THE BYRON SHIRE
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Buying a home in retirement by Miranda Marquit
as provide you with the ability to buy your new, During retirement, we often think about how to better stretch smaller house outright. our dollars. After all, the goal is to last longer than our money. One of the ways to make your nest go further is to downsize to a Use the money from the sale of your larger home to smaller home. buy a smaller home. The Downsizing to a smaller home during retirement often reduces difference in the prices your expenses, and it provides you with a way to get a little more is cash that you can use cash out of your previous home. It can be especially effective if you to help your retirement, have the mortgage on your larger home paid off. For many retirees, a smaller home makes sense. The kids have grown up and moved whether you want to go out. Additionally, a smaller home is easier to clean and maintain. on a trip, or whether you You don’t have to spend as much time and money on upkeep. Some want to change up your investment portfolio. A little of the lower costs that come with a smaller home include: extra capital can go a long t Smaller house, lower bills. Save money each month on heating/ way if used right. cooling your home, as well as electricity and water. Don’t be tempted to buy t Lower property taxes: When you live in a smaller home, you are likely to see a lower appraisal from the government, and your with another mortgage. The goal is to reduce your property taxes will probably be lower. obligations in retirement, t Fewer purchases: When you know you don’t have the room, you not add to them. are less likely to make so many purchases. After all, where will you keep all that stuff ? Downsizing your home can help you What if you want a bigger house? downsize your lifestyle altogether. Some retirees aren’t interested in downsizing: They want to ‘upRun your retirement calculations to determine if you need to free grade’ their lifestyle. Perhaps you want your home to be large up a few hundred dollars a month to live comfortably. Simply enough to accommodate children and grandchildren when they moving to a smaller house could be the solution you are looking visit. Before you buy a bigger home, though, make sure you run for, since it results in monthly savings that can ease your retire- the numbers. Can you afford to pay the monthly mortgage? ment cash flow. Selling your older home can help, since it will provide you with Hopefully, you will have paid off your mortgage by the time you a substantial downpayment and the ability to avoid a huge mortretire. Creating a retirement plan that ensures that your mortgage gage. You want to make sure that your monthly retirement budget is paid off can help you reduce your monthly obligations, as well can handle the added expenses of a larger home – especially costs
related to utilities, as well as maintenance and upkeep. Remember that it’s not just your mortgage payments you will have to worry about. Bottom line: Your home, with its mortgage paid off, provides you with options. You can downsize your lifestyle more easily with the proceeds from the sale of your home, or you can upgrade less expensively. Just make sure you carefully consider your options before proceeding. t .JSBOEB .BSRVJU JT B GSFFMBODF XSJUFS BOE QSPGFTTJPOBM blogger. She writes for numerous financial websites and can be found at plantingmoneyseeds.com. Article sourced from realestateproarticles.com.
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The Byron Shire Echo October 15, 2013 45