Rob West: Your house could be one of the most tax-efficient assets you own. Hi, I'm Rob West. For many retirees, taxes can take a significant bite out of their income, but what if the roof over your head could help you manage that tax burden more efficiently? Harland Accola joins us today to explain how a reverse mortgage may fit into a thoughtful retirement strategy, and then it's on to your calls at 800-525-7000. That's 800-525-7000. This is Faith & Finance on American Family Radio. Biblical wisdom for your financial decisions.

Well, it's always a pleasure to have my friend Harland Accola on the program. He leads the reverse mortgage team at Movement Mortgage, one of our trusted underwriters. Harland will stick around today and we will prioritize your questions on reverse mortgages. I know this is a topic that is often misunderstood, and Harland can certainly clear that up. Anyone who calls with a question on topic, we'd be happy to send a copy of his book as our gift to you. So call today with your questions at 800-525-7000. You can begin calling right now, and we'll get to those in just a few moments. Again, that number: 800-525-7000. Well, Harland, after that intro, I'm sure some listeners are wondering, how can your home actually help you lower your tax bill? So, that's, of course, where a reverse mortgage may come into play. So why are reverse mortgage proceeds treated differently than, let's say, any other source of income?

Harland Accola: Well, we refer to them, Rob, as a non-correlated asset. It's something that is tax-free coming out of a completely different account, kind of like a Roth, because it's something that, when we give disbursements, it's technically borrowed money, even though it doesn't have to be paid back for years in advance. So, it is always money that, the money that comes out of your house is always tax-free, and you don't have to worry about that showing up on your income, changing your tax bracket or your IRMAA or anything like that.

Rob West: Yeah, that's really helpful. So how can retirees, Harland, use that home equity to better manage the timing and the amount of their IRA or 401(k) withdrawals as a strategy? What does that look like?

Harland Accola: Well, when we sit down with an advisor and a client, we take a look at how much money do you need to live, and then how much is being used to making mortgage payment or what do you want to do with Roth conversions and that sort of thing. And then we look at two major things, and that is the bracket creep. Are you moving from maybe 22% or 24% up into the 30% range, which means there's a lot bigger bite taken out, and we know that that's there. It's a deferred payment that's going to have to be paid in the future. So when we bring reverse mortgage money into the equation that is tax-free, it lowers the amount that they're going to pay taxes on. And then sometimes it's used to actually pay the taxes on Roth conversions if they want to use that tool to make sure that all of their income in the future is always tax-free as well on the gains of their investments.

Rob West: Hmm, yeah, interesting. And that IRMAA, among other things, can be a big deal. That alone could be several hundred dollars a month worth of an increase if you have income that is introduced into the equation, right?

Harland Accola: Well, yes, a lot of people just say, "Well, I'm not working anymore, so I won't have any problem with the Medicare issue." And a lot of people don't even realize that their Medicare premium payment is going to be based on their income, and they just assume, "Well, my income is nothing because I've already retired." But the fact is is that any IRA income that comes out, and even over 80% of the Social Security money is taxed, and so that can increase your IRMAA, your Medicare payment because of IRMAA by sometimes thousands of dollars a year. It's a big factor.

Rob West: Yeah. Now, you also mentioned Roth conversions, which I know we talk a lot about in terms of, you know, thinking about Roth conversions between retirement and the age where you'd have a required minimum distribution. Talk about how that works.

Harland Accola: Yes, I was just talking to a lady the other day and she said, "You know, I'm so glad my house is free and clear. I don't have any debt, I owe nobody anything." And I said, "Well, you know, you do have a $1.2 million IRA and you have a big mortgage on it." She said, "No, I don't. I don't owe anything on it." And I said, "Well, sooner or later, you're going to have to pay taxes on that 1.2 million because it's an IRA." And that's when we got into the discussion with her and her advisor on what to do with a Roth conversion to avoid or eliminate the taxes that she's going to have to pay on that money coming out, because it's a required payment. It's just that we don't know how much it's going to be because we don't know what tax rates are going to be in the future, and we don't know how soon she's going to pull it out. So a lot of people that say or feel they have no debt actually have a big deferred payment for the tax folks when they start pulling that money out.

Rob West: Really helpful. We're talking reverse mortgages today, clearing up misunderstandings, thinking about this as a planning tool, and taking your questions at 800-525-7000. Back with Harland Accola after this, stick around.

