A recent Realtor.com article highlighted a reality many families, real estate professionals, and financial advisors are seeing firsthand: the amount Americans believe they need to retire comfortably keeps moving higher. According to the article, the new retirement “magic number” rose to $1.46 million in 2026, up from $1.26 million in 2025. At the same time, many Americans still feel financially unprepared for retirement.
For many homeowners, that creates a serious planning gap.
They may have substantial home equity, but not enough liquidity, income, or accessible cash flow to support the lifestyle they want in retirement. That is why reverse mortgage retirement planning deserves more attention from homeowners, Realtors, and financial advisors alike. As the Realtor.com piece explains, home equity can be a meaningful asset, but it cannot serve as a retirement plan unless it is accessed strategically.
The retirement challenge is bigger than most people expected
The Realtor.com article points to a growing mismatch between what people think they need and what many have actually saved. It cites an average retiree savings figure of $288,700, compared with the much higher perceived amount needed for a comfortable retirement. It also notes that 46% of Americans do not expect to be financially prepared for retirement, while 48% believe they could outlive their savings.
That matters because retirement is not just about net worth on paper. It is about monthly cash flow, income stability, inflation, health care costs, and having enough flexibility to handle surprises without derailing the plan. The article also notes that experts are increasingly focused on whether retirees can actually convert their assets into usable income over a retirement that may last 30 years or longer.
Why homeowners can still feel financially stressed
One of the most important takeaways from the article is the idea that some homeowners are house-rich but cash-poor. In other words, they may have significant equity tied up in their property, but little liquid cash available for everyday needs, medical bills, home repairs, or income gaps. Realtor.com quotes multiple experts making the same essential point: equity does not pay bills by itself.
This is where many people get stuck.
They know they have wealth in their home, but they have not built a strategy for how that equity can support retirement. As a result, they may delay decisions, drain savings first, carry unnecessary stress, or wait until a financial emergency forces them to react. The article specifically warns that waiting until there is a crisis often leaves homeowners with fewer and less favorable options.
Why reverse mortgage retirement planning matters
This is where reverse mortgage retirement planning can become part of a smarter conversation.
A reverse mortgage is not the right fit for everyone. But for the right homeowner, it can help transform idle home equity into a more usable financial resource. The Realtor.com article specifically mentions reverse mortgages alongside downsizing, HELOCs, and other strategies as tools that may help homeowners access equity more intentionally. It also notes that these options tend to work better when they are considered as part of a proactive plan instead of a last-minute rescue.
For 62+ homeowners especially, a reverse mortgage may help create more flexibility by:
- reducing or eliminating a required monthly mortgage payment
- preserving other retirement assets longer
- increasing monthly cash flow
- establishing a line of credit for future needs
- supporting a broader retirement income strategy
The key is not to look at home equity as a last resort. It should be evaluated the same way any serious asset is evaluated: as part of a coordinated retirement planning conversation.
What this means for homeowners
For homeowners, the message is simple: do not assume your home equity automatically solves your retirement plan.
Your home may be your largest asset, but the better question is whether that asset is working for you in a practical way. If most of your net worth is tied up in your home, it may be time to review whether your current strategy gives you enough liquidity, flexibility, and peace of mind for the years ahead. Realtor.com’s article repeatedly emphasizes that a strong retirement plan should balance home equity with other resources such as savings, Social Security, investments, and long-term income planning.
What this means for Realtors
For Realtors, this is a relationship and planning opportunity.
Many older homeowners are not just deciding whether to buy or sell. They are trying to answer bigger questions:
Can I afford to stay in my home?
Should I downsize?
Can I help a family member?
How do I free up cash flow without giving up control?
What options do I have if I want to buy a home that fits retirement better?
These are not just real estate questions. They are retirement lifestyle questions.
When Realtors understand how home equity strategies fit into retirement planning, they become more valuable to their clients. They can help identify when someone may benefit from selling, rightsizing, or exploring a reverse mortgage for purchase or another equity-based option as part of a larger strategy.
What this means for financial advisors
For financial advisors, the article reinforces an important truth: a client’s home should not be ignored in retirement income planning.
Too often, the primary residence is treated as separate from the planning conversation. But for many households, it is the single largest asset on the balance sheet. Realtor.com quotes experts who stress that retirement plans are strongest when they are built on balance, with liquidity, growth, income, and protection working together rather than relying on one asset alone.
That makes home equity worth evaluating more carefully.
Used thoughtfully, a reverse mortgage can sometimes help reduce pressure on investment withdrawals, delay tapping other assets, or create optionality during volatile markets. Again, it is not a universal solution. But it can be an important planning tool when coordinated properly.
The real issue is planning early, not reacting late
One of the strongest themes in the Realtor.com article is that timing matters. Homeowners have more flexibility when they evaluate options before savings are drained, before debt becomes a burden, and before health or housing decisions become urgent. The article quotes experts who say the cost of waiting is real.
That is why reverse mortgage retirement planning should not begin in a crisis.
It should begin with a thoughtful conversation about goals, cash flow, risk tolerance, housing needs, and legacy priorities.
Final thoughts
The new retirement “magic number” may grab headlines, but the real lesson is deeper: retirement success is not just about chasing a bigger pile of money. It is about using all available assets wisely.
For many 55+ homeowners, home equity may be one of the most overlooked pieces of the puzzle.
For Realtors and financial advisors, that creates an opportunity to bring more value by helping clients think more strategically about the role housing wealth can play in retirement.
And for homeowners, the question is not just, “How much do I have?”
It is, “How can I make what I have work better for the life I want?”
If you are a homeowner, Realtor, or advisor and want to explore how housing wealth may fit into a smarter retirement strategy, now is the time to start the conversation.
Additional Resources
Reverse Mortgage Line of Credit
Should I Pay Off My Mortgage in Retirement
Is Housing Wealth Right for Your Retirement Strategy?
Every retirement plan is unique, and using home equity isn’t the right solution for everyone. But for many homeowners age 55 and older, it can be an important tool for improving cash flow and increasing financial security.
Understanding how housing wealth fits into your overall retirement strategy can help you make more informed decisions about the future.
If you’d like to learn more about how a reverse mortgage may help strengthen your retirement income plan, we’re happy to walk you through the options.
Send us a note below to request more information.