lost opportunities.

Consider the three sources of wealth…

 

Download a transcript of this episode here.

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Using #Hashtags & Trending Stories

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Hashtags can take your social media marketing to new heights

reverse mortgage newsHashtags. They’ve become increasingly popular in social media. Most often we associate hashtags with Twitter but they are now being used across several social media platforms. A hashtag is a word or phrase used to identify a subject preceded by the # (pound) sign…or hash mark. Think of them as a way to make your post search friendly.

Let’s say you are attempting to engage generate interest in the HECM with financial planning professionals. If you are authorized by your lender or broker to use social media you could use the hashtag #money #retirement #reversemortgage for example. Keep in mind that LinkedIn does not currently support hashtags so you should avoid them there. Instead LinkedIn offers up to three keywords on your profile posts. The social media platforms Twitter and Facebook are hashtag friendly and will help increase post engagement.

Should you use hashtags? Consider this. Today…

Download a transcript of this episode here.

Looking for more reverse mortgage news, commentary and technology? Visit ReverseFocus.com today.

Nature Knows Best

What we can learn about aging from trees…


reverse mortgage news“If you’re lonely, sit under a willow tree,” says ethnobotanist and medical biochemist Diana Beresford-Kroeger, who then explains, biochemically, why this will help. Equal parts scientist and mystic, Irish-born Beresford-Kroeger grew up studying the interface between the arts and sciences, forging her unique perspective to illustrate how, beyond bromides, Mother Nature really does hold the answers for health and well being, for people and planet.

In The Sweetness of a Simple Life: Tips for Healthier, Happier and Kinder Living Gleaned from the Wisdom and Science of Nature, she mixes knowledge, wonder, and a heaping dose of common sense to show us how to age well, create a healthy home environment and take care of our planetary body, with humor and down-to-earth information relayed through storytelling and supported with plenty of science. Best of all, her suggestions are easy for seniors, reverse mortgage professionals, or anyone else who yearns to become and remain healthier to implement.

Building Better Brains

Dementia is on the decline, reports Laura Koniver, MD, and fish oil is one of the best ways to protect against it. Beresford-Kroeger agrees, and provides some backstory: “Omega-3 wires the body, connecting the brain to itself and to the rest of the body in the neural pathways, insulated by a myelin sheath, which surrounds the nerve fibers. Omega-3 also wallpapers the membranes of the retina to form the visual images translated and transported by the optic nerve into the brain.

“Life with very little Omega-3 changes the chemistry of the brain itself, resulting in attention deficit disorder, depression, bipolar disorder, memory loss, schizophrenia, even suicide…” Eating a diet rich in Omega-3s (e.g., lamb, saltwater fish such as salmon and sardines, walnuts, and olive oil) is a dietary solution more effective and palatable than pharmaceuticals.

No Bones About It

Then there are the aches and pains that accompany aging. Just a fact of life as our bones become brittle? Not at all, says Beresford-Kroeger. She explains how the “biological rubber” (chondroitin sulphate) that keeps our skeleton functioning can be replaced, with “a good bowl of hot homemade soup made from beef broth. It has all the ingredients to stop the aches and pains in your knees, fingers, feet, hips, neck and back.” She details what to buy and how to prepare the soup, to restore the healthy bounce elders recall from their younger years. [Note: In many communities, it’s now possible to purchase ready-made bone broth from farmers’ markets and organic butchers. Seniors should be sure to ask whether the animals were raised without hormones, on pesticide-free pastures.]

Beresford-Kroeger also describes simple steps to treat addictions (which she used successfully to cure her husband’s three-pack-a-day cigarette habit), what to eat to prevent cancer, and how to create and maintain a healthy weight. It’s the kind of kitchen wisdom our ancestors lived by, often lost today to the lure of technology and accelerated lifestyles.

The Original Social Network

Rediscovering a reverence for Nature’s vast wisdom, we’re invited to join the primal social network: trees, says German forest ranger Peter Wohlleben. “Trees in the forest are social beings. They can count, learn and remember; nurse sick neighbors, and warn each other of danger by sending electrical signals across a fungal network known as the ‘Wood Wide Web’.”

