Financial Planners and Reverse Mortgage Consultants Can Learn From Horse Trainers

I had coffee a few weeks ago with a financial planner who told me off the cuff that many financial planners feel that they are in competition with reverse mortgage consultants. I asked him why and he said, “ Because as financial planners we feel the annuities are better for the seniors and reverse specialists want the seniors to have the reverse mortgages instead.” I looked at the financial planner and said, “what if we just got the senior what he or she really needed instead of what we were actually selling?”

 

I told him the story of the best horse trainer in Wyoming, who happens to be my brother, Jack. I asked Jack years ago what made him a successful horse trainer. He said he had a very simple mantra that he lives by and it seems to work in everything he tries to do: He said, “Life is about balance and respect and doing the right thing.”

 

He said, when he trains a horse, the horse needs to respect him and he needs to respect the horse – he has to know when to spur the horse on and when to pull back the reins and bit, and when to trot him and when to gallop him. He said there is a fine balance and intuitiveness involved in training a horse. Along with balance, he said it’s important for him to know everything about the horse to make him the best.

 

My point with this story is that we professionals (mortgage people, financial planners, CPAs, elder care attorneys and estate attorneys) who strategize the seniors portfolio and estate, need to know the client and his whole picture. We need to know when an annuity or reverse is better for him, if life insurance versus mortgage insurance or term is best or a combination; and if a life estate, trust or living will suffices. In addition, if the housing market is better for his money or the liquid assets, or combination of all. And most important, we need to identify what part of his portfolio is out of balance.

 

If I visit a senior and he has an extensive financial portfolio with liquid assets but his house payment is killing him, I know he is out of balance. Financial planners need to understand that if a senior is heavy laden in mortgage payments, and an unforeseen tragedy happens, the senior will be forced to drain certain liquid assets. If a spouse dies or becomes seriously ill, the mortgage payment becomes a heavier burden. It would seem to protect the assets of the seniors, it would be better to have no house payment in the seniors’ golden years and protect their liquid assets at the same time.

 

Many financial professionals and attorneys that I see, still think the reverse is like it was in the 60s, 70s, and early 80s: that the bank has title, the bank can take the house away, and the heirs are left with a mess. I have to explain to them that since 1988 when National Council of Aging, AARP, Congress , FHA and President Reagan changed all that by putting new guidelines in place for seniors. It is amazing how many professionals do not know this or understand the reverse mortgage and yet, will advise them against it. This seems odd to me, especially when the senior relays to me that he is wondering if he should pay his utility bills that month or the mortgage. It is important and essential that financial planners, estate attorneys, insurance agents, and mortgage specialists understand the basics of what each professional does and respects the power of a well balanced and thoughtful portfolio. Otherwise, we are leading horses with blinders on.

Mary Andes

Wells Fargo Reverse Mortgage Specialist

Reverse Mortgages in Maryland

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Wells Fargo Home Mortgage Address: 5300 Westview Dr., #302, Frederick, MD, 21703

Phone: (757) 291-1430