Millions of Americans are preparing to retire over the next couple of years, and many are sitting on a gold mine. While scurrying around to pay off credit card debt and max-out their 401(k), they analyze their expenses looking for anything they can cut to retire sooner while often overlooking their largest asset.
LOWER EXPENSES
Research shows that 51% of retirees age 50 and older move into smaller homes, often to reduce maintenance, lower costs, or unlock equity. BINGO. Nearly anyone can do the first two – reduce maintenance and lower costs. Think about the expenses tied to your home: property taxes, homeowners insurance, utilities and repairs. All of these are tied to the size and age of your home. It goes without saying that if you downsize to a smaller home, all these expenses will drop, significantly impacting your monthly retirement income goal.
HOME WARRANTY
Also worth noting is the value of a home warranty. You can purchase a home warranty on your new smaller home as a resource to cover future repairs and maintenance costs.
UNLOCK EQUITY
The third reason this age group is downsizing is to unlock equity. Guys, this is genius! Many of you have a sizeable amount of home equity that would allow you to pay cash for a smaller home while netting tens of thousands if not hundreds of thousands of cash to reinvest. By using a guaranteed product at current rates, a 60-year-old female can generate around $7,500/year for every $100,000 invested. That’s $625/month toward your monthly retirement income goal. If you invest $200,000, you can generate $1,250/ month.
If you feel you haven’t saved enough for retirement, downsizing your home could bridge your retirement income gap allowing you to retire with confidence.
Prepare now. Listing in late spring is generally recommended with the highest sales occurring in the month of June. Here are five budget-friendly home trends that you can pursue to bolster interest and maybe even drive-up your final sale price.
MAXIMIZE VALUE
- Clean and declutter your home.
- A fresh coat of paint in neutral or earthy colors can go a long way.
- Use an air freshener with lavender or bergamot to promote relaxation.
- Have your windows professionally cleaned inside and out.
- Spruce up your yard with fresh mulch and seasonal flowers.
None of these items need to be high-end. You should be able to do all five for less than $1,200.