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Rob West: Delighted to have you with us today on Faith & Finance here on American Family Radio, I'm Rob West. Harland Accola is here today. He's our go-to guy on home equity conversion mortgages. What is that? Well, commonly referred to as a reverse mortgage, a planning tool that should be considered, not for everyone, but can be considered as a part of a well-thought-out financial plan in the retirement season of life. Whether that's paying for a Roth conversion, perhaps better managing the timing of IRA withdrawals, not to trip IRMAA, something that could cause your Medicare premiums to go up, even something around portfolio protection that we'll get into here in a moment. But these products really shine in a variety of areas. They're most commonly used for someone who is ill-prepared for this season of life. Harland, I spoke to someone yesterday. Her husband had pulled out all the money of their 401(k). She wasn't excited about it, but he wanted to pay off all their debt as they were heading into retirement so they didn't have any more nest egg, but they were debt-free. They took their Social Security early at 65 and so they were having to live modestly. She was going back to work, but they were sitting on a home worth $400,000 that was free and clear. And, you know, that's an example where, you know, a monthly check, income for life, could be a game-changer for that fourth quarter, right?

Harland Accola: Well, there's no question, Rob. That situation is repeated literally millions of times out of the 72 million people that have their house paid off, is they feel good about that, and there's nothing wrong with that, but then they don't have the income to be able to live and, quite frankly, give the way they want to. And here there's this great big asset in an account that they really don't think about, that isn't immediately available. And all we do is make that available. We're just converting some of that equity to cash. We're not buying the house, of course, and it'll probably change her life dramatically from that perspective. And so what we try to do is get to people before they pull all their money out of their 401(k) and pay higher taxes so that they don't use that just to pay off the house. Other debt should be paid off, of course. But if the house can be converted to a zero payment, it can make a dramatic difference.

Rob West: Yeah. Harland Accola here today. He's our go-to guy on reverse mortgages. If you have a question, maybe you've misunderstood this product, you're wondering if it's right for you, you have a planning scenario maybe along the lines of what we've talked about today—any of those questions and more, we will prioritize questions on this topic. So call right now, we've got lines open. Harland would love to speak to you, and every call on topic gets a copy of his book as our gift to you. The number: 800-525-7000. That's 800-525-7000. The team is standing by, we've got lines open, you can call at this moment. Harland, what is something called sequence of returns risk, and how can a reverse mortgage factor in here?

Harland Accola: Boy, that's something that I learned, you know, I'm just a farm kid from Wisconsin who never went to college, but I hung around Wade Pfau, who's a Ph.D., a CFA, just a brilliant guy, and he really taught me an awful lot about sequence of returns risk. And it's just when you take money out. It's a fancy word for the timing of when you withdraw money from your account. Well, everybody knows that as your balance continues to go up and you're young and you don't have to pull money out, you don't really care about the fluctuations. But when you're taking money out when the market goes down, you are locking in those losses and you can never get that money back. So what he showed on his, what he called Monte Carlo simulations on the computer, is if you only take money out from your investments when the market is up, obviously your account will never go down. Well, what do you do when you need to live when the market's down for a year or two or three, like it was early in the 2000 to 2003? Well, you take the money out of your house, and then that takes care of your living expenses, which is tax-free anyway, and then when the market goes back up, you pull those gains out again. You end up with a substantially better net worth even though you're using some equity in your house, because you're never locking in those losses. If you have a 20% loss, you need a 40% gain to make it back up because your balance went way down. And people think, "Well, I'll just get a 20% gain." No, if it goes down by 20, you've got to wait for it to go back up by 40 before you're back up to the same number that you were before. It's just math. People like me, that's really get excited about that, but we've looked at a 20-year period, a 30-year period in the market, and not taking money out when the market is down can make a complete difference as to how long your money lasts and what kind of lifestyle you have.

Rob West: Yeah, that's really helpful. And that then speaks to the various approaches that you have when you're accessing home equity through a reverse mortgage, because it doesn't have to be an automatic check for life, right? In fact, that's not the most common scenario, is it?

