Reverse Mortgage Guide

The necessity for reverse mortgages would be far less if people saved more. The grim reality is that as a country we have a negative savings rate according to the Bureau of Economic Analysis.

What this means is that year-after-year we pile up debt and borrow to secure various assets — three-year car loans now run for five or six years, 20-year mortgages are now available as 50-year financing.

Ultimately this makes no sense because lenders of every stripe want their interest and their principal. They are right to have such preferences — but how right is it not to have savings?

The richest person I ever knew, someone self-made with the income of a small UN member, once said to me: “The hardest thing in the world is to save your first $10,000. After that, it’s easy.”

Today, 30 years later and even with inflation, he’s still right.

This entry was posted on Monday, August 27th, 2007 at 7:56 pm and is filed under Reverse Mortgage . You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.