Sticker Shock over the Current Year’s Assessed Home Value?

Sticker Shock over the Current Year’s Assessed Home Value?

by | Aug 16, 2022 | Advisors, Alan Hensley, Property & Casualty Insurance, Real Estate, Tech Focus, Wealth Enhancement

 

Every year, homeowners receive notice from the county about their home’s assessed value. When we get that little card in the mail, it’s usually filed away and we don’t pay much attention to it. Lately though, many people are experiencing sticker shock when they see how much their home has increased in value from 2021 to 2022.

On one hand, it’s great to see how much our home, typically one of our most valuable assets, has appreciated. But on the other hand, that new higher assessed value means higher property taxes, and it could also mean we’re underinsured when it comes to replacement cost coverage. From a financial planning standpoint, I encourage everyone to think of that assessed value notice as an annual reminder to do two things:

  • Reach out to your insurance professional
  • Consider contesting the value with the county

 

Reach out to your insurance professional

Why is it a good idea to meet with your insurance agent/broker? Well, for starters, I always encourage my clients to meet with their insurance professional at least once a year to review their current coverages and policies. This is especially important if your coverage needs have changed. I recently spoke with Satina Simeona with American Family Insurance, and she shared some additional insights about why an annual review is so important:

Homeowners policies typically have a built-in inflation protection that adjusts the replacement cost coverage on your home to align with the market index in your area. However, it is an index and not necessarily specific to each uniquely different home. It is important to have an annual review with your agent regarding the replacement cost coverage on your home policy, specifically the ‘dwelling coverage.’ At the start of your home policy every insurance company uses a similar calculator tool that calculates the cost to rebuild your home should there be a complete loss. This is the amount you want to insure your home for, not the loan value or market value as those include the land, taxes, fees, etc. This is not done again unless your agent or you request it. The calculator process takes about 20 minutes and consists of very detailed questions about your home. For example, how many beds and baths, flooring material, countertop material, any vaulted ceilings, type of roof, ceiling fans, and any upgrades. For the exterior you’ll need to discuss decks, driveways, fences, retaining walls, etc. Once calculated, your agent can see if it is over or under your current coverage and make adjustments if necessary. Ideally it will come in pretty close to your current coverage.

Another reason you should have annual checkups is for your agent to ask about certain things that may need to be updated on your policy. For example, have you done any upgrades or repairs, new roof, added any large amounts of personal property that may need coverage (guns, computers, jewelry), do you want earthquake coverage or maybe coverage for the backup of your sewer or septic tank? These are all optional endorsements that are not included in your policy unless you add them. There are over 50 endorsements you can add to a homeowners policy, and it is important to be educated on your options in case the unthinkable happens. For example, you may consider an endorsement for hidden water because most policies won’t cover a long-lasting leak that has been undetected and perhaps caused extended damage. This hidden water endorsement will cover rot, black mold, etc.

Each insurance company will approach the annual review process differently, and it’s a good idea to ask your agent/broker how your specific policies work.  For example, some higher-end insurance providers might offer replacement cost coverage with an “unlimited” ceiling so you don’t have to worry about dramatic increases in your home’s value.

 

Consider contesting the value with the county

This second recommendation is more of a longshot, but don’t forget this is an option! If you believe you can provide evidence that the county is overestimating the value of your home, you should definitely contest the assessed amount.

I recently had a conversation with a client (let’s call her Jane) who owns a lakefront property. Jane received her property value notice in the mail, and it was a lot more than she expected. Jane was surprised because her home was older, modest, and it didn’t have a lot of modern updates. Surrounding Jane’s property were more modern, larger houses that easily justified a much higher price tag but hers simply didn’t. When Jane contested her home’s value with the county, she came to realize that the assessment done on her property mistakenly used the value of the neighboring homes. Jane was able to successfully reduce her property tax bill by $500!

 

These reminders are a simple way to make sure you stay on top of protecting your home and ensure you’re not paying too much in taxes. Financial planning is always an on-going process, and I hope these tips provide helpful food for thought. If you’d like to discuss these ideas in more detail, don’t hesitate to reach out to your Wealth Advisor. If you’re not already working with an advisor, don’t hesitate to reach out.

 

 

Disclosure: All opinions expressed in this article are for general informational purposes and constitute the judgment of the author(s) as of the date of the report. These opinions are subject to change without notice and are not intended to provide specific advice or recommendations for any individual or on any specific security. The material has been gathered from sources believed to be reliable, however Merriman cannot guarantee the accuracy or completeness of such information, and certain information presented here may have been condensed or summarized from its original source.  Merriman does not provide tax, legal or accounting advice, and nothing contained in these materials should be taken as such.