The more time we spend in front of computers and other devices, the more we need to spend time in a forest, says Beresford-Kroeger. “Walk into a pine forest; you’ll come out smarter.” She explains how the biochemical aerosols that pine trees release on warm days penetrate the human central nervous system, making us calmer, better able to focus and learn. Between pine trees, Omega-3s, bone broth, plus the plethora of additional wisdom Beresford-Kroeger shares, seniors (or anyone, of any age) can begin today to boost brainpower and overall health.

Perhaps your next reverse mortgage meeting ought to take place at the edge of a forest. At least consider keeping a jar of organic walnuts on your desk.

 

New Fiduciary Rule Could Open Doors

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New Definition of Fiduciary Could Require Discussion of Home Equity

reverse mortgage newsIt is a game-changer for financial professionals and possibly for reverse mortgage professionals alike. An expected change of the fiduciary rule by the Department of Labor will place many previously exempt financial professionals under the obligation to act in the best interest of their clients, presenting all possible and prudent options.

Last June’s episode “Still Ignoring the Largest Asset” lamented the fact that many financial professionals often ignore the potential use of home equity in retirement planning despite the potential consequences. That could be changing quickly thanks to a new definition of a fiduciary under the Employee Retirment Income Security or ERISA Act. The rule would include those who work with their client’s Individual Retirement Accounts or IRA’s. Under ERISA’s rules a fiduciary extends beyond a person managing assets but also to those giving investment advise for a fee or through other compensation. Advisors looking at the sustainable withdrawals from an IRA could be obligated to bring home equity or a reverse mortgage into the conversation.

“The future is not going to look like today. The fiduciary rule is happening and it’s going to require conversations…”

 

Download a transcript of this episode here.

Looking for more reverse mortgage news, commentary and technology? Visit ReverseFocus.com today.

What Problems Reveal About Ourselves

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How we deal with problems reveals much

reverse mortgage newsWhether it is in the course of originating reverse mortgages or personally we all encounter problems. I’ll be honest, I’m not a big fan of problems but they seem to still like me. Problems are instructive. How we deal with problems reflects on who we are.

Problems come in all shapes and sizes: problem conditions with a loan, a borrower angry with their appraised value, unmet expectations or an argument with our spouse. How we deal with our problems not only reveals our character strengths and weaknesses but also determines our level of success.

Here are some common ways we can deal with problems that are revealing.

Blame

To blame is to shift responsibility to another. Finger pointing may be cathartic but never produces positive results. At its core blame is manipulation, not a trait anyone wants to have attributed to them. How often can we say ‘my bad’ or ‘I am sorry’?

Acceptance

Leaders don’t just work, good leaders do the hard thing. Accepting responsibility for a problem shows leadership, confidence and honesty. Mature leaders..

Download a transcript of this episode here.

Looking for more reverse mortgage news, commentary and technology? Visit ReverseFocus.com today.

Korea’s Reverse Mortgage Program Raises Questions

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South Korea Now Actively Promoting Reverse Mortgages

reverse mortgageThe Korean Financial Services Commission announced last month that they will introduce a new set of policies in the effort to spur reverse mortgage adoption to help the elderly prepare for retirement.  Facing a rapidly expanding aging population and fewer prepared retirees the South Korean government has taken proactive steps to promote reverse mortgages while seeking to change the perception that the home is an asset to be passed on versus a pension product. The question is why doesn’t the U.S. government do the same?

Eighty-one percent of assets held by those 60 and older are held in homes or residential real estate. Sound familiar? It should. South Korean’s face similar challenges found in the United States with more pre-retirees unprepared or underprepared to fund their non-working years. Here’s just one example.

Download a transcript of this episode here.

Looking for more reverse mortgage news, commentary and technology? Visit ReverseFocus.com today.

