As clients retire, and hence end the receipt of regular income from employment or professional activity, cash flow considerations become paramount.  

Indeed, studies have shown that for most retirees, the concern about “running out of money” later in life outweighs any other concern. Also, studies show that more than half of all retirees are homeowners.

This webinar examines four situations in which home equity can be used to diminish retirees’ risk of cash flow exhaustion while maintaining an acceptable level of living expenses. Quantitative examples will be given to illustrate each of the four situations. 

In "Advanced Strategies for Using Housing Wealth to Improve Financial Outcomes in Retirement" by Barry Sacks, you will learn:

1. The effect of skipping a few distributions from a securities portfolio, replacing the income with draws on a buffer asset such as home equity, and how the result is greater cash flow sustainability and a greater legacy;
2. Using a reverse mortgage to replace a conventional mortgage, and thereby reducing cash needs during retirement. (This is important for the many retirees who want to “age in place.”);
3. How to use a “reverse mortgage for purchase” to downsize or to change location, and to provide additional funds to invest for additional cash flow in retirement;
4. Using a reverse mortgage to provide liquidity for the division of assets in “silver divorce.”

Your presenter is Barry Sacks, PhD., JD, Reverse Mortgage and Retirement Portfolio Longevity Expert .

Barry Sacks, Ph.D. earned his Ph.D. in semi-conductor physics from M.I.T., and then taught at U.C. Berkeley. He earned a J.D. Harvard Law School, and is a Certified Specialist, Taxation Law, from the California Board of Legal Specialization.  Barry spent 35 years as an ERISA attorney, specializing in qualified retirement plans. He then used his breadth of skills to discover a role for a reverse mortgage to help make a retirement portfolio last longer. Barry now has a law practice providing special services to tax professionals in the area of “Offers in Compromise” for retirees living on 401(k) accounts or other securities portfolios.

Barry and his brother, Stephen Sacks, Ph.D. shared their analysis of the reverse mortgage credit line in the February, 2012 Journal of Financial Planning. They revealed that if a reverse mortgage credit line was drawn on before drawing on investments when values had declined, a retiree’s residual net worth (portfolio plus home equity) after 30 years is about twice as likely to be greater than using home equity as a last resort. Evensky, Salter and Pfieffer then published their paper in the Journal of Financial Planning the following year on how to increase the sustainable withdrawal rate using the reverse mortgage line of credit.

Moderator: Betty Meredith, CFA, CFP®, CRC®, Int’l Retirement Resource Center

1 hr CFP®, CRC®, and other CE Credit Reporting

We will report your CFP® and/or CRC® credit (no additional reporting fee) checkout.  After purchase you will receive an email with a token. Please redeem token to take this course. You will receive another email explaining where to enter your CFP® and/or CRC® IDs  You are responsible for reporting all other certifications for CE credit. 

Overall Rating: 4.6 / 5

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