Home Repairs: DIY vs Hired Work

Home Repairs: DIY vs Hired Work

by | Jun 14, 2022 | Real Estate, Risk & Reward, Wealth Enhancement

 

It’s a tricky decision: hire someone to make home repairs for you or do it yourself.  Some are inclined to tackle their home improvement projects themselves to save money. It can even be satisfying to use your own hands to do a job. However, some home renovation projects are better handled by professional contractors.

Whether you plan on making significant structural changes to your house or just looking to make some upgrades, it would be a wise idea to determine which projects work best as DIY and which ones you need a professional for.

Read on to learn the benefits of DIY home improvement versus hiring a professional for the job. Moreover, you will learn how to decide between the two approaches for specific tasks.

Hopefully, it will give you better insights for your next project.

How to Decide Which Improvement Route to Take?

Deciding whether to take up a home renovation project yourself or seek the help of professional general contractors can be a confusing process. Let’s look at it in two parts.

First, let’s explore when it makes sense to tackle a DIY project to save money and when it is best to hire a professional to do the job. Then we’ll go over the pros and cons of each option.

 

 

When to Take the DIY Approach

You may pursue the DIY approach whenever any of the following conditions are true:

The project is not complicated and is easy to learn.

DIY jobs are not meant for complex projects that require specialized knowledge and fine-tuning. You should leave all of that to a professional. However, if the project is not complicated and you are willing to take the time to learn the basics of the job, you can take the DIY approach for that particular task.

You are not looking for perfection.

There’s a big chance that your remodeling project might not be as good as you anticipated it to be if you do it yourself. Are you okay with that? If yes, you can treat the project as a DIY job and enjoy saving money.

You like working on simple home improvement projects.

If you really enjoy DIY projects, then that will make your decision easy. Do you treat it as more of a hobby than a job? If yes, you should try the DIY route for specific home projects.

 

 

When to Hire Professional Help

Consider hiring a professional whenever one or more of the following conditions are true:

The project requires a building permit.

Numerous jurisdictions require a permit to facilitate electrical work or other structural changes. The ideal process would be to contact your city planner and find out your area’s licensing requirements. Such jobs often require special skills, so hiring a licensed contractor to perform them may be required.

A mistake could have serious consequences.

Some home improvements require a combination of a careful balancing act and expert supervision to ensure that nothing goes wrong. Even if you can find ways to burglar-proof your home, mistakes can keep your house vulnerable and weak.

Therefore, it is best to hire a professional, who often provides insurance for their job, if something goes wrong.

You plan on selling the house.

If you have a clear vision of selling your house in the future, you should seek professional help for most of your home repair work. Why? Because amateur DIY work can often turn off potential buyers and even reduce the value of your home.

If you are interested in learning the craft, you can work as a general contractor under a professional for larger projects like bathroom remodeling or plumbing.

 

 

Pros and Cons of Hired Work

Suppose you have decided to hire a pro after analyzing all the factors. In that case, you must check the professional license of your contractor and then think about the following pros and cons.

Pros

  • High-quality results
  • Keeps you out of any physical danger
  • Keeps the house value intact
  • Ideal for major work

Cons

  • Costs more money
  • Binds you to a strict project schedule

 

 

Pros and Cons of DIY

If you have considered all the essential factors and have decided to go for a DIY approach, keep in mind these pros and cons:

Pros

  • Ideal for smaller jobs
  • Saves money
  • Helps you learn a new skill

Cons

  • Compromised work quality as compared to reputable contractors
  • Can cause physical injuries
  • Not possible for building projects that require permits

 

 

Final Words

Your home is your safe haven. It is necessary to weigh all the pros and cons of both approaches when determining whether to go for a DIY job or hire a professional for your home renovations.

On the one hand, a DIY job is ideal for small projects and can help you potentially save a significant amount of money and raise your skill level.

On the other hand, a licensed professional should always handle complex home repair jobs related to cabinet hardware, hardwood floors, plumbing, and electrical work. It might cost you more money, but it guarantees quality results.

Moreover, it keeps you and your family safe from any physical injuries and keeps the value of your house intact. So, take note of the above approaches before you start on your home improvement projects.

 

 

 

Written exclusively for Merriman.com by: Ben. 

