Bad News for Retirees: How Inflation May Impact Your Social Security Benefits
Over the past year, inflation has spiked 8.6%. The cost of consumer goods and services is increasing at its fastest pace in 40 years. Many investors are being advised to position their portfolios defensively for the time being.
But for those in or nearing retirement, the rising cost of living may be chipping away at your savings and buying power, making you financially vulnerable at a time when financial stability is most critical.
Are you feeling insecure about Social Security?
If you’re relying on Social Security as a key income source, it’s important to understand how inflation is affecting those benefits, too.
Today’s mounting costs have highlighted a huge challenge within the Social Security Administration — how Social Security Cost of Living Adjustments (COLAs) are calculated, leaving recipients underfunded. In short, the benefits are failing to keep up with life as we know it.
For 2022, Social Security recipients saw a 5.9% boost in their monthly benefits checks. But it can’t compete with the 8.6% rise in the cost of living we’ve seen over the past year.
What’s more, the tax threshold hasn’t adjusted with inflation. Since the Reagan administration, Social Security recipients have been taxed on their benefits when their income exceeds a certain threshold: $25,000 as individuals and $32,000 for couples. A growing number of retirees are being pushed over the edge — owing more to Uncle Sam while having less to afford their post-work lifestyle.
Now more than ever, it’s important to look for ways to reduce spending and preserve your savings For eligible older homeowners, there’s a financial tool that may also help by providing the funds you need to soften the impact of inflation — a reverse mortgage.
Understanding Social Security Benefits as Part of a Holistic Financial Plan
The luxury of home equity
If you’ve worked hard to pay off or pay down your mortgage, it may be an opportune time to reap the benefits, tapping into the wealth tied up in your home. For qualified applicants, a reverse mortgage allows you to leverage those funds while continuing to own your home with your name on the title. †The funds can be accessed as a lump sum, monthly payments or a line of credit that’s available if and when you need it.
One of the best features, reverse mortgages don’t require monthly payments. You can pay as little or as much as you want, when you want. You may even pay off the loan early with no prepayment fees. Borrowers are still responsible for keeping up with loan obligations, including property taxes, homeowners insurance and basic home maintenance.
To learn more, contact a local loan specialist at Reverse Mortgage Funding, LLC (RMF) at (888) 277-1567. We’ll give you the facts and resources to learn if a reverse mortgage loan is the right solution for you.
This content is sponsored by RMF, one of the nation’s leading reverse mortgage lenders. We are dedicated to helping older Americans retire more freely, in the comfort of their own homes. As a result of our commitment to providing an extraordinary and positive customer experience, we have earned a 98% customer satisfaction rating; a 4.5-star / Excellent score on Trustpilot; 4.8 out of 5 stars on LendingTree; and an A+ rating with the Better Business Bureau. Call 888-277-1567 to speak with a licensed reverse mortgage specialist to learn about our retirement financing products and solutions.
†Borrowers who elect a fixed rate loan will receive a single disbursement lump sum payment. Other payment options are available only for adjustable rate mortgages.