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Don’t Ignore the Warning Signs

Posted on by Linda Fau

When we begin to notice changes in the behavior of a friend or family member, we should step back and evaluate the cause and possible consequences. We may not notice the warning signs and consequently wait too long to address them. The result of this can be devastating.

Senior Financial Life’s team of advisors and professionals can help to plan a careful strategy to avoid being caught off guard when there are changes in life. Contact us today to find out how.

Take note of these eight warning signs that should not be ignored.

POOR EATING HABITS
Weight loss
No appetite
Missed meals
Empty cupboards and refrigerator

NEGLECTED HYGIENE
Wearing dirty clothes
Body odor
Neglected nails and teeth

NEGLECTED HOME
Scorched pots & pans
Unopened mail
Piles of laundry, papers, dishes, etc
Dirty bathrooms, floors, tables,
excess clutter

INAPPROPRIATE BEHAVIOR
Angry outbursts
Quiet or withdrawn
Paranoia
Making phone calls at all hours,
inappropriate times

MISHANDLED FINANCES
Losing or misplacing money
Paying bills twice or not at all
Hiding money

HARMFUL BEHAVIORS
Misuse of alcohol or medications
Missed appointments
Falling
New relationships with strangers

DECREASED PARTICIPATION
Not attending regular activities,
senior center, church, clubs
or volunteering

CHANGED RELATIONSHIP PATTERNS
Isolation
Ignoring friends
No interaction with neighbors

Where Should I Live in Retirement?

Posted on by Patti Goldfarb

Where to live in retirement sounds like a simple question but ask anyone what criteria they would consider if they were going to move to a condo/home in retirement, and you will likely get a blank stare or “we haven’t thought about it yet”. I did a quick internet search on what to consider when choosing a place to retire, and here are the factors that came up.

Family and Friends

Location

Transportation

Accessibility

Evaluating Needs

Floorplan

Medical Care

Senior Living Culture

Social Activities

Cost of Living

Financial Considerations

Safety Features

Community, Dining and Nearby Amenities

Within each of these categories are multiple choices, so this is no small task to figure out. Today I want to explore the one thing that I notice most couples do not consider at all. What happens if/when one of the spouses dies or has a serious health concern? Anyone that’s been there knows your world will change right then and there. When a spouse dies typically 50% or more of the monthly income disappears overnight but most of the household expenses remain.

As a retirement mortgage specialist, I encounter this scenario a few times per month. When it’s a case of one spouse needing medical attention and they want to remain in the home, sometimes there is enough value in the home that can be released to support in-home healthcare, however that’s not always possible. When there is a death, the surviving spouse often wants to remain in their home but cannot afford the monthly costs of being there. More often than not it’s financially best to sell the home and relocating to an area where homes are less expensive to purchase and the carrying costs to live there are lower than the current home.

I have also observed that most individuals and couples are unaware of their monthly expenses. Getting a handle on this before an unexpected illness or death occurs will allow a clearer picture and less anxiety about one’s options when this happens.

Contact me to help you or a friend, family member or client to get the clarity necessary to successfully navigate one of the most impactful decisions about your retirement.

Mark Richards
NMLS # 254317 Fairway Independent Mortgage Corporation
Phone / Text  201-679-2734 Email mrichards@fairwaymc.com
Hackensack, NJ Reverse Mortgage Planner – Mark Stephen Richards (fairwayreverse.com)

What?  I Can Sell My Life Insurance Policy?  Why?

Posted on by Patti Goldfarb

Yes, you can sell your life insurance policy!  2.5 million seniors a year will lapse or surrender their life insurance policies…walking away with little or nothing.  Why?  Because they no longer want the policy, no longer need their policy, and don’t know they can sell their policy for cash.  All types of policies can be sold, including term policies…yes, even term policies.

Selling a policy is done through a life insurance settlement, which simply put, is the sale of a life insurance policy to a third party (usually an investor group.   The benefit is that clients receive a lump sum payment that is 3 – 5 times greater, on average, than the surrender value of the policy. 

So, now, why would anyone sell their policy?   People purchase life insurance for many reasons – to pay off a house, pay estate taxes, give a spouse or loved one an income – if something should happen to them.  And, sometimes, the reason a policy was purchased 5, 10, 20 or even 30 years ago, is no longer a concern.   A client may have retired and their home is now paid off, the kids are now out on their own, a term policy is nearing the end of the term, a business has been sold – making the policy unnecessary.   Premiums can also become too expensive to maintain the policy.  Whatever the reason, the policy is no longer needed or wanted.

But, is it legal?  Yes!  Surprising to most people, it has been legal in the United States since a 1911 U.S. Supreme Court decision called Grisgby v. Russell.  But, not much happened until the 1980’s.  Today, the life insurance settlement market is highly regulated by Departments of Insurance across the country.

