When discussing retirement planning, people are usually familiar with Social Security, 401(k)s, and personal pensions, but they often overlook the fact that their home itself is an asset. This is also true in Jackson. A reverse mortgage is a product that allows homeowners aged 62 and older to borrow against the equity in their home, meaning they can access the value built up in their home without having to sell it. Instead of making monthly payments, they can receive funds as a lump sum, monthly payments, or a line of credit, and the loan is repaid when the home is sold, the owner passes away, or the home is no longer used as their primary residence.

Looking at the housing market in Jackson, prices have been moving quite rapidly recently. According to Redfin data, the median sale price in Jackson is projected to be $145,000 for the three months ending in May 2026, which is an increase of 11.9 percent from a year ago. If the terminology is unfamiliar, think of it this way: as home prices rise, the equity available to utilize also increases.

However, a crucial number to consider in Jackson is the property tax. The median effective property tax rate in Jackson is 2.35 percent, significantly higher than the national median of 1.02 percent. In simpler terms, this means that even for the same home value, property taxes in Jackson are higher than in other areas. Even if you obtain a reverse mortgage, you must continue to pay this property tax and homeowners insurance, and you need to pass a financial assessment to qualify for the loan.

It's also good to be aware of the costs involved. The HECM, which is insured by the Federal Housing Administration, has higher initial costs due to origination fees, mortgage insurance premiums, and closing costs compared to a standard mortgage. However, it is a non-recourse loan, meaning that if the home value falls below the loan balance later on, the heirs are not required to pay the difference thanks to FHA insurance.

The amount you can borrow is determined by three factors: age, interest rates, and home value. In simple terms, the older you are, the lower the interest rate, and the higher the home value, the more you can borrow. HECM is only available up to the limit set by HUD, and if there is an existing mortgage balance, it must be paid off first with the reverse mortgage funds.

A reverse mortgage is not the only option. A home equity line of credit has lower initial costs but requires monthly payments, while downsizing can provide a lump sum but comes with the burden of adjusting to a new neighborhood. When planning for retirement, it is advisable to consider these three options and choose the one that fits your health and family situation.

There are also ways to reduce the burden of property taxes. Mississippi has a Homestead Exemption program that offers partial property tax exemptions for homeowners aged 65 and older or those with disabilities. Eligibility and exemption limits can vary by county, so it is recommended to check directly with the Hinds County Tax Assessor's office.

• Check the current market value of your home and remaining equity
• Assess whether you can afford the annual property taxes and insurance premiums
• Receive mandatory counseling through a HUD-approved counseling agency

When recommending reverse mortgages during retirement planning consultations, these three points are always emphasized. The reason not to make a decision based solely on the advantages is that over time, the equity left in the home may decrease, reducing the assets passed on to children, and if property taxes or insurance premiums cannot be paid, there is a risk of default. As of 2024, the percentage of the population aged 65 and older in Mississippi is 18 percent, which is on par with the national average, indicating that households in Jackson will likely continue to consider retirement planning.

Before applying for an HECM, it is essential to consult with a HUD-approved counseling agency. There are actual scams related to reverse mortgages targeting the elderly, so it is advisable to seek thorough counseling and discuss with family before making a decision. This article is not investment or legal advice, and it is recommended to consult with professionals before entering into any contracts.