78 Million Baby Boomers Will Strain Social Security

9/27/2007

posted by N. Sioris

Stumble It!

A recent report issued by the Treasury Department said that Social Security is facing a $13.6 Trillion dollar shortfall. The shortfall is the gap between what Social Security is expected to pay out in benefits and what it will raise in payroll taxes.

Delaying reforms to the Social Security entitlement program would be unfair to future generations. The Treasury Department said that a combination of benefit cuts and tax increases will need to be considered to permanently fix the funding shortfall. With the looming retirement of 78 million baby boomers - born between 1946 and 1964, the pressure is on for Congress to take some serious steps that likely will not be well received by many Americans.

With the uncertainty of Social Security more retirees than ever, will have to take the majority of the responsibility for funding their own income during their golden years. One way to do that is through the use of a Reverse Mortgage. That however, assumes that you have a large amount of equity built up in your home. If you have used your home as an ATM machine or refinanced your home and pulled out equity during this last housing boom, you may be out of luck on qualifying for a Reverse Mortgage.

But, if you do have considerable equity in your home, you may want to find out if you qualify for a Reverse Mortgage. All persons on the title must be at least 62 years old. If you qualify, you can tap into your home equity in a number of ways: A lump sum amount of money given to you, a line of credit to be used as needed, a fixed monthly amount given to you as income, or a combination of these.

No repayment is required on a Reverse Mortgage until you permanently leave the home. At that time the Reverse Mortgage must be repaid through either the sale of the home or a refinance mortgage to pay off the Reverse Mortgage.