CAI-NJ Jun.2016

LONGEVITY & YOUR FINANCES TIPS FOR A FINANCIALLY SECURE RETIREMENT By Lisa Vitiello, CPA, President Towne & Country Management, Inc.

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I f you are reading this article, you most likely live in an Adult Community. CONGRATULATIONS! You have taken the first step toward financial security by TIP # 1: Downsizing your home. Many seniors’ largest asset is the equity in their home. As most folks do, during your working years, you purchased a single family home that may no longer be mortgaged. You thus have an untapped resource of funds in the equity of this home. Even if you have not paid off the entire mortgage, the value of your home, if purchased forty (40) - plus years ago, should have significant accumulated equity. By down- sizing to a smaller home or condominium, you have tapped this resource to assist you in achieving financial security. According to data compiled by the Social Security Administration, “a man reaching age 65 today can expect to live, on average, until age 84. A woman turning age 65 today can expect to live, on average, until 86.5. These are averages. About one out of every four 65-year -olds today will

live past 90, and one out of ten will live past age 95”. Put simply, with life expectancy on the rise, you will need all of the money that you are able to save. Therefore, TIP # 2: Don’t gift your money to your kids. Here’s a better idea. Let your kids gift you your vacations, dinners, and theater!!! They have a much longer time to save than do you. If your finances are tight and you are 62 years or older, TIP # 3: Consider a reverse mortgage. Even if you downsized to your current home, you may still have equity in your home. A reverse mortgage allows you to access this equity and defer payment of the loan until you are no longer living in the home. There are other eligibility requirements with a reverse mortgage, however, so please visit www.portal.HUD.GOV. Your financial needs are different as you age. Mortgage payments get replaced by medical and dental expenses, as well as supplemental medical plans (think AARP). Therefore, TIP # 4: Prepare a new personal budget. Include CONT I NU E S ON PAGE 30

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