Search Properties By County

You’ve Decided to Downsize, But What About Your Family Home?

SHARE & COMMENT:
Palm Beach Gardens Real Estate

If you’re a senior who is thinking about downsizing, you’ve spent years building up to this point: You’ve built your nest egg for retirement, you’ve built equity in your home, and you’ve built years’ worth of memories. Now that you’re ready to make a move, one of the biggest questions is how to protect what you’ve worked so hard building, especially when it comes to your home. Owning a home is a major asset, and this gives you options. The hard part is weighing the pros and cons to determine which one option is best.

Renting Out Your Home

Many seniors assume they should sell before moving, whether you plan on buying something smaller, renting, or moving to a retirement community. In some situations, selling is the best option, but you may also want to consider keeping it and renting it out to generate additional income. According to The Motley Fool, one in ten seniors relies at least partially on rental income to maintain their lifestyle in retirement.

The main benefit of this option is that you continue building equity in your home while having money coming in at the same time. This can be ideal for seniors who move to assisted living because the rental income helps offset these costs. If you are planning on moving to assisted living, keep this potential income in mind when you start looking for the right community. The cost of assisted living varies based on all kinds of factors, such as the style of home, amenities, and other services that are included. In Stuart, the average cost of assisted living can be anywhere from $1,500 to $8,495 per month.

Along with cost, the other thing to keep in mind is what you or your senior loved one needs from an assisted living community. The purpose of assisted living is to provide help with everyday tasks, like coordinating medications, meal preparation and other basic needs, while allowing you to live with a good deal of independence. Instead of a “facility” type of environment, you’re more likely to have an apartment that has all the comforts of home. These are the basic features you can expect from assisted living, but specific details vary from one center to the next. This is why you should shop around and visit a few centers to find the one that feels right to you.

Selling Your Home

You also have the option to sell your home when you decide to downsize, which leaves you with a lump sum that you can put towards whatever lies ahead. You can use that money to buy a less expensive house or condo, or you can rent a smaller place. According to Kiplinger, many seniors find that selling their home gives them peace of mind that their housing costs are predictable, plus you don’t have to worry about maintenance, insurance, and all the other costs that come with owning a home. When you free up the money in your home, you also have the option to invest it in other ways.

Keeping Your Home

If you don’t need the income from renting or selling your home, another option is to simply hold onto it. One case in which waiting to sell makes sense is when your home isn’t worth enough to justify letting it go, especially if you have an emotional attachment to it. Holding onto your home allows you to keep it in the family, which can be a valuable asset to pass on to the next generation. Next Avenue explains how, in some situations, keeping your home may even allow you to pass it along to your kids at a tax advantage.

With everything you’ve put into your home over the years, finding the best way forward is a decision you don’t want to make lightly. Whatever you decide has to make sense for your current situation – as well as your future. The best thing to do is talk it over with family, take your time, and remember that this decision is as emotional as it is financial.

Photo credit: Pixabay