Ben is a Web Operations Executive at InfoTracer who takes a wide view from the whole system. He authors guides on entire security posture, both physical and cyber.

 

 

 

Disclosure: All opinions expressed in this article are for general informational purposes and constitute the judgment of the author(s) as of the date of the report. Statements attributed to an individual represent the opinions of that individual as of the date published and do not necessarily reflect the opinions of Merriman. The material has been gathered from sources believed to be reliable, however Merriman cannot guarantee the accuracy or completeness of such information, and certain information presented here may have been condensed or summarized from its original source.  Merriman does not provide tax, legal or accounting advice, and nothing contained in these materials should be taken as such.

Moving On Up – Ways You Can Prepare for Your Next/Forever Home

Moving On Up – Ways You Can Prepare for Your Next/Forever Home

by | May 31, 2022 | Advisors, Aimee Butler, Real Estate, Tech Focus, Wealth Enhancement

 

High on the list of stress-inducing situations is the process of buying a home. And while folks tend to think of the first home as being the hardest, I believe it is the next or your “forever” home that causes the most consternation.

The process of buying a home has a lot of moving pieces to contend with for the buyer; and when you add in the sale of your existing property along with the need to be financially stable enough to balance both homes (hopefully not for long), it can make the move feel untenable. Here are a few things that I wish I had known back when I was making that move:

  • Cash is KING right now. Having excess savings set aside will help the process—but it is not the only way to finance your move.

    •  

  • You may be able to use your current home’s equity to finance your down payment. Depending on the situation, doing this can give you a leg up on the competition, particularly in this hot real estate market. To accomplish this, you may be able to use a home equity line of credit (HELOC) or a second mortgage. In some cases, a bridge loan may also be a wise decision.

    •  

  • Your investment portfolio may offer some temporary cash for that next down payment. If you have assets in a taxable investment account and don’t want to sell them, you may be able to use a margin loan or a securities-based line of credit. Like a HELOC, you can borrow against the value of something—in this case, your stock portfolio.

    •  

  • You may be able to negotiate a lease back of your current property if the next place is not available.

    •  

  • With home prices on the rise, rolling equity into your next home could help keep your payments reasonable.

    •  

  • Speaking of payments, interest rates are also on the rise. Working with an experienced mortgage broker can help you get set up for success. Start that process early and look for opportunities to lock in lower rates while we have them.

    •  

  • Practice your new payments. Setting aside the additional amount you expect to pay after your move can accomplish two things: Add to your savings and get you used to higher expenses.

    •  

  • Get creative! There are many ways to make that second purchase successful. An experienced team can help you find ways to get your offer accepted.

    •  

  • Have patience. Buying a home can be stressful, especially when you already have a property. Patience and a sense of humor can go a long way toward making it a rewarding experience!

 
We love helping our clients navigate changes, like moving up. If you have questions about how to do this successfully, let us know.

 

 

Disclosure: All opinions expressed in this article are for general informational purposes and constitute the judgment of the author(s) as of the date of the report. These opinions are subject to change without notice and are not intended to provide specific advice or recommendations for any individual or on any specific security. The material has been gathered from sources believed to be reliable, however Merriman cannot guarantee the accuracy or completeness of such information, and certain information presented here may have been condensed or summarized from its original source.  Merriman does not provide tax, legal or accounting advice, and nothing contained in these materials should be taken as such.

A Guide to Average Home Maintenance Costs

A Guide to Average Home Maintenance Costs

by | Mar 29, 2022 | Emergency Savings, Real Estate, Tech Focus, Wealth Protection

 

Purchasing a new home involves a great deal of money, especially if you remain in the same house for years. To keep your home systems and appliances functioning smoothly, you also need to spend money on maintenance. This blog will help you understand the average home maintenance costs and how you can reduce them significantly.

 

What Is the Average Home Maintenance Cost?

According to a survey by the National Association of Home Builders in 2019, the typical cost of minor repairs and regular maintenance is $950 per year. This amount is based on the average single-family house and is subject to change based on several factors. For instance, the cost does not include expensive repairs and maintenance of items like the roof, swimming pool, HVAC, and other significant home features. Additional factors that can swing the cost of maintenance include the location of your house, the area of your house (in square feet), and the size of your family.

 

How Much Should You Budget for Home Maintenance?

