Does your retirement plan include more than just a 401(k)?
Here’s how to make sure your home is ready for what’s next.
Retirement is supposed to be the start of something exciting!
More freedom, greater flexibility, and lots of time to enjoy the things you’ve worked so hard for all your life. But that next chapter can also come with financial anxiety, especially nowadays when just about everything seems to cost more.
That’s why retirement planning shouldn’t stop with your investment accounts.
Your home is one of your biggest financial assets—and also one of your biggest potential expenses. Before transitioning out of the workforce, we encourage you to take a fresh look at whether your home is helping you achieve the retirement you envision.
“Retirement is a great time to reassess your overall financial picture,” says Everest Senior Loan Officer Faye Berkowitz. “The home you own should absolutely be part of that conversation.”
And there’s no reason to stress!
The good news is, you don’t have to make every decision at once. A little preparation can help you better understand what your home will cost and how well it fits your future lifestyle. A trusted loan officer can also help you explore your options and determine whether a change to your current mortgage or home strategy makes sense.
Before you turn the page to your next chapter, consider these five housing-related moves, courtesy of Everest Equity.
Your Pre-Retirement Home Checklist: 5 Moves to Make Now
1. Review Your Mortgage
First, look at your mortgage balance, interest rate, and monthly payment. If you expect your income to change significantly once you retire, consider whether your current housing payment will still feel comfortable.
For some homeowners, that could mean exploring refinancing options. For others, it may simply mean understanding exactly how much they’ll still owe (and for how long) before making other retirement decisions.
Faye Berkowitz explains, “The goal isn’t necessarily to eliminate your mortgage. It’s to make sure you understand how it fits into your retirement budget.”
2. Look for Ways to Lower Your Monthly Housing Costs
Your mortgage isn’t the only expense that comes with owning a home. Property taxes, homeowner’s insurance, utilities, and ongoing maintenance can add up quickly.
As you approach retirement, tally your total monthly cost of homeownership (not just your mortgage payment). Are there expenses you can reduce? Are you paying for more space than you need? Could a different home or location better align with your future lifestyle?
“We often think about affordability in terms of the mortgage payment,” Faye Berkowitz notes. “But homeowners should look at the entire cost of carrying a property into their golden years.”
3. Tackle the Big Repairs Now
✓ New roof
✓ HVAC replacement
✓ Sewer line repairs
✓ Foundation work
✓ Updated siding
These aren’t exactly the expenses most people want to think about during retirement. But the truth is, they’re much easier to plan for before retirement than when you’re living on a fixed or reduced income.
While you’re still young and thriving in your career, make a list of the major systems and components of your home. Identify what may need attention in the next five to ten years, and start prioritizing them in order.
Think of it as preparing your house for the future before the future arrives.
4. Get Serious About Taxes & Insurance
Property taxes and homeowners’s insurance can change over time, and both deserve a place in your retirement planning conversation.
“As you approach retirement, it’s time to inquire about the Senior STAR exemption, which may help reduce your property tax burden if you qualify,” says Faye Berkowitz. “Every dollar you can potentially save on your ongoing housing costs can make a difference.”
Review your current costs and consider how they could affect your budget several years down the road. And if you’re thinking about moving, don’t assume a lower purchase price automatically means lower housing costs, as taxes, insurance, and maintenance can vary dramatically from one property to another.
5. Ask the Question: Will This Home Fit My Future Life?
This may be the most important consideration of all.
The home that was perfect for raising a family may not necessarily be the home that’s ideal for retirement. Think about stairs, yard maintenance, proximity to family and healthcare, travel plans, community amenities, and how much space you realistically expect to need and use.
Maybe the answer is yes, stay put. Or maybe it’s downsizing, moving closer to family, or purchasing a home that better suits your lifestyle.
“There’s no one-size-fits-all answer when it comes to the right home for retirement. The important thing is to make the decision intentionally, rather than waiting until circumstances force you to,” says Faye Berkowitz.
The Home Takeaway
Planning for retirement isn’t just about how much money you have in the bank. It’s also about determining how much it will cost to live the life you want.
Your home plays a major role in that equation. By reviewing your mortgage, ongoing expenses, repairs, and long-term lifestyle needs before retirement, you can enter this next chapter with one less thing to worry about.
Everest says:
Retirement starts at home
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Everest Equity
From your first home to your next chapter,
we help you make the most of every move.