Provided you meet the requirements, a reverse mortgage can put a lot of money in your pocket. Here's how to spend it wisely.
Spending Don'ts:
A Child's Wedding
The average wedding can cost $40,000. While it's tempting to do something extravagant like this for your child, before you go and spend the bulk of your payout on something such as this, it's more advised that you tackle any high interest debt that you've accrued or pay off a car or other big bill that can hinder your budget.
Mall Shop-a-Thon
Who doesn't love shopping? But in the real world, your bills should come first. It's better advice to set aside the funds from your reverse mortgage payout so that you can secure your lifestyle for many years to come and enjoy a happier, more financially secure retirement.
Depreciating Assets
If you are going to invest the funds from your payout into anything, make sure it's something that you can earn appreciation on in the long term. While tempting, fickle things that depreciate won't do much to help you retain value and won't help you secure your retirement, either.
Plausible Spending Dos:
- Home remodel - A great way to invest your reverse mortgage funds is by remodeling your home. This improves your quality of living as well as your home's value, making it a win-win situation.