A day of reckoning is coming!

Retirees will face a day of reckoning in 2023

The stimulus payments have stopped as inflation remains a persistent burden for all Americans. More concerning however is the impact of the Federal Reserve’s series of rate hikes on consumers who hold a credit card balance. Data collected by CreditCards-com shows the average general-purpose credit card APR is 22.66% and retail credit cards have reached an astounding 26%. Then there’s the average credit card balance carried by older Americans before the Feds rate hikes. Baby boomers carry an average balance of $6,000. The silent generation, those between the ages of 77-94 hold an average of $3,100 in credit card debt. The key words are average balance meaning each of these individuals is seeing higher interest rates which in turn slow down the payment of their principal balance.

The demographics show the older generations are far from debt-free. In fact, adults aged 50-59 hold…

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John A. Smaldone December 12, 2022 at 7:37 am


Good presentation! More seniors are resorting to credit Cards just to keep their Head’s above water and yes, the interest rate is killing them. A senior with equity in their Homes and are faced with the rising cost of inflation, credit Card rates through the Roof and income streams not being able to keep up with it all have a reverse mortgage to be their saving grace!

This is an excellent sales tool for originators to use and advertise. The most important thing to come out of it all is that every senior Homeowner who is saved by a reverse mortgage will have their originator to be grateful to!


Garrett Duffy December 12, 2022 at 4:02 pm

Excellent article Shannon. I am two years into the reverse world and I have learned so much from you. Thank you!

Shannon Hicks December 13, 2022 at 7:09 am

Garrett- thank you kindly. I’m glad to hear you benefit from our broadcasts. Here’s to our mutual journey of learning.

James E. Veale, MBT December 13, 2022 at 8:55 am

One of the most confusing areas in household finances is the concept of cash flow. Even in this industry where we provide what is essentially a cash flow product,, the term loan proceeds is freely interchanged with income as if no one misunderstands what we say. The facts are that our presentations particularly on HECMs confuse those whom we try to convince.

I have heard experienced reverse mortgage originators say things like: “Making minimum payments on your credit cards like you have for the last 10 years reduces your income so that you have less to spend.” If their income is solely coming from SSRBs (Social Security Retirement Benefits) how are credit card payments reducing income??? What they are reducing is spendable cash flow.

Today we find that the 10/2/2017 changes and higher interest rates mean fewer prospects qualify for a HECM. So how can we help these seniors get relief from this monster, called credit cards if they can’t get a HECM? Most such seniors need the services of an attorney who helps seniors who are on a fixed income with credit payment problems. There are both non-profit and for profit law firms that will provide such services either on a low cost or no cost basis to low and fixed income seniors.


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