Liquidity versus Marketability

One aspect of investing should be pointed out. There is a big difference between accumulating money and investing money. While accumulating money, you typically have access to your funds with either low penalties or no penalties at all. This is referred to as having liquidity. This allows you to have access to your funds with the assurance that you will receive at least your principal at any given point. With most financial investments, such as stock mutual funds and bond mutual funds, you are...

Having the Wrong Type of Life Insurance

M any retirees have done a good job accumulating and investing assets. Hopefully, they have taken measures to protect and preserve their wealth for themselves and their heirs. When the topic turns to life insurance, however, many retirees tune out. They have been conditioned to think of life insurance as death insurance or as just a necessary evil in their portfolio. Unfortunately, this attitude can lead many retirees to skip over this area of their personal and business planning. Years ago,...

How Much Can You Borrow

The amount of equity you can access via a reverse mortgage will depend on the program you select and other major factors such as Your age (and that of your spouse, if applicable) Typically, for the average homeowner, the federally insured Home Equity Conversion Mortgage or Fannie Mae's Home Keeper mortgage provides the most access to your home's value. You must also determine how you wish to receive your funds. Your options are many and vary depending on the program you select. It pays to shop...

Know Your Time Horizon

The lesson is clear look at a longer time horizon for your investment dollars. Realize that you or your spouse may live many more years. Make sure there are adequate funds to support you. Chapter 6 reveals why you want to avoid taxes and allow your funds to grow as quickly as possible in tax-favored vehicles. An old rule of thumb was to take your current age and make that the percentage amount of your portfolio invested in fixed investments. Thus, a 60-year-old would place 60 percent of his...

What Is a Reverse Mortgage

Under a traditional home mortgage, a borrower receives funds from a bank to purchase a home. Monthly payments of principal and interest are made to the lending institution each month. This payment represents mortgage debt and must be paid back in a timely fashion. A reverse mortgage, as the name implies, is quite different. Instead of paying the bank or lending institution, they pay you. They take into account the value of your home and use that information to calculate how much they can...

Systematic Withdrawal

The systematic withdrawal method is a creative concept that could improve your standard of living now, while serving your heirs later. This concept states that you do not strictly look at what income or dividend yield an investment could provide. What you look at is the overall total return of that investment over prolonged time periods. This total return takes into account the income as well as the underlying growth of the investment. Regardless of market performance, you could generally take...