NEWS FOR OLDER AMERICANSPaying For
Medical Care |
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(NAPSI)-An important part of planning for long-term health care is deciding how to pay for services, and according to the U.S. Department of Health and Human Services, 70 percent of Americans over the age of 65 will need long-term care service at some point, with the majority paying for it out of pocket. The Employee Benefit Research Institute estimates that the typical older couple will need to save $300,000 just to pay for health care costs not covered by Medicare or private health insurance. With one-third of today's 65-year-olds expected to spend at least three months in a nursing home as they grow older, and 24 percent predicted to need nursing home care for at least a year or longer, older individuals are facing the possibility of limited income with increasing expenses. Add to this any unexpected expenses and retirement can be financially crippling for some seniors. "Social Security replaces only a small fraction of preretirement earnings," said Tim McDonald, head of Wells Fargo's Senior Products Group. "With retirees living longer and carrying an ever-increasing share of their health care costs and prescription drug payments, these are turning the golden years into a time of need and worry for seniors." McDonald called the Home Equity Conversion Mortgage (HECM) a good choice for older adults struggling to make ends meet with their health care expenses. He said it's an option that gives older homeowners access to equity in their house to pay medical bills and for long-term care services. "Using a reverse mortgage to gain financial independence and peace of mind is a growing choice for seniors who want to age in place in their own home for as long as possible. Getting a reverse mortgage can help a senior take care of his or her own needs and live more comfortably, including easing concerns of adult children who may be helping their parents pay health care bills." A reverse mortgage can be used by people 62 or older who have at least 50 percent or more equity in their house. The senior remains the homeowner for as long as he or she lives in the house and keeps the taxes and insurance payments current and the house in good repair. The loan balance becomes due when the senior leaves the home. The loan amount for a reverse mortgage is based on three factors: age of the youngest borrower, value of the home and the current interest rate. The senior can receive his or her loan proceeds as a lump sum, a fixed amount each month or a fixed amount set for a number of years. In addition, the senior can opt for a line of credit or a combination of lump sum, monthly payment or line of credit distributions. A consumer-friendly Web site and free online reverse mortgage calculator can help seniors and their trusted advisers learn more about reverse mortgages, download free educational materials and calculate an estimate of how much a reverse mortgage could provide them in retirement. You can find it at www.wellsfargo.com/reverse. Wells Fargo is the nation's leading retail originator of reverse mortgages. |
Older homeowners can get money out of their house to meet
medical bills or other expenses without having to move. Word Count: 545 |
