Many people buy large houses to raise their families in. When the children are all grown up and out on their own, the parents find themselves in a house that is more than they need... more to clean, more to maintain, more to repair, and more to heat and air condition.
At some point, the costs of living in a large house outweigh the benefits of being a homeowner. Here are 3 housing options for when it's time to downsize from your empty nest.
Buy a Smaller House
One option, of course, is to buy a smaller house. Depending on how long you've lived in your large house and how much equity you have built up in it, you might be able to pay for a small house with cash. However, you'll still be the one responsible for upkeep and repairs when something goes wrong.
Before investing in a smaller house, it's a good idea to speak with a financial planner regarding tax implications of buying real estate property without a mortgage and if investing that money elsewhere would be a better option for your retirement portfolio.
Rent an Apartment
Another option is to rent an apartment. They are smaller, which means there is not as much housecleaning to do. If anything breaks, simply call the property manager or landlord to make the repairs. And no more property taxes, which can be a huge blessing if you are on a limited budget like many others in their retirement.
However, most apartments are located in large buildings or complexes that may not have elevators. Your parking space in the parking lot may be an uncomfortable distance from your front door, especially if you get ill or injured.
Move Into a Retirement Community
Renting or buying a senior living apartment or bungalow in a retirement community is similar to renting an apartment but with additional benefits. In addition to having property management on call to make emergency repairs, most utilities are included in the rental cost.
That means one payment would cover everything, which can be especially helpful if you have memory loss. That way, you won't have to worry about missing any payments and having your utilities shut off.
Another difference is that retirement communities have nurses and aides on staff to assist the residents when they need assistance, such as with taking medication, preparing meals, and folding laundry. Medical professionals are also available in case there is a medical emergency.