Review your finances before getting a reverse mortgage
February 24th, 2011
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Thinking of getting a reverse loan? Tapping home equity with a reverse home mortgage is one way to supplement your income and improve your financial situation. But have you taken time to give yourself a financial checkup to find other ways to improve your finances? Use the following tips to improve your cash flow.
- Shop around for a better deal on phone, cable and Internet service. The competition is fierce among companies that provide these services, so if you’ve had the same setup for years it’s time to do some comparison shopping.
- Switch to a lower-interest credit card. Doing so can decrease what you pay for finance charges and even help you pay off balances so you won’t have to rely on credit.
- Cash in rewards on your credit card. You may be able to use rewards to pay down the balance or find gift items when you have a birthday or holiday come up.
- Switch to a bank that offers free checking for seniors. Bank fees can really add up over time, so find an account that has requirements you can meet each month.
- Save more money if you are still working. Divert as much of your paycheck as you can to savings accounts while you are still bringing in an income. The closer you are to retirement, the more important it is to save.
- Revise your budget. Go through it look for areas where you can cut expenses.
- Meet with a financial planner. If you need help putting together a comprehensive financial strategy, get help from a pro who can help you plan for retirement.
- Review insurance policies. It’s important to make sure you have appropriate coverage and that you are not carrying policies you no longer need.
Investigate reverse loans
These are just some of the places to start when giving yourself a financial checkup. If you want to move forward with a reverse mortgage, make an appointment with a counselor approved by the Department of Housing and Urban Development (HUD). The reverse mortgage counselor will review your finances and help determine if a reverse loan can help you.