Harland Accola: No, Rob. The most common scenario is just the line of credit. And then when people don't need the money, it just continues to grow. Unlike other lines of credit, it goes up by about 6-7% a year, and so you just leave it in there. It continues to be available, costs you nothing to have that, on no monthly fees or anything else, just, of course, the setup cost and the closing cost. But then as you need the money, you pull it out only when you need it. And some people don't pull it out for two, three, four, five years, and then there's a need because the market went down, and then they pull that money back out. Some people need a monthly income and we're certainly happy to help those that are in need, but what we're talking about is there's so many people that don't have an immediate need for a reverse mortgage. They're not broke, they're not in a situation where they're desperate, but it simply is a matter of management from a stewardship standpoint.

Rob West: That's helpful. Taking your questions today for Harland Accola on reverse mortgages: 800-525-7000. We've got a few lines open. Let's go to Indiana. Hi Cindy, how can we help?

Cindy: Hi. Yes, my name is Cindy, and we are wanting actually to put in a swimming pool in the back of our house. And we still owe 33,000 on our home, and we make $300 a month payments on that. We have IRAs that are not Roth, and we have like 700,000 in IRAs. And then we do have an emergency fund of about 20,000. And we have a corporation, but it actually pays our mortgage, the 300, but we can't take more out of it until we close the corp, and that won't be for a while. So, I didn't know, you know, if we did this swimming pool, what are your feelings on this?

Rob West: Yeah. Harland, we got about two minutes till the break. Your thoughts?

Harland Accola: Yeah, Cindy, anytime that somebody needs to do improvements to their house or regular maintenance issues or whatever, we always encourage them to use your house to pay for your house. Don't use—it's almost always the most prudent way to do things. When people pull money out to buy toys or whatever, that's not the purpose of a reverse mortgage or a home equity line of credit, even though sometimes that's what it's used for. But when you're improving the value of your house and you're putting money into the house with a new kitchen, a swimming pool, whatever the case may be, use the equity that's already in your house to pay for that. And so, obviously, I'd need to know a little bit more, but if you pull the money out of your 401(k), you're going to pay a lot in taxes. You don't want to close the corporation. So almost always the cheapest, most tax-effective way to improve the value of your house and put that money in so you can enjoy your house more is to pull that money out of your house. So, quick answer is, probably makes sense to do it that way, and simply remember the statement: use your house to pay for your house.

Rob West: And Harland, she could and would likely pay off that existing mortgage with the reverse, then make more available through the line of credit for the pool, and the payment becomes optional, but when they get down the road if they wanted to pay it off, they could, right?

Harland Accola: Well, that's exactly right, depending upon what you're pulling it out. You may want to take it out systematically because there's tax deductions as you pay the loan down, if you wish, and that'll even save you some money in taxes on the 700,000, and it'll help you build more equity in your investments because you have a more cash flow because your payment is zero, or optional.

Rob West: Cindy, thanks for your call. Hang on the line, we'll get you a copy of Harland's book. I hope that helps. David, coming your way after the break. We'll be right back.

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Rob West: Great to have you with us today on Faith & Finance here on American Family Radio. We're talking about reverse mortgages today and how the home equity you're sitting on in your home could help you reduce taxes in retirement. Used strategically as a part of a well-thought-out financial plan can not only help fill an income gap if you are ill-prepared for the fourth quarter of life, but also could allow you to be smart with the timing of how you access other assets—namely, your investment accounts during a down market year. Perhaps to fund a Roth conversion, maybe to prevent increases in your Medicare premiums. This is an often misunderstood product that can be really powerful. We're talking about that today with Harland Accola. By the way, Harland leads the reverse team at Movement Mortgage, a long-time underwriter of this program. And if you want to learn more, just go to faithfi.com/movement. That's faithfi.com/movement. Harland's also taking your calls and questions today at 800-525-7000. Any questions today on topic related to reverse mortgages, we'll send you a copy of Harland's book as our gift to you. Again, that number: 800-525-7000. Let's go out to Texas. Karen, how can I help?

Karen: Well, thank you for taking my call. Um, I'm... I'm 67, and my husband has just filed for divorce. And, um...

Rob West: Goodness.

Karen: He wants to leave me the house that's paid off. And, um, I'm... I'm relating to the woman earlier because my husband cashed in all his 401(k) to use for other investments. But, um, my pastor had mentioned to me that—because I can't keep this house by myself—um, my pastor had mentioned it was better to get a reverse mortgage estimate appraisal on the house versus like Zillow or something like that. I don't... didn't even know that was possible. Do you know anything about that?