A general rule of thumb states that you should keep 1% of your house value as a fund for general maintenance. For instance, if your house costs $500,000, then you should be prepared to pay up to $5,000 for maintenance. However, recent trends indicate that a growing number of homeowners are keeping aside up to 4% of their house value in their maintenance fund.

Another method, the square footage rule, states that you should keep $1 per square foot of your house for maintenance. Thus, for a 3000-square-foot property, you can expect $3,000 for maintenance. However, this method does not factor in the age, location, or the condition of your house.

 

What Are the Activities Included in Maintenance Costs

At times, people get confused between repair costs and maintenance costs. Maintenance of your house includes activities to keep your house clean and maintained. It also includes activities that allow seamless functioning of your appliances and home systems. Wondering what these are? Here’s a list of few of them:

 

  1. Cleaning the home deck or patio
  2. Lawn services
  3. Sidewalk and driveway maintenance
  4. Cleaning the gutters and vents
  5. Servicing your HVAC
  6. Maintaining faucets and sinks
  7. Maintaining the central heating system
  8. Lubricating garage door springs
  9. Pest control and inspection
  10. Regular maintenance of kitchen appliances

 

These maintenance activities are not very costly and can be managed using maintenance savings. However, the house itself might need repairs. Repair costs for fixing roofs, HVAC, structural defects, water heater, and the like can quickly add up. The excess of your maintenance funds can be used for these emergency fixes.

You can also assess the repair costs and set aside some money for such unexpected expenses. Alternatively, you could purchase a home warranty plan that covers these repairs and replacements of home systems and appliances. Check out the best home warranty companies offering reliable services. Your home deserves the best!

 

 

Conclusion

When you buy a house, don’t just consider the down payment, taxes, and renovation costs. Also include the annual maintenance costs. These are recurring charges you need to pay along with your house. There is no definitive range or rule that can exactly anticipate how much you might have to spend, so do what you can to be as prepared as possible.

 

 

Written exclusively for Merriman.com by Sophie Williams.
Sophie Williams is a professional content marketer. She leverages analytical skills from a STEM degree to give an edge to her passion for writing. She is always thinking about how to produce engaging content for her readers. She enjoys finding ways to minimize her living costs and help other struggling homeowners with the same. She also loves writing long rants on books and movies.

 

Disclosure: The material is presented solely for information purposes and has been gathered from sources believed to be reliable, however Merriman cannot guarantee the accuracy or completeness of such information, and certain information presented here may have been condensed or summarized from its original source. All opinions expressed in this article constitute the judgment of the author(s) as of the date of this article and are subject to change with notice. Merriman does not provide tax, legal or accounting advice, and nothing contained in these materials should be relied upon as such.

Is Now the Right Time to Buy a Home?

Is Now the Right Time to Buy a Home?

by | Mar 22, 2022 | Advisors, Goal Planning, Real Estate, Sierra Butler, Tech Focus, Wealth Protection

 

Since the beginning of the COVID-19 pandemic in 2020, it seems that Americans have been clamoring over one another to achieve a core component of the American dream: homeownership. And this phenomenon isn’t surprising; people have spent more time at home than ever before, and the obstacles to buying have dropped significantly. I’ve been asked more and more by my clients whether now is the right time for them to buy.

Unfortunately, the answer to this question is not a cut-and-dry yes or no. Homeownership is a commitment that shouldn’t be taken lightly, and there are multiple items to consider before making a decision.

 

Interest Rates

When I speak with potential homebuyers, one of the top reasons they feel an urgency to buy now is due to historically low interest rates. And they are not wrong. As shown in the below chart, 30-year fixed mortgage interest rates in the past year have been at their lowest ever since Freddie Mac began tracking them in 1971.

Source: https://www.macrotrends.net/2604/30-year-fixed-mortgage-rate-chart

 

While some may think that saving 1% on their mortgage rate isn’t a big deal, the truth is that it adds up quickly. Let’s say a homebuyer is comparing two 30-year fixed mortgages for a $500,000 loan amount, one with an interest rate of 3.0% and the other with an interest rate of 4.0%. At first glance, the monthly payments may not look too different: $2,108 per month for the 3.0% loan and $2,387 per month for the 4.0% loan. However, over the course of 30 years, this difference adds up. Over the life of the loan, the 3.0% rate will cost $258,887 in interest paid. Alternatively, the 4.0% rate loan will cost $359,348 in interest. That’s a difference of over $100,000 in interest paid over 30 years!

