March-April 2021

market is dropping can negatively affect a long-term retirement plan. To plan around that, Smith recom- mends that a portion of a retirees’ assets be positioned in what he calls “don’t-lose-money buckets” designed to provide sufficient income resources that, if needed, can be accessed to pay for expenses, such as health insurance and other retirement needs. “If the market drops, you can leave your long-term investments alone and not have to sell them.” Smith educates his clients on the various options they can consider as retirement income resources, including a reverse mortgage when appropriate, by helping them design their “financial toolbox.” “No two toolboxes are the same,” Smith says. Not everyone needs to have a reverse mortgage in their tool- box. “My job as an adviser is to educate people so they can make the most appropriate choices based on their situa- tions and objectives.” A qualified loan officer can help people to further determine whether a reverse mortgage is a good option for their individual circumstances. “If you don’t have a Plan A, you can’t have a Plan B and C,” Smith says. “You must have a plan first and look at all your options, then decide which ones work best for you.” For 2021, the maximum loan amount for a Home Equity Conversion Mortgage (HECM) is $822,375. A proprietary reverse mortgage, which isn’t backed by fed- eral mortgage insurance, could be available for people who have high home values or are younger than 62, depending on the product. Melinda Hipp, CRMP, area sales manager in Texas and Oklahoma for Mutual of Omaha Mortgage, says she includes health insurance con- cerns when she conducts education sessions with various groups. When healthcare comes up with clients, she adds, it is often with a client’s adult children when they are asking about money for in-home care for their parents. “Some children try to pay for it out-of-pocket, then find it is way too much for them to handle,” Hipp says. “The reverse becomes a godsend to them.” She also will discuss how a reverse mortgage can fund a better Medicare plan or help pay for long-term care insur- ance. Basic Medicare covers hospitalizations and doctor visits but not dental or vision care, although coverage for those can be obtained through supplemental plans. Health Insurance continued from page 25 Melinda Hipp 26 REVERSE MORTGAGE / MARCH-APR I L 2021