As the U.S. economy has improved in recent years, the Financial marketplace has become more sophisticated, offering Americans a variety of products to support them during retirement. Although reverse mortgages have lately gained considerable attention for being a new and improved retirement planning tool, most Americans say they have no need for them, at least according to one recent survey.

By 2060, more than 1 in 5 adults living in the U.S. will be age 65 or older. As the population continues to grow at its rapid pace, emerging technologies will continue to evolve the diverse marketplace for financial services over the next decades. In the years ahead, the convergence of both these demographic and technological trends will raise serious questions about the financial experiences of older adults, according to a recent study published by the University of Southern California in collaboration with the Society of Actuaries.

A previous study conducted by the Federal Reserve Board’s Division of Consumer and Community Affairs in 2012 examined these trends in efforts to better understand how Americans age 40 and older manage their finances, including how they make their financial decisions and what are their main sources of financial stress.

But times have changed since the Federal Reserve conducted that study, especially as the U.S. economy steadily recovered from the Great Recession. To investigate the transformation of Americans’ financial lives since then, USC embarked on the Financial Management Survey not only to update the earlier study, but to also allow a comparison of the financial management of individuals and households of all ages.

The survey covered a variety of financial products and Americans’ experiences and sentiments toward them, including traditional mortgages, checking accounts, credit card balances, student loan debt and also reverse mortgages.

As with the 2012 survey, USC found almost no use of reverse mortgages and little intention to use these products. Among homeowners age 62 and older participating in the survey, fewer than 1% had a reverse mortgage, compared to 2% in the 2012 survey.

Those who answered they “considered getting a reverse mortgage but decided not to,” or they had “never considered getting a reverse mortgage,” were asked why they did not follow through with the loan.

More than half (60%) said they had “no need for a reverse mortgage,” whereas 12% did not understand the product well enough; 13% did not want to build up debt; 14% wanted to preserve home equity as an emergency fund; and 31% wanted to preserve home equity to leave to heirs.

For 24 survey respondents who do not currently have a reverse mortgage, but had one in the past or considered getting one, researchers asked, “how did you decide to get or consider getting a reverse mortgage?”

A majority of 61% said they saw or heard advertising about the product, while 34% indicated they wanted to get a reverse mortgage after researching the product for themselves.

Among other respondents, 21% said the suggestion by a friend or family member influenced their decision to pursue a reverse mortgage, whereas just 4% did so following the suggestion by a financial adviser. Another 5% indicated that reverse mortgages were suggested by someone trying to sell them the product.

While the sample size used in the USC survey represents only a sliver of the older adult population in the U.S., and is not indicative of real reverse mortgage demand, the findings in the Financial Management Survey raise concerns about the overall ability of Americans to achieve financial security in old age.

Despite the improving economy, more than half of those responding report experiencing “major financial stress” within the last three years, with debt playing a significant role.

Whether credit card related, student loans or mortgages, debt potentially undermines the financial security of many Americans, USC researchers noted. And for older adults, mortgage debt is particularly significant since home equity represents their largest component of net worth.

View the USC survey.

Written by Jason Oliva