Like much of the Baby Boomer generation, my wife and I are now empty nesters and faced with deciding how we want to live the next chapter of our lives. Pam and I have spent the last 33 years in our Naperville home where we raised our children. Up until a month ago, it had been Pam’s plan to keep our family home as long as we could so our children and grandchildren would have a “home” to come to. Now she is talking about other options including the carefree lifestyle of a condo. Personally, I have been ready for condo/townhome with no stairs and no exterior maintenance for some time.
You, too, probably will be evaluating your housing needs in the foreseeable future. Should you stay where you are or consider one of the many alternatives? Of course, you would like to make a choice that would fulfill both your lifestyle and financial needs. Below are some factors you may want to consider.
PRESENT HOME MAINTENANCE
Will the age and/or condition of your present home bring unacceptable cost in the future? Will repairs or replacement of components become overly burdensome? How about the physical energy necessary to keep your property looking sharp and in good working order? Are you able to do the work yourself or can you afford to have someone else do it for you?
RETIREMENT INCOME NEEDS
Can you continue to own your property with its current mortgage payment obligations and still meet your future retirement needs? If the house is free of debt, it may be best to stay put. However, a large debt load may require you to sell this property and buy something that will carry a much lower financial burden. This may be particularly true for those who have helped finance one or more college educations.
How affordable are your alternatives? Compared to the value of your present home, would a condo or smaller home within an acceptable area be within reach? Where would your money best be invested? These questions can only be answered by looking at the monthly cost of owning each property versus the expected annual inflation in the value of cash.
Last, but not least, how do you see yourself living the next stage of life? Perhaps you want to travel and enjoy a turn-key lifestyle that a condo/townhome would afford. Perhaps you have traveled for a living and the thought of getting on a plane is not what you have in mind. Perhaps you just want to chill and watch the world go by from a quiet screened porch. Or is an age 55 and above active adult community with tons of people and activities just what the doctor ordered?
ADVICE: First, you will need to truly understand where your heart is leading you and then you will need good and reliable information upon which to evaluate your future real estate needs. The best source of this data is your local Realtor®. He or she can show you all your alternatives so you can determine how to live happily ever after…