If you’re like many American retirees, you may be worried about your financial security post-retirement. However, there is a solution that could ease these worries—a Reverse Home Mortgage. A reverse home mortgage can allow you to extract your mortgage equity to help reallocate some money where you need it.

Benefits of a Reverse Mortgage

A reverse mortgage can be a complicated process, and many wonder if it could affect your government benefits like Social Security, Medicaid, and pension benefits. This blog will explore some of the advantages and drawbacks of a reverse mortgage and how they can affect your government benefits.

Social Security

The short answer is no. A reverse mortgage will not affect your Social Security benefits. The main distinction that could determine if your benefits will be affected by a reverse mortgage is whether or not the program is “means-tested” or not. Social Security is a non-means-tested program that does not impact your monthly income because technically you have been paying your Social Security throughout your whole life, and since you already earned this money it is not classified as part of your monthly income. Your Social Security will be safe if you decide to embark on a Reverse Mortgage.


When it comes to Medicaid it is a whole different story. In short, your Medicaid could possibly be affected by a Reverse Mortgage because it is a means-tested program that affects your monthly income based on your current financial assets, but it does come with some stipulations that differ for each situation. For example, if you are receiving your Reverse Mortgage through a line of credit, then generally your Medicaid will not be affected because it is not counted as a liquid asset.

However, Medicaid requires that recipients have no more than $2,000 in liquid assets for any given day, but this is not a requirement for a Reverse Mortgage. But let’s say, for example, you receive a $4,000 lump sum from your Reverse Mortgage and spend all of it on home repairs during the same month, then you are in the clear. However, if you do not spend all of this money in the same month and the total sum of your liquid assets exceeds $2,000 then you will not qualify for Medicaid.

Pension Benefits

The effect that a Reverse Mortgage will have on your pension benefits is similar to that of Social Security wherein it will not be affected. The specifics may differ depending on your circumstances, and what type of Reverse Mortgage you have.

Your pension benefits have been accumulating over time, and they are established with your employee to give them even more protection. You have been working for these pension benefits for most of your life, which means they are not technically part of your monthly income and will not affect your Reverse Mortgage.

Reverse Mortgage Solutions

So in review, the only program mentioned here that could be affected by a Reverse Mortgage is Medicaid. If you have any questions or concerns we urge you to contact a Certified Reverse Mortgage Professional.

Retirement is a time for relaxing and unwinding, and we are here to help give you that peace of mind. Here at Geneva Financial, Chris Handy is your go-to specialist in reverse mortgages. We always strive to create an unbeatable experience for each and every one of our clients.

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