I certainly understand the concern as it relates to interest rates: How long will the rates stay this low? Since most lenders will not allow you to lock in your rate prior to your offer being accepted on a home, homebuyers are feeling the pressure to buy as quickly as possible. On March 16th, 2022, the Federal Reserve announced its first rate increase since 2018 of 0.25%, with additional interest rates increases on the horizon. While some may take this as a sign to buy a home as soon as possible, it’s important to keep in mind that the Federal Reserve is not required to raise interest rates, and there is still a possibility that they could change course.

 

Down Payment

For many homebuyers, the question of how much cash they should put toward their down payment is often top of the list. Historically, most buyers have targeted a down payment of 20% of the purchase price. Why? you may ask. Lenders have discouraged homebuyers from putting down less than 20% as it reduces the lender’s risk in case the homebuyer stops paying their mortgage.

To encourage buyers to put down at least 20% of the purchase price, most lenders charge Private Mortgage Insurance (PMI) to those who do not meet the threshold. The average range for PMI can cost between 0.58% to 1.86% of the original loan amount per year, depending on the homebuyer’s down payment, loan amount, and credit score.2 To put this in dollar terms, if a homebuyer had a $500,000 mortgage and was subject to a 1.00% PMI rate, it would cost them an additional $417 per month.

Though PMI is clearly a cost to be mindful of, recent years have shown more buyers opting to put less than 20% down. From 2017 to 2020, 33.6% of 30-year mortgages carried PMI. This is a sizable increase compared to the share of PMI mortgages from 2011 to 2016 at 25.5%.2

It is also important to keep in mind that a homeowner is not obligated to pay PMI for the life of their mortgage. Once their equity in the home is over 20%, the homeowner can work with their lender to have the PMI cost removed. Equity ownership in a home is not just linked to the amount paid, though. If a homebuyer purchased a home for $500,000 and the home appreciated in value to $550,000, they will have an additional 9% in equity compared to where they started.

Why should someone take out a mortgage with PMI? One of the top reasons is to maintain enough cash in emergency savings. Once the home purchase closes, the buyer is responsible for all maintenance costs—emergency or otherwise. If one must choose between paying PMI and having a sufficient emergency fund, I will almost always recommend prioritizing the emergency fund. Having enough cash on hand to support unexpected costs serves as the foundation (pun intended) for all prudent financial plans.

 

Competition

From speaking with your friends or listening to the news, you may think that everyone has bought a house in the past two years. Your intuition isn’t completely off-base; data from the US Census shows that homebuying peaked at the end of 2020 and beginning of 2021.

Source: https://www.census.gov/construction/nrs/index.html > Current Press Release (Full Report and Tables)

The increase in homebuying in recent history has unsurprisingly led to increased competition and sales prices. According to Redfin, in July 2021, the average home sold for over 102% of the list price.3 This was the height of sale-price-to-list-price ratios since the beginning of 2020. More recently, January 2022 has started off with the average house selling for 100.3% of the list price.

While this is a promising sign that competition has slowed down from its height, the housing market is still quite competitive. This often leaves homebuyers feeling the pressure to make a quick decision and offer over the asking price.

 

Conclusion

In addition to the factors mentioned thus far, there are other considerations to keep in mind when purchasing a home. Do you intend to live in the house for at least five years? Do you have enough cash outside of your emergency fund to pay for routine and unexpected maintenance? Are you ready for the responsibility that comes with owning a home? If not, maybe renting a house is a better option for you.

At the end of the day, choosing to buy a home is a significant financial decision that impacts many facets of your life. If you are left wondering where a home fits into your financial plan, our advisors at Merriman is happy to help you assess your options. Additionally, if you are a first-time homebuyer, please check out our Guide to the Homebuying Process.

 

Sources:
1 https://www.wsj.com/articles/fed-minutes-reflect-growing-unease-over-high-inflation-11641409628
2 https://www.urban.org/sites/default/files/publication/104503/mortgage-insurance-data-at-a-glance-2021.pdf
3https://www.redfin.com/news/housing-market-update-inventory-falls-below-500000/

Disclosure: The material is presented solely for information purposes and has been gathered from sources believed to be reliable; however, Merriman cannot guarantee the accuracy or completeness of such information, and certain information presented here may have been condensed or summarized from its original source. Merriman does not provide tax, legal, or accounting advice, and nothing contained in these materials should be relied upon as such.