Allergic Reactions

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Challenging Denial? Proceed with Caution

reverse mortgage newsIt’s springtime here in the western U.S. where the sun shines, flowers and trees bloom and allergy season begins. In fact as I speak my car is covered with the yellow telltale powder of tree pollen. While physical allergies are easy to identify and treat, what about allergic reactions to truth?

Physical allergies are triggered when a person comes in contact with a substance that triggers a a reactions, most commonly a release of histamines that seek to protect your immune system. The problem for those who have allergies their bodies have confused harmless substances as potential threats creating a defensive response. Psychological allergies are quite another matter. Each of us have our hard-wired responses to perceived threats, unsettling information or personal conflict. Some our own responses  could be likened to an allergic reaction.

The same can be said with the prospective borrowers we meet. If we do not tread carefully when exposing the truth that more funds are needed to fund their retirement the feedback can be less than pleasant…

Download a transcript of this episode here.

Looking for more reverse mortgage news, commentary and technology? Visit ReverseFocus.com today.

5 Ways HECMs Ease Retirement

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5 Straightforward Ways a HECM Can Ease Retirement Risk

Jack Guttentag, better known as ‘The Mortgage Professor’ explores several ways that a Home Equity Conversion Mortgage can help ease retirement for today’s older homeowners. Guttentag’s article balances consumer education with the possible strategic uses of a reverse mortgage with five possible applications. reverse mortgage news

While numerous national publications have espoused the strategic use of a HECM line of credit to prolong investor’s portfolios the classic uses of a reverse mortgage also hold promise for older homeowners.

1. Conversion. It’s no secret. Far too many older homeowners carry a mortgage into their retirement years, often beyond their life expectancies. The burden of monthly mortgage payments is especially problematic for retirees on a fixed income wrestling with increasing living and healthcare expenses. Paying off one’s existing mortgage and refinancing into a reverse mortgage provides increased monthly cashflow and peace of mind for many. In his example the Mortgage Professor shows the typical mortgage balances that can be paid off by age and home value. Keep in mind these numbers are based on today’s low interest rates.

2. Postponement. Too often many seniors take Social Security as soon as they are eligible for payment. Guttentag writes “For most seniors, waiting until age 70 before collecting social security, as opposed to taking a smaller amount earlier is an…

 

Download a transcript of this episode here.

Looking for more reverse mortgage news, commentary and technology? Visit ReverseFocus.com today.

Jump Start Your Day

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7am-alarm-clock5 Steps for A Great Day…

Getting your day started can feel like pushing a truck uphill. Most of what we call a ‘good day’ is often judged by how we feel the day began and ended.

Here are 5 practical ways you can jump start your day for greater productivity and happiness.

1. Fuel up. Too often we skip breakfast thinking that we can run on pure determination or caffeine alone. Just as we would never leave the house in our car with an near empty gas tank we should fuel up our tank with a balanced meal high in protein balanced with complex carbs and healthy fats. Many busy professionals I know will make a balanced breakfast shake if cooking is impractical.

2. Eat the frog. Speaking of meals how about frogs? Not literally of course. Eating the frog is a phrase often used by…

Download a transcript of this episode here.

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Tax Deductions & Reverse Mortgages



HECM Mortgage Interest Deductions Complexities

It’s a discussion you rarely overhear among reverse mortgage professionals, the tax deduction of interest charged in a home equity conversion mortgage. Perhaps it’s because such scenarios are not typical or it is the inherit complexities of tax law with a unique mortgage instrument.

tax-deduct-calcWell known industry pundit and financial professional Wade Pfau addressed the tax complexities of reverse mortgages in his March 10th column in Forbe’s Retirement. First proceeds from a reverse mortgage are typically not counted as taxable income. A notable advantage for those seeking other sources of cash flow without incurring the typical tax burdens associated with withdrawals from retirement savings and investment accounts such as 401(k)s, IRAs and event annuities. Higher net worth individuals may employ such a strategy to avoid slipping into a higher tax bracket.

While more affluent individuals may find advantages in this strategy lower income individuals…

Download a transcript of this episode here.

Looking for more reverse mortgage news, commentary and technology? Visit ReverseFocus.com today.