Retirement comes with some important decisions that impact both your life and finances. One of the biggest questions is where you’ll live during your golden years. Buying a house after age 55 is a major financial commitment and you can’t afford to make the decision lightly. Whether you’re looking to downsize in your local town or head someplace new, here are a few things you need to consider.
What to Look for in a Home After You Retire
Location is especially important when it comes to what to look for in a home after you retire. Depending on your situation, you may want to factor in proximity to family and friends, safety, climate and access to health care. Shipping out to a spot that’s warm and sunny may seem like a no-brainer if you’re tired of frigid winter weather, but it could come at a price if you’re leaving family behind. Personal reasons aside, you must also consider the financial implications of moving. One of the most important aspects involves how buying a retirement home can impact your tax situation. States like Connecticut and Rhode Island have extremely high property tax rates, which could make your dream home much more expensive.
Speaking expenses, your financial picture may change once you retire. Creating a post-retirement budget can give you an idea of what over 55 living looks like in terms of your income and expenses. If you’re planning to purchase a home in an active adult community, knowing how much you can realistically afford to spend can keep you from getting in over your head.
Buying a house after age 55 involves more than just the mortgage, taxes and insurance. You also have to factor in the expense of maintenance and upkeep. If you’re in relatively good health, you may be able to take care of these things on your own. But as you age, you may find yourself paying out more money for professional repair and maintenance services. Buying a relatively newer retirement home may help you to avoid having to deal with certain issues right away. You may also consider moving into a community where these services are included for residents.
Your retirement home should be is built for aging. A large home with lots of stairs may not be a good fit as you get older. If you buy a multilevel home, you may end up selling it again or having to do expensive upgrades when you need more age-friendly features. Consider a ranch-style home or a house that has a master bedroom and bathroom on the main floor.
The Bottom Line
Over 55 living is meant to be enjoyed, but not carefully considering what to look for in a home can put a damper on your plans. Do your research before you start browsing property listings and you’ll easily avoid any major financial roadblocks.