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Investing Blog Roundup: Reverse Mortgage Spending as a Last Resort

Reverse mortgages have a terrible reputation — possibly even worse than annuities. Despite their very real drawbacks, a reverse mortgage is often the best way for a retiree to tap into their home equity in order to fund spending without having to move out of the home.

This week, Dirk Cotton compares the pros and cons of two reverse mortgages strategies: taking out a reverse mortgage early in retirement and using that money to reduce the amount that is spent from the portfolio each year, or again taking out a reverse mortgage in early retirement but holding off on actually spending the money until it becomes clear that it’s needed (i.e., using it as a last resort).

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