Once a client receives their settlement money, they can do anything with it they like:   save for retirement, donate to charity, pay for home care or assisted living, take that dream trip….anything!  90% of surveyed seniors who have let their life insurance policy lapse would have considered selling it had they known a life insurance settlement existed.  We can help.  If you no longer need, no longer want, or can no longer afford your policy,  consider a life insurance settlement.  We can help.

Home Equity Conversion Mortgages (HECM) Help Consolidate Debt

Posted on by Patti Goldfarb

As with any home mortgage loan, there are closing costs, and the borrower must eventually repay the borrowed amount, plus interest and fees. However, several powerful HECM features make it a unique option to consolidate debt in retirement.

  • Eliminate monthly mortgage payments while owning the home
  • Consolidate other debts
  • Flexible payment to or from the borrower
  • Shift mortgage debt from the homeowner to the home
  • Safeguard heirs

Borrowers can use HECM loan proceeds to consolidate other debts (high interest credit cards, auto loans etc.), freeing them of the burden of those required monthly principal and interest (P&I) payments. So long as they meet the HECM loan terms, which include living in the home as the primary residence and paying property related charges like taxes and insurance, borrowers can continue to defer repayment of the loan balance. That can be a real game changer for your retirement cash flow strategy.

As a HECM is a mortgage loan, it shouldn’t be viewed as free money to apply toward debts. However, if the HECM frees up enough cash to enable the homeowner to settle their debts, or at least make those debts manageable, it can greatly benefit the borrower. As the home sale typically pays the HECM loan balance once it matures, consolidating debt with a HECM is akin to shifting debt from the homeowner’s monthly cash flow to the home itself.

Another major difference between using a HECM to consolidate debt and a traditional loan product is the potential impact to heirs. As HECMs are non-recourse loans, the borrower will never have to pay out of pocket to satisfy the HECM because the home stands for the debt.

Pros of Using a HECM to Consolidate Debt

  • The borrower retains full ownership of the home
  • The borrower can pay off creditors, potentially increasing their monthly cash flow for the things they need or want thanks to the flexible repayment feature
  • Homeowners can eliminate obligatory monthly mortgage payments (must still pay property charges like taxes, homeowner’s insurance and home upkeep)
  • If the homeowner’s mortgage payments are highly burdensome, the above feature can be incredibly useful for managing debt and increasing cash flow
  • Flexibility for the homeowner to tailor their loan payout (if applicable) to best tackle their debt
  • The home stands for the debt, protecting the borrower and heirs from personal liability for payment due to the loan’s non-recourse feature

Cons of Using a HECM to Consolidate Debt

  • The unpaid reverse mortgage loan balance grows over time as interest and fees get added to the unpaid loan balance. Most other types of loans require monthly P&I payments, which decrease the loan balance over time and thus reduces your borrowing costs. Note: With a HECM, you do have the option to pay down the loan balance at any time paying as much or as little as you like
  • Fees and closing costs: The upfront costs tend to be higher for a HECM than other types of debt consolidation loans not secured by your home
  • You’re drawing down on your home equity, which likely means your heirs will have less money (or no money at all) coming to them from this particular asset. However, by strategically tapping home equity first, you may be able to extend the life of your other productive assets, potentially leading to a greater net worth to leave to your family.

*This article does not constitute tax/financial advice from Fairway. Please consult a tax/financial advisor regarding your specific situation. There are some circumstances that will cause the loan to mature and the balance to become due and payable. Borrower is still responsible for paying property taxes, homeowner’s insurance and maintain the home. Credit subject to age, property and some limited debt qualifications, program rates, fees, terms and conditions are not available in all states and subject to change. Copyright 2023 Fairway Independent Mortgage Corporation (“Fairway”) NMLS 2289, 4750 S. Biltmore Lane, Madison, WI 53718, 1-866-923-4800. All rights reserved. Fairway is not affiliated with any government agencies. These materials are not from HUD or FHA and were not approved by HUD or a government agency. Reverse mortgage borrowers are required to obtain an eligibility certificate by receiving counseling sessions with a HUD-approved agency. The youngest borrower must be at least 62 years old. Monthly reverse mortgage advances may affect eligibility for some other programs. This not an offer to enter into an agreement. Not all customers will qualify. Information, rates and programs are subject to change without notice. All products are subject to credit and property approval. Other restrictions and limitations may apply. Equal Housing Opportunity.

Respite Care

Posted on by Linda Fau

Family Caregivers Need A Vacation Too!

At-Home Respite Care to the Rescue

Being a caregiver for an older loved one can be very rewarding. The truth is as much as we long to give our best, caregiving is exhausting! Being a family caregiver is likely not something you expected. The challenges can seem overwhelming at times. It’s perfectly normal to feel like you need a break. Carving out time for yourself is essential for your well-being. A family vacation or getaway with friends is often just the remedy needed to rest, refuel and reconnect with your thoughts and feelings.

