We should all have a plan for the day (far away, or soon to come) that we ‘retire’ from our day job. For many, this means more time for travel, more time with family, and maybe some volunteer work. This requires years of planning, saving, investment and a bit of luck. It is nice to have the markets on an upward swing your last few working years, growing your nest egg and not shrinking it.
Something that needs to be part of your financial plan is your home. Will you be staying in it, or moving? For most, the home is one of the largest investments and the growing equity, as home values increase and the mortgage is paid down, is part of your financial standing.
For many, there will be a retirement home in their future. Something smaller, easier to maintain, and possibly closer to the children and grandchildren. Ideally, the sale and equity in your existing home will mostly, or fully, cover your future retirement home but depending on where you are selling and where you plan to buy that may not be the case.
While plans can change, having proactive thoughts on your housing needs during retirement allows you plenty of time to prepare. Whether you plan to stay in your existing home forever, or are planning a post retirement move, you will want to stay on top of your current homes needs. This allows you to maximize the resale value if you plan to sell. If you are staying, keeping up with current needs will prevent more costly repairs at a time you may be on a fixed income.
I met a couple recently who both retired recently, did some traveling, and were now settling into their retirement routine. Their home was built in the 1970’s and was a very nice home, but at almost 50 years old it had needs. It had original tile in two of three bathrooms, which they wanted to remodel. Their windows were quality units when installed but are no longer energy efficient by today’s standards. The roof would need replacing within a few years, and the exterior needed paint.
This was their chosen ‘forever’ home, and they had some large expenses ahead. Was this part of their retirement planning? I did not ask, but I am suggesting you bring your home into your retirement planning thought process. In hindsight, they could have addressed some of those projects while they were still working and had income to help cover expenses.
Take your home into account, as a source of retirement equity and the possibility of substantial expenses, as you plan for retirement. While Mr. Handyman and our sister Neighborly brands can help with many needs around your home, only you can plan for your future and decide which needs are appropriate now and which can wait until you are retired.