A bear market would make reverse mortgages smarter, two experts contended Friday at a symposium on housing wealth in retirement. If you’ve been paying your bills in retirement in part by gradually selling your equities and the market declines, a reverse mortgage can preserve your portfolio until prices rebound, they said. That advice came from Wade Pfau, retirement income professor at the American College of Financial Services and Barry Sachs, an attorney who has written extensively on reverse mortgages. But if a bear market causes the price to drop by 25 percent, you’d have to drain your holdings by an additional 36 shares to get the same income. “A reverse mortgage helps preserve a portfolio and gives it a chance to recover” said Pfau.

Source: Forbes March 25, 2018 22:41 UTC