You may be asking “How can I find someone to properly care for my loved one so I can
plan for time away?” Carving out time for yourself can be difficult, especially with the
added demands and responsibilities of work and family. That’s where in-home respite
care comes in! In-home respite care is an option that allows older adults to remain in
the familiar surroundings of home while you’re away. The New Jersey Department of
Human Services does provide some assistance for those in need of respite care
however there are stipulations and limitations. There are respite care opportunities in
senior living communities and nursing homes but most people prefer to stay
home and avoid the upset of a temporary move to unfamiliar surroundings. For a pleasant experience for both your family and your loved one, home respite care is the answer.

What Are the Advantages of In-Home Respite Care?

Respite care or short-term assistance given by a home care professional caregiver
(Certified Home Health Aide, CHHA) is a wonderful way to get that time away and worry
less, knowing that your loved one is well taken care of. It can be helpful for other
occasions as well, such as weddings, business trips, unexpected events or anytime
when you need a qualified caregiver to step in and take your place.

Visiting Angels Home Care has a multi-level approach with the tools in place to
provide quality care for your loved ones. Our care team has been
developed to provide continuity of care that includes:

● Nurse Supervision – a nursing assessment is done and a customized care plan is
created with your loved ones needs and desires in mind.
● Client-Caregiver Liaison – The liaison is in place to address any concerns you,
your loved one or the caregiver may have concerning your loved one.
● Certified Home Health Aides – trained to provide your loved one with
compassionate care with dignity and respect.
● Support Staff – who are in place 24/7 to address any concerns regarding your
loved one while you are away.

So what are you waiting for? Take that vacation, reconnect with friends, say yes to the
business trip. A respite care plan will allow you to get some rest and relaxation, take
care of business and maintain your sanity. Avoid caregiver burnout! You will be a better
family caregiver if you give yourself time to refuel. Entrust your loved one into the
capable hands of Visiting Angels.

Visiting Angels is committed to providing your loved one the highest quality care with compassion, dignity and respect. We are licensed, insured and recognized for excellence in home care. We offer flexible scheduling options that range from hourly care, round-the-clock and live-in assistance. Schedules can be arranged a few times a year or on a recurring basis. Once you try Visiting Angels you may decide that the continuing with our services are a worthwhile investment for your family. An established relationship with Visiting Angels will remove the stress and provide the optimal lifestyle for your loved one.

Eliminating Debt

Posted on by Patti Goldfarb

Eliminating Debt

Extinguishing Non-Housing Debt with Housing Wealth

There are households with a low mortgage interest rate but tens of thousands of dollars in high interest credit card debt and other loans leaving them with less than a desirable amount of cash- flow. Many might resist even considering a refinance because mortgage rates currently being offered are much higher than what they currently have.

A cash out refinance could be a great solution to help them. They could possibly increase their monthly cash-flow, pay off their mortgage sooner which seems kind of counter intuitive, simplify their finances, improve their credit score, grow their wealth/savings or a combination of these results.

An example, Bob & Mary refinanced their loan back in 2020 in the 3% range and currently owe $336,350. They have $42,000 in credit card, student and auto loans that are costing them $2,426 per month. There are at least 3 paths we can take here. Here are the most obvious to me.

  1. By refinancing their existing loan balance and pulling out an additional $42,000 at a new rate in the 6% range, the monthly non-mortgage debt would be eliminated. As a result, Bob & Mary now have freed up approximately $491 per month.
  2. By refinancing and paying off the non-mortgage debt and taking the $491 in savings and putting down the mortgage balance monthly, Bob & Mary will pay off that mortgage in 19.25 years versus the 26.75 year pace they were on. So, without spending any more total dollars they will shave off over 7 years of mortgage payments.
  3. Another option is putting that $491 per month into an investment account. If that account achieved a consistent 5% annual return all years, it would have accumulated almost$131,000 after 15 years. *

As with most financial questions, the right decision depends on one’s circumstances, discipline and goals. A certified mortgage advisor can help evaluate each individual financial situation and determine if a cash out refinance is the right choice for them.

*The information contained herein is distributed for educational purposes only. Fairway does not guarantee a mortgage loan will result in equity gains or other advantages. Any potential benefits from homeownership are based on individual factors. Contact your Fairway loan officer for more informationregardingyourspecificsituation.Thisisnotanoffertoenterintoanagreement.Notall customers will qualify. Information, rates and programs are subject to change without notice. All products are subject to credit and property approval. Other restrictions and limitations may apply.

MarkRichardsLONMLS#254317. Licensed by the NJ Department of Banking and Insurance. Licensed Mortgage Banker- N.Y.S. Department of Financial Services