For most people, retirement is a major goal in life. Everybody has their own individual plans for how they want their retirement to pan out, but there are still certain details about what the best way to go about retirement is that people continuously weigh in their head. When people enter the retirement age, their kids have usually moved out, and they don’t quite need as much space. As a result, many retirees opt to downsize their living situation. When this time comes, is it better to buy or rent a new home? Here are some things to consider on the subject…
Consider estate planning
First of all, one major question that you need to answer is whether or not you want something that you are going to pass down when you pass on. For this reason, you should definitely have focused on planning out your estate by retirement age and have created a comprehensive will. If you feel like a home isn’t going to be an important part of your will that you want to focus on, then renting won’t have much of an impact on this. However, if you are expecting to pass on a home in your will, then it will obviously have an impact on your decision.
Depends on market conditions
One major factor of whether you should buy or rent depends on current conditions of the housing market in your geographical area (or the one you plan to move to when you retire). If housing prices are high, then it might not be in your best interest to purchase a home that could easily lower in value, since you probably aren’t going to want to spend a lot of time renovating in your old age. When deciding to rent or buy a home in retirement, always check to see if now is a good time to buy, and whether you really are going to get the most bang for your buck.
Buying is more work
Owning a home is a lot of work. There is a lot of upkeep that you will either need to take care of yourself, or pay to have it done. For some people, this may be a relaxing way to spend their retirement. However, if you would like your savings and capital to go towards other things, then renting can be an easier way to cut back on costs.