Rob West: Yes, ma'am. You've come to the right place, and I'm so sorry to hear about what you're going through. And we would love to be able to come alongside you and help in any way we can. Harland, what are your thoughts today for Karen?

Harland Accola: Well, yes, I say the same thing, Karen. Uh, in our generation—I'm 66—and in our generation, um, a silver divorce, as that's referred to, i- is is awful. Um, and, uh, you know, the numbers—I'll talk a little bit about numbers—but, uh, I understand the emotional pain, and whatever we can do to help, we certainly will. We, unfortunately, we probably do one of these scenarios about once every week across the country. Um, it may make sense for you to stay in your house. It may make sense to sell this house and buy another one. But don't make the mistake of starting to rent, because that usually dramatically decreases your net worth when you're relatively young, uh, over a long period of retirement. So what we do is we either help you by giving you money that's coming out of your current house so you can afford to stay in the house, if it's not a house that makes sense for you to be there long term, we help you buy a house with a reverse mortgage and put money into an investment account or a savings account for you that you have for the future. So I don't know what the best route is, but, uh, it's at a crossroads. And maybe you should stay in the house that you're in, and we can pay you something monthly to take care of the, uh, the income that you've lost, or we'll have the house sold and then be able to create an investment, uh, that will take care of your monthly income. So, either way, uh, big decision at this point, and we'd be happy to give you all of your options. And when you ask are asking about the appraisal, we do do appraisals. Zillow sometimes is correct and sometimes it's way off. But we do an actual appraisal to go through that, so your pastor is correct. Uh, that's something we do. You don't You don't order the appraisal, we do as part of the process. Um, so don't pay for an appraisal separately because it's not something that any other lender can use.

Rob West: Yeah. Uh, Karen, I'd love to do several things, uh, to come alongside you and support you. Number one, I want to send you a book called Wise Women Managing Money, uh, just, uh, to be an encouragement to you as you step into managing fully the financial resources God has entrusted to you. I think this book will be helpful to you. Second, we'll send you a copy of Harland's book. Um, but third, uh, the team can get your information, and if it would be helpful, we can connect you with Harland or his team directly so that they could just help you explore your options. And, uh, doesn't matter which direction you decide to go, they just really want to be able to serve you and support you during this period of transition. So, Karen, hang on the line. Again, we'll be, uh, we'll ask our Faith & Finance community to be praying for you, and, uh, if we can help further along the way, don't hesitate to reach out. Hold the line. Uh, let's go to Louisiana. By the way, we do have some lines open taking your questions for Harland Accola today on reverse mortgages. If you have a question about your situation, maybe you've have heard, uh, things about these products over the years that have concerned you or you want to clear something up, call right now: 800-525-7000. David, how can we help you, sir?

David: Good morning, gentlemen. How are y'all?

Rob West: Hi there.

David: Hi. Um, I'm 59 years old. Our house is paid for, uh, free and clear. Uh, my wife wants to purchase another house, uh, which is at a lower value than our house is. And, uh, we only have one income, and that's my disability, which is $994 a month. And I just, uh... I know I'm going to be y'all's head-scratcher for today, but, uh... I'm just looking for advice on what to do or in which way to go. I have no retire- I have a little retirement from a job that I retired from, uh, but I can't draw that until I'm 65. Um, I just need some advice on which way to go, gentlemen.

Rob West: Yes, sir. Well, I appreciate that. Harland, we have just a minute, so maybe you could give some initial thoughts, and then we'll pick it up on the other side of the break. Go ahead.

Harland Accola: Yeah, David, there's no question that most of your wealth is contained in your house, so it's great that it's free and clear, so you have no payment, of course. But then you're only living on $994 a month. Maybe it makes sense to to downsize to this other house and and create some money. Uh, just like we said to the previous caller, maybe it makes sense for you to sell this house and buy a house with a reverse mortgage so that you have more money to replenish the investment account that is kind of at zero right now. So, uh, be happy to go through several different things. We do a Bucket 1, 2, and 3 analysis with any uh clients that call in just to see whether or not it makes sense. It would seem to me that you want to that you really need more cash than equity, and there's a lot of equity that is most of your wealth is in your house, so we'd be happy to look at some options for you.

Rob West: David, stay right there. We'll talk a bit more after the break. Harland Accola here today. Much more to come, just around the corner.

