Should You Sell Your Home After Retirement?
Retirement. What comes to mind when you hear that word? Relaxation, beaches, more time with loved ones, new hobbies?
One thing that is promised in retirement is change. Maybe you’ll read more, go on hikes, or travel. You might even be asking yourself if keeping your home is the best decision.
I’m sure you’ve heard some people rave about renting; there’s less home maintenance, no shoveling or raking, and no lawn upkeep
but do you really want to leave your forever home?
The freedom of renting seems appealing – doesn’t it? But what about the home you’ve invested in and built memories in for years?
Let’s say you still have a while left on your mortgage. Financially speaking, it doesn’t make much sense to stay and continue paying the debt. Have you thought about selling and moving into a home you can afford? You’ll free up the difference of mortgage for anything you want—that Europe trip is just in reach!
Not owning also has its perks.
Renting reduces other expenses such as home maintenance and unexpected repairs. Remember, if you have empty rooms in your home you’re still paying to heat and cool them even if you only get the occasional stay from your children or grandchildren.
On the other hand, renting is a monthly payment that you will never see again. Unlike a mortgage, rent only covers living in the home for that month—you’ll never own it—though some rents include certain utilities.
If you’ve already paid off your mortgage or are close to, it might make financial sense to stay put. The maintenance and utilities could be cheaper than renting.
You should also consider the value of your home—is it appreciating or depreciating? A realtor can give you a better idea of the local housing market and the value of your home.
Sometimes, the non-financial reasons are the most important—maybe you value the memories you made in your home. After decades of living in the same place with children and grandchildren running around, wanting to stay in a familiar place is very common among retirees.
If you do decide to sell your home and pursue renting, it can seem confusing at first. First, you’ll need to find the right realtor to help you sell. Recommendations or a quick Google search will steer you in the right direction.
Then, make your home appealing for the most profit. Your home has been lived in for many, many years and probably needs some updates.
You can also look into a home stager to take the work off your hands.
After that, you’ll be faced with the choice: rent or buy? The decision should be based on the market, your lifestyle, and your financial status. Renting would be more beneficial for those who don’t have the time or means to care for a home. It can also be useful to those who are traveling often.
On the other hand, buying a downsized home would benefit those who enjoy staying put and are able to care for a home.
If you decide to keep your house, discuss renting it out. Do you plan on travelling often? You can rent periodically through companies such as Airbnb to profit while being away from home. You can even use the extra income to pay for any potential home repairs or maintenance!
Remember, there isn’t a one-size fits all retirement plan. You should carefully consider your home value, equity, lifestyle, and retirement needs before selling or deciding to stay put. Jumping into retirement can seem scary. But with the right help, it can be easy.
Here at RGA, financial planning is done right so you can keep more of your money.
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