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Should I Sell My Home
And Rent An Apartment When I Retire?

One of the biggest decisions you will need to make is where you will live when you retire.

Many people work most of their adult lives on the premise that once they retire, they will live a lifestyle that is carefree and void of worry, stress, and strain. For some, retirement will be exactly what they always hoped it would be, but for many others, it may not end the way they thought.

The most pressing issues for retirees are income and living arrangements. Before retiring, you adjust your lifestyle around your take home pay. The longer you work on your job, the easier it is to figure out how to live within the parameters of your income.

Even though you k now that you are going to retire well before it happens, time slips past you and you find yourself not so well prepared for it and find yourself struggling to make ends meet. Your income may drop significantly when you retire, sometimes up to 50% or more of your regular employment pay. This is why it is imperative that you save and invest throughout your working years.

It is very important that you give a lot of thought to your living arrangements when you retire. The first step is to analyze home ownership versus renting. The question becomes, "can I afford to keep the home I am buying or do I sell it and find an affordable place to rent?" This is very important because it can have good or bad ramifications long after you retire.

The stress can be daunting when you have to decide between keeping the family home or renting, but it is a decision that you will have to make. If you decide to sell your home, where will you rent? Apartment living is great in some areas, but in others, it may not be that appealing. And what about the costs to rent? In some areas, rent is high and it may cost you about the same as the amount you are paying on your mortgage. In some cases, it may be even more.

If you keep a few things in mind about renting and home ownership, you can make informed decisions that will help you make the right choices.

  • If you have a home and it is paid off, it may not be that big of an issue for you to keep your home.
  • But if you have a mortgage, especially one that has a lot of years left on it and the payments are high, your retirement income, social security, and income from other investments may not be enough to cover your monthly costs.
  • On the other hand, your retirement income may be more than enough to pay your mortgage, taxes, homeowners insurance, and other bills without any problems.
  • Even if you do have enough income to cover your mortgage payments, you may not have enough money left over each month to keep you from insolvency if you lost one of your streams of income.
  • The up side to renting is that you don't have to worry about paying property tax, lawn and garden upkeep, maintenance, or homeowners insurance.
  • The down side to renting is that you lose the mortgage interest and property tax deductions that you would have on a primary residence. While your income may still be taxed, rental costs are not tax deductible.
  • Renting is not for everyone. The thought of living in an apartment makes some people nervous and uncomfortable, especially the thought of living in an apartment complex as they get older.

Retirement is supposed to be the time in your life when you can relax and enjoy the things you dreamed about when you were younger. If you plan carefully, you can reach your goals and the decisions you have to make about your living arrangements can be solved long before you retire.


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