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Rob West: Harland Accola is here today. We're talking reverse mortgages. I'm Rob West, this is Faith & Finance on American Family Radio. We've got some lines open if you have a question, call right now 800-525-7000. Every call on topic today, we'll send you a copy of Harland's book, Home Equity and Reverse Mortgages, as our gift to you. Before the break, we were talking to David. David, Harland shared some thoughts on your situation and how you might think about that. Give us your reaction to that, and any follow-up questions you have, sir.

David: Yes, sir. Well, we've already went through all the process of all the paperwork on the house. We've done estimates on the house. We've gotten all that done. We have a property attorney that's working with us. My wife tried some crazy idea of going to LoanDepot, and that's not working out. For some reason, they're saying our paperwork's not correct, but our attorney is saying it is. So, we're trying to move forward on this. I'm very interested in this program. For one thing, it's Christian-related. I mean, that's my main aspect of this. I just need some advice on—I gave my email address, if y'all could just email me your information, how to get in contact with you guys, and how I should move forward.

Rob West: Very good. We can certainly do that. Harland, anything you didn't get to share before the break?

Harland Accola: Yeah, I was going to say that depending upon—I didn't catch the state that you're in.

Rob West: He's in Louisiana.

Harland Accola: In Louisiana, okay. So, there's reverse mortgages that start out at 55, and then there's some that go to 62. It may be something that you want to do a traditional mortgage or pay cash for the house—the new one—for a few years and then go to the 62. So in your situation, we'd look at it, be careful about just jumping into something that really doesn't suit long-term—the 55-year-old mortgage instead of waiting for the 62-year-old mortgage. So I neglected to mention that depending upon the age and what your wife's age is, we'd work back and forth as to what would make the most sense in Louisiana, but you'd have options both ways. So, I'm glad you put your email out, and this is a complicated situation that you'll probably only do once more in your life. We'll certainly go through the details because you want to be careful. What this decision will probably impact your retirement more than anything else that you do from a financial standpoint. So, we'd be glad to go into more detail. There's so many loan officers that just say, "Oh, I think you should do this," or, "I think you should get this product." We will refuse to do that until we've asked a whole lot of questions. That's really the key thing so that it's put together thoughtfully, that fits in with Christian values as to how it works for not only for you, but also for your wife throughout your retirement.

Rob West: Mmm, very good. David, we'll get—I think the team has already gotten your information, so we'll get somebody in touch with you. But we appreciate your call today, sir, and thanks for being on the program. 800-525-7000 is the number to call. We've got still some lines open. We'd love to hear from you today. We're prioritizing questions on reverse mortgages today while Harland Accola is here. Luana is in Illinois. Go ahead.

Luana: Hi. Thanks for taking my call, Rob, and hi, Harland. I was wondering, what's the difference between a home equity line of credit and the reverse mortgage? Because I was looking to do bathroom renovation and then clear some trees off of the property.

Rob West: Mmm. Yeah, Harland?

Harland Accola: Well, thank you for asking that, Luana, because that's such an important issue. Home equity loans are available for anyone at any age. Reverse mortgages are only available for past 62. Both of them are lines of credit and can be set up as lines of credit. Once you get past 62, it is much safer to have a reverse line of credit, even though it costs more for closing costs, because you're not required to make payments, number one. Number two, it cannot be ever taken away as long as you're paying your taxes and insurance and you're alive and living in the house. And thirdly, it's always guaranteed to go up in value. Many people had their lines of credit canceled in 2008 to 2012 when the major crisis happened. No one lost their reverse line of credit. So when times are tough, the reverse line of credit will always be there whether times are good or bad. So this is something you don't want to go into any retirement planning without having that protection and that safety of knowing that you don't have to make a payment if you don't want to, and that it will always be there. People that lost their houses in California in the fire, there was about 21 reverse mortgages there—all of them are still active, and people are drawing on that line of credit even though their houses are ashes as they're trying to rebuild. That does not happen with any other line of credit because of the federal guarantees that are with the reverse mortgage. So, dramatic differences between the two different products. Thank you for asking that question. Many people need to know that because they seem similar, but they're very, very different.

Rob West: That's fascinating about the California wildfires, Harland. I had not heard that. That's just really interesting, isn't it?

Harland Accola: Yeah, that's what non-recourse means. No matter what happens, the money is available.

Rob West: Wow, interesting. Luana, is that helpful, and did you have any follow-up questions with Harland?

