Many people decide to downsize when they retire, but others dream a little bigger.
If you have your sights set on a larger property, you may plan on:
Pursuing a homesteading dream.
Building a hobby farm.
Or hosting your kids and grandkids for frequent visits.
But buying acreage after retirement requires careful planning and consideration.
Besides ensuring that you can afford this big purchase, you'll also have to consider the work involved in navigating a significant move.
Here are some essential things to think about as you start hunting for your dream retirement home!
Paying for Your Property
Before you start looking for properties, find out exactly how much home you can afford.
You don’t want to spend time touring sprawling properties and luxury homes just to find out that they’re out of your budget!
The first step in calculating your home affordability is adding up all of your retirement income.
If you’re still working, Modern Retirement recommends hiring a financial advisor to help you estimate what your income will look like post-retirement.
Your income may come from several different sources, including:
And employment benefits.
So don’t leave anything out of your calculations!
If you’re planning on selling your home to fund your new property purchase, find out how much money you can expect to get from your sale.
Several online tools can help you calculate how much your home is worth. If you’re not keen on the idea of fixing up, staging, listing, and marketing your home, consider selling directly to Contenza Properties!
Getting a Mortgage After Retirement
Unless you can pay cash for your new home, you will need to get a mortgage.
Despite common belief, it’s not impossible to get a mortgage after you retire.
Moneylenders use unique methods to determine mortgage eligibility for retirees who don’t have a paycheck. Here are some of the best mortgage lenders of 2020 that may be able to help you out.
Besides ensuring that you can afford to take on a large loan in retirement, be sure to plan for the unexpected.
For example, if you were to pass away before you pay off your mortgage, your loved ones may be left to cover the rest.
You can protect your family from this burden with a good life insurance policy.
When it comes to life insurance, you have several options, so do your research to find the best solution for your budget and coverage needs.
Budgeting for Extra Expenses
With a larger home comes more significant expenses. Plan to pay more for regular costs like:
And home maintenance.
So ensure that you have room in your retirement budget for these higher costs.
You also have to consider the costs of selling your home, buying a new one, and moving somewhere new.
For example, real estate agents typically charge a commission of about 5 to 6 percent of the home sale price!
On top of this, you should be prepared to pay a few thousand dollars if you're planning on moving interstate.
Navigating a Move
Everyone knows that moving is a lot of work.
Depending on how far you’re moving and how much stuff you have, you may have to dedicate months to:
And transporting all of your belongings to your new property.
This can be incredibly draining, so make sure you’re ready for it!
Being prepared with a detailed moving checklist will ensure you don’t miss any critical steps along the way, like transferring your utilities or making travel arrangements for a long-distance move.
If you have the budget for it, leave the heavy lifting to professional movers so you can avoid injuries on moving day.
Just remember to research and book movers well in advance so you can get your top choice!
Whether you want to:
Grow a sprawling garden.
Build a hobby workshop.
Or host family reunions.
Buying a bigger property might help you meet your retirement goals.
And with the right planning, this can be a very realistic venture. Start getting your finances in order and preparing for your big move now, and you’ll be settling into your new home soon enough.