Ecology of Money

Why Reverse Mortgages May Make Sense as Retirement Funding Tools

John F. Wasik

Few, if any, retirees like the idea of going into debt to fund retirement. Yet with more and more households coming up short on cash savings, millions of retirees have turned to reverse mortgages as a source of retirement income.

Although hardly ideal for financing retirement, reverse mortgages may help close an estimated $4 trillion retirement funding shortfall, according to an estimate by the Employee Benefit Retirement Institute.