Luana: Just one more. With a reverse mortgage, how is the interest rate calculated?

Rob West: Mmm, yeah.

Harland Accola: The interest rate is usually a little bit lesser expensive than the regular lines of credit. Most lines of credit right now run between 7% to 10%, and the reverse mortgage is usually between 6% and 7%. So, even though it's more expensive to set up, the ongoing interest costs are lower. And of course, there is no payment. On a regular line of credit, you have to at least make the interest payments, and then after 5 years, typically it goes into a fully amortized loan. So, usually the long-term costs are cheaper with a reverse mortgage because the interest is lower than on most lines of credit.

Rob West: And Harland, that rate will move—it is variable. So if rates come down, it will come down with it, right?

Harland Accola: Yes, it comes down automatically, and it's probably more likely that rates will come down than go up. Some lines of credit have a fixed rate for younger people; ours are always adjustable because it goes up and down based on the current interest rate. So, when rates go down, you don't have to refinance and spend the money to refinance—it automatically goes down.

Rob West: Yeah, very good. Luana, thank you for your call today. I know we've already got your information, so we'll get that book right out to you, and we appreciate you being on the program today. We're going to continue to take more phone calls in the final segment, so if you've not called and you have a question, now would be a great time to call: 800-525-7000. Again, that's 800-525-7000. Anything in particular, Harland—just a minute before our next break—related to this topic of how to think about accessing this tax-free income as a financial planning strategy? Any other quick strategies you could mention that we haven't covered?

Harland Accola: Well, yes. The biggest thing is, a lot of wealthy people—everybody thinks about reverse mortgages, of course, as something that helps out in-between times when people have a little bit less. But most people don't realize that the biggest expense in retirement for people that are wealthy or that have investment accounts, their biggest expense is typically taxes. There's so little planning that goes around the taxes, and I know we just talked to a wealthier client today that heard about us through Faith & Finance and is concerned about his tax bill with 1.5 million in the numbers. After we went through his plan, we know that if he lives to be 87—he's 65 now—he'll save about a half a million dollars in taxes. He said, "I just never looked at that. I just figured that that was something that I had to do." But you have options.

Rob West: Yeah, amazing. That's exactly right, what a powerful example. Sherry, Anna, coming your way after the break. We'll be back with much more in our final segment with Harland Accola right after this. Stick around.

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Rob West: Great to have you with us today on Faith & Finance here on American Family Radio. I'm Rob West. We're talking reverse mortgages today, and how they can be leveraged as a financial planning tool in the fourth quarter of life if you're 62 or older, and have, generally speaking, more than 50% equity in your home. It can be used to supplement other assets or as a key means of provision if you are ill-prepared for that season of life, providing some flexibility either by paying off an existing mortgage and no longer having a payment, or by having funds available for home improvements and other needs during that fourth quarter of life, or as a monthly check to provide a really vital element of additional income on a monthly basis just to give some breathing room. The number to call today with your questions is 800-525-7000. Let's go right back to the phones. We'll head to Arkansas. Anna, how can I help?

Anna: Uh, yes. Um, I am 70 years old and have just—I do have a master's in counseling and have had to step out of the work field due to having to have some surgeries. And right now I'm in a protective mode toward my son and my grandson. My son is a single dad who is—been on a—in a field of earning that makes his earning inconsistent because there's gaps. Um, and I only owe about $62,000 on the duplex that I own right now. Um, but I'm concerned about my health and his inconsistency, and if—because I have no 401(k). My husband left me um about 15 years ago unexpectedly, and um has, you know, we worked in Christian-type jobs so that we—we just did not develop a 401(k) or retirement, which is—we do have real estate that's uh free—land free and clear that's um about 15 acres I own in a good area. And then I have the duplex, and then I have one other condo, but the mortgage on it is still $90,000 and it's not eligible for reverse mortgage. But I'm just wondering with the instability of my health and needing to protect this little guy that's an honor student um to be under my roof, um if reverse—it's complex to me. I don't know if I understand uh exactly what would happen with that.

Rob West: Yeah. Well, thanks for sharing that. I know you're carrying a lot. Harlan, uh your thoughts on all that?

