When retirement time comes, rethinking the American dream of home ownership could be in order. Sometimes renting a house or apartment is the better bet both financially and in terms of the retiree’s changing lifestyle and health.
As you get older, you need to think about such issues as whether you can keep mowing the lawn or handling other day-to-day chores that homeownership requires. If you must hire someone to do them for you, how much will that eat into what may already be a tight monthly budget?
Some things retirees should think about as they ponder the own versus rent question include:
When you own a home, every leaky faucet, electrical problem or faulty appliance is yours to handle as best you can. If you can do it yourself, great; but often, these household repairs mean calling in a professional at a sometimes exorbitant cost. When you rent, it’s up to the landlord or the property management company to take care of the repairs.
Selling a house can be a long and complicated process, and you never know what the market might be like when the time arrives. Whereas breaking a lease is much simpler. If your children are scattered all over the country, you may want to move closer to one of them. Also, if your health takes a turn for the worse, selling a home can be a significant burden on your family.
For many people, a house is the most valuable asset in their estate and they might want to leave it to their children in the will. Once again, it’s a matter of weighing the pros and cons. Having a home to pass down to the children is a noble gesture, but it is not always feasible. Before considering whether owning or renting is the right option,” Kearney says, “it’s essential to review all the intricacies of your situation and decide based on your finances and your overall health and well-being.
Eric Kearney (www.erickearneyadvisor.com) is an investment advisor for Retirement Wealth. He has been helping clients reach and maintain their financial goals for more than 16 years. Kearney coauthored a book with Forbes Media Chairman and Editor-in-Chief Steve Forbes, Successonomics. His professional licenses include a Series 65, Series 7 Securities License and a Life and Health Insurance License. He teaches successful pre- and post-retirees wealth management courses.