Using home equity for retirement income

Article Abstract:

Home equity has become a retirement income resource because of low personal savings and increases in real estate values. The equity can be accessed through a sale/leaseback arrangement with a relative, home equity loan or reverse mortgage. The sale/leaseback can be used in combination with the once-in-a-lifetime $125,000 sale income exclusion, but the provisions of the leaseback must be carefully considered to prevent a recharacterization of the transaction as an IRC 1031 exchange or loan transaction. Tax consequences and repayment requirements should be considered for the other alternatives.

Planning, Sale-leaseback transactions, Sale and leaseback, Reverse annuity mortgages, Reverse mortgages, Home equity loans

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Planning for retirement: defined benefit plans and planner due diligence

Article Abstract:

Financial planners are responsible for informing clients of risks to their retirement funds such as bankruptcy of their employer with an underfunded plan as well as actual planning for retirement. Planners need to be aware of the clients' benefit plans' funding status, the stability of their employers and the likelihood the client will or will not receive the expected benefits. Benefit projections are traditionally based on annual salary increases, return rates on plan assets and years with the company. However, planners must warn clients of stability risks or they could be liable.

Analysis, Practice, Financial planners

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Getting the job done: employer strategies for the retirement of baby boomers

Article Abstract:

It is vitally important that employer-provided retirement benefits remain a part of the mix of income sources that Americans rely on when they retire, and government efforts to reform entitlement programs and tax laws should not interfere with employer incentives to provide these benefits. Laws should provide certainty in benefits planning and recognize the needs of employers and employees. Retirement savings assets can also fuel the economy by providing ready capital.

Retirement Benefits, United States, Laws, regulations and rules, Compensation and benefits, Employee benefits, Baby boom generation

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