Harlan Accola: You certainly are um uh have a lot of burdens, and I admire for what you've been able to do as a single lady to navigate through these things. Um the issue is is that you have a lot of money in illiquid assets that still require you to make payments on two different mortgages. Um and certainly having an optional payment mortgage would take a lot of the pressure off, and that you could be of help not only to yourself, uh that you could work if you wanted to, but didn't have to, as well as being a benefit to your son. Um so when you do the reverse mortgage, you don't give up ownership of your house. We simply allow you to make payments if you wish, and if you don't want to, you never have to until you pass away. Um we help you kind of make plans as to what after you pass, what would happen to your son and your grandson. And uh most of the time, uh kids need help more so while Mom and Dad are alive than after they're gone. And so certainly um there's things you can do right now to alleviate pressure for him and for you. Uh with your other real estate and some of the things that are there, maybe it makes sense to use some of the money in your house to pay off the rental property so you can use more of the rental income. I don't know, but those are just a couple of the things that we'd investigate. It would certainly be worthwhile to go into your situation, which is a little bit more complex than some with land and investments and duplex and so on. But um it would seem to me that this is something that you should definitely investigate and take a lot of worry off your mind and burdens off your shoulder.

Rob West: Mm. Very good. Uh we'll get you a copy of Harlan's book, Anna. If you want to learn more, just head to faithfi.com/movement. I know the team would be delighted to visit with you and help you navigate uh the complexities of all of that. And we appreciate you being a part of the program today. Thanks for calling. Uh let's go to Oklahoma. Sherry, how can we help you?

Sherry: Uh I I just uh until now, I just thought, "Oh, no. We don't want a reverse mortgage. We want to pay our house off and leave it to our son free and clear." But in listening to the two of you, I'm thinking, "Well, maybe we should at least look at it." [chuckles] Uh so that's the reason I called. I would like to know more about it.

Rob West: Yeah, very good. Well, I think certainly that is one approach. You know, we talk a lot about becoming debt-free and we're big fans of that. And a lot of people decide that's the the most appropriate approach for them. Others who haven't saved much, uh you know, need that additional support and income or line of credit to just meet their basic needs or have a little breathing room. Others use it, as we talked about at the start of the program today, as a means of a financial planning tool to make sure that they're coordinated and how they access other assets, and using reverse mortgage to uh, you know, make that more efficient. And that's certainly one approach here. Um but give us just a quick rundown of your your situation in terms of what are your income sources and um what assets have you accumulated at this point?

Sherry: Well, both of us are drawing Social Security. My husband waited until he was 70 to draw it. Uh I signed up when I was 65 and uh needed Medicare, needed health insurance uh because I'm a three-time cancer survivor, so anyway, was thankful to be able to get some insurance. Um my husband is working. He's in his second career. He earned his engineering degree while climbing towers, so I'm really proud of him. He's a contract engineer tinkerer here in in Oklahoma City, so he's still earning an income and both of us draw our Social Security, so we're doing fine right now. But we're he will be 77 in September. He's still enjoying his job, but I'm thinking he might maybe he'll work for another year or two, but just trying to think ahead and be ready for that time when he's no longer earning an income.

Rob West: Yes, ma'am. And what retirement assets have you all accumulated, roughly?

Sherry: Well, he has a 401(k), and basically that's it. And then of course our home, um we owe oh maybe $17,000 on it, and um so whatever, well, I think it's, you know, I think it's worth maybe $300,000, I'm not sure, but uh...

Rob West: Yeah, very good. Harlan, uh your thoughts on their situation?

Harlan Accola: Well, first of all, I admire your attitude, uh uh Sherry, because a lot of people just automatically tune it out like I did many years ago and just said, "No, it's just bad. You don't need it and you shouldn't have it." Um and so just having the idea of investigating it, not whether or not you do it. A lot of people never even set up a meeting to talk about it, and so I admire you for doing that because you're planning ahead. Uh I have one of my favorite Bible verses is in Proverbs that "The prudent see danger and take refuge, but the simple keep going and pay the penalty" in in Proverbs 27. And so you're looking ahead and more people need to do that. And so whether or not it makes sense now or in the future, you should check it out because you don't have a lot of other money in those places and you're dependent on his income. And so I'm not saying that you should definitely do one, but um it would to investigate it and find out and look forward to the future, uh it's it's something you really should check into because a lot of assets, you know, hundreds of thousands of dollars, is sitting in your house that are not released to be able to use. And if you set up a line of credit now, um then it grows every month that goes by. And so even if you don't need it until your husband decides to quit working, and uh fantastic and kudos to him uh for doing what he's doing as an engineer at 77, that's pretty impressive. But at least have him in a position where he works because he wants to, not because he has to. Uh and that's often what we do is that people aren't ready to quit working, but hey, this is a safety gap that's there. And if you set it up early, then it'll be worth more a year from now, two years from now, three years from now, whenever he does decide to retire. So it is something that I'm glad you have uh wanted to check out, and we'd be happy to give you what some of the options are as to how that would affect uh things today and years from now. So thank you for calling in, because so many people don't come to us until they're in trouble, and then sometimes we can't even help.

