Downsizing in Retirement: Your Only Option?
It has finally happened: retirement is here. Your children have left home and you are more than ready to start this new chapter in your life. And since your home is a very important part of your portfolio and it is (almost) paid off, why not start thinking about this new chapter by considering what to do with it? The obvious answer might be selling it, but the next question would have to be: and then what?
Sell and buy the same square footage – Have you considered selling your house and buying an apartment that is just as large? Once you move, you can forget about lawn care, pool maintenance and worry about garbage pickups but you do not have to feel cramped nor do you have to get rid of most of your furniture, valuables, and keepsakes.
Sell and don’t buy – What about selling your home and opting for a rental instead? This option not only puts money in your pocket (which you may use for travel or any other projects) but, in the case of a move to a new location, allows you to test out the waters and familiarize yourself with the new community, before committing to a more permanent solution.
Sell and downsize –At this point, many couples seriously think about the amount of space they will need moving forward. It’s tempting to think about a smaller townhouse or condo. Still, before making the move consider the size of this new property and make sure that going for a smaller house will not make you feel cramped and unhappy.
Sell and move to a fantastic location – Go ahead and finally move to that great city, mountain, beach or town you have been dreaming about for decades. Since you no longer have to worry about school districts, commuting times or other geographic constraints, now is your moment to make your dream a reality. The new home may be more expensive due to the more desirable location, but with money in your pocket from the sale of your current home, you may find that your dream home is quite affordable
With plenty of equity, you probably have more cash to work with than many of the younger buyers out there. Think about the right balance of real estate and cash in your pocket that works best for you and your future and go ahead, jump into retirement with a smile on your face!