Rob West: Yeah, that's exactly right. Sherry, thank you for your call today. We've got your information. I think this book will be helpful for you as well. Harlan, uh you know, really um lays it out and and goes through a lot of the misconceptions, and explains what this product is. And I think that will uh help you sort out fact from fiction, and we'll get that right out to you. Uh Grant, Rebecca, Brenda, Matt, thank you for your calls. We will send you a copy of Harlan's book. I apologize we didn't get you on today, but he'll be back real soon. Harlan, as we uh tie a bow on this, kind of coming full circle to where we started today by thinking about this as a financial planning tool, what uh parting thoughts do you have for us?

Harlan Accola: Well, what most people don't realize is that this is like a Swiss Army knife. There's all kinds of different options, and too many people put it in a very narrow category that the best way to use a reverse mortgage is when you're broke and you need money. And we're always happy to help those people and do whatever we can if somebody's in foreclosure or somebody's lost a spouse to divorce, unfortunately, that we talked about earlier. But um people just have to realize it comes down to stewardship that you've written about in your book, The Ultimate Treasure, that everything that we have uh has been given to us by God, and it's up to us to steward it. And so many people ignore that they need to steward all of the equity in their house, which is so valuable and that they've been gifted with from God as well. And that's just what we love to do is say, "Well, how can this make your life better? How can this increase your standard of living? How can it increase your giving?" uh which many people do after they do a reverse mortgage. And we're just thrilled to be part of that journey and give all of the different options that people haven't even thought about.

Rob West: Well, Harlan, we're grateful for our partnership, this uh long-standing relationship. Thank you for doing such a great job just to educate God's people on this topic, and we appreciate your time today, sir. God bless you.

Harlan Accola: Thank you. God bless you and your listeners.

Rob West: All right, that's Harlan Accola. If you want to learn more, just go to faithfi.com/movement. That's faithfi.com/movement. Big thanks to my team today: Taylor, and Patty, and Devin, and everybody here at Faith & Finance that makes this possible. I trust you found something helpful and useful. Hope you'll come back and join us tomorrow. We'll do it all over again. Until then, as Harlan said, let's make God our ultimate treasure, make money a tool to accomplish God's purposes. Thanks for being here today. God bless you. Bye-bye.

Announcer: The views and opinions expressed in this broadcast may not necessarily reflect those of the American Family Association or American Family Radio.

Your house could be one of the most tax-efficient assets you own. For many retirees, taxes can take a significant bite out of their income. But what if the roof over your head could help you manage that tax burden more efficiently? On this Faith & Finance on AFR, Rob West and Harlan Accola explain how a reverse mortgage may fit into a thoughtful retirement strategy. Then, it’s on to calls.

(00:00) Rob West & Harlan Accola from Movement Mortgage discuss using home equity to reduce taxes in retirement
(08:30) Rob West & Harlan Accola continue their conversation on using home equity for income
(14:35) Caller Cindy: Retired on social security, want to put in a pool. Is it better to use money from IRA or do a reverse mortgage
(21:50) Caller Karen: 67 years old, husband filed for divorce and is leaving her the house. She cannot afford the home. Would a reverse mortgage allow her to stay in the house
(26:00) Caller David: House is paid off. Looking to sell and purchase a smaller house. What are his options
(31:10) Rob West & Harlan Accola continue their conversation with David
(34:53) Caller Luana: Differences between a home equity line of credit and a reverse mortgage
(39:05) Harlan Accola emphasizes that the biggest expense in retirement is taxes
(43:09) Caller Anna: 70 years old, concerned about her health and son’s instability. Has no retirement savings. Could a reverse mortgage be of benefit to her
(47:01) Caller Sherry: Couple in their mid 70s looking to retire. Would it be better to pay off their house or get a reverse mortgage