Retirement Living: Renting vs. Homeownership

Retirement Living: Renting vs. Homeownership

by | Jun 29, 2021 | After you retire, Real Estate, Wealth Preservation

Photo by Skiathos Greece on Unsplash

 

Every retiree’s needs are different, which means that every person who retires will have to make their own decisions about whether they want to own a house or rent one.

Some seniors have already paid off their homes and wish to keep living there; others are prepared to invest in a property where they can enjoy their golden years; still others would prefer to live in a place where they don’t have to control the long-term maintenance of the property.

When it comes to retirement living, what makes more sense: renting or homeownership? There are pros and cons to both sides of this story. Let’s take a closer look.

 

Homeownership: Home Equity Has Value

When thinking about homeownership, it’s essential to consider the various ways that home equity has value for you.

Home equity could turn into extra income as you enter retirement, or it could simply act as enough of an investment to float you through your future years. Using home equity as part of your retirement beyond just living in the house, however, requires that you are comfortable making changes to your income strategy.

Selling your home, renting out your home, or taking a reverse mortgage are all ways that some seniors choose to use their home equity to their advantage in retirement. Just as there are both pros and cons to homeownership in retirement, there are also pros and cons to making these changes to your home.

 

Homeownership: When Keeping a House Makes Sense

Many retirees would be comfortable staying in their house in retirement, but they aren’t sure if that would make sense for them.

If you have a low mortgage, or your mortgage is completely paid off, and you have taxes you can handle, staying in your house is an option.

This may not be possible for those who bought their house more recently. Consider how much the house will continue to cost each month when you have less income in future years; this could help you determine if staying in your house will work for you. Selling may be the best option if you don’t have enough saved for retirement.

It is also vital that you consider how it will be to live in your house in your older years. If you live in a storied house, things like stairs or inaccessible bathrooms could prove to be a big issue to deal with. It’s okay to want to keep your home, but you will also need to be realistic about changes that may be required as you age.

 

Renting: A Reduction in Responsibility

One of the reasons that many seniors choose to rent is that they can reduce their number of house-related responsibilities as they age. Keeping up with all the needs of a house can be difficult for people of any age, and it can get even more tiring when you are older.

From mowing the lawn to shoveling snow, certain upkeep tasks are nice to hand off to someone else by renting. Additionally, you are no longer responsible for property taxes or similar large financial responsibilities beyond rent and utilities. This can make sense for many people’s retirement plans.

 

Renting: Flexibility and Accessibility

Another benefit of renting for seniors is that you have more flexibility in choosing where you live and how you live.

The rental property managers at Buttonwood explain that apartment units, condo units, and one-story rentals are often great choices for those who want to have a more accessible living environment. They go on to say, “When renting, it is also possible to change where you are living without significant cost. Unlike buying and selling houses, you can simply end a lease, start a new one, and move to your new location. This gives flexibility that a lot of seniors like to have in retirement.”

Moving as you please in order to be closer to family or friends is a big benefit of renting over buying for many people in retirement.

 

Homeownership vs. Renting: The Advantages

Choosing between homeownership and renting is going to be a difficult decision no matter what. However, you can start to narrow down your choice by thinking about what you need most in a home. What types of advantages are going to be most beneficial for your lifestyle? Consider those needs and then compare them to this list of advantages for each living situation:

Homeownership Advantages

  • Staying Situated
    Many people like to continue to live in a home that they feel has long-term stability and doesn’t rely on another person (i.e., a landlord) to be involved. This provides both physical and emotional stability for many.
  • Tax and Financial Benefits
    There are several tax perks for owning a home that do not apply to renters. Additionally, homeowners who have paid off their homes may find it significantly more affordable to live in said home. Plus, equity is something that you can keep growing or pass down your line.
  • A Home of Your Own
    A lot of retirees have worked their entire lives to be able to call their home theirs, and they want to keep living there. This allows you to personalize as you please without needing to follow any landlord rules for alterations.

Renting Advantages

  • Flexible Living Situation
    You can move as your needs or desires change, and you can do so without dealing with the stress of selling and buying homes.
  • Accessible Options
    Find homes that will allow you to avoid home maintenance or live without climbing stairs; these things become important in later life.
  • Balance Expenses
    Renting is often less expensive from month to month since property taxes, mortgage payments, house maintenance costs, and HOA fees may be eliminated.
  • Free Up Finances
    Selling a house and moving to rent instead gives you more money that you can use to invest or enjoy your golden years.

 

Whether you are delaying retirement to increase your savings before you stop working or you’re ready to move into this stage of your life, consider the pros and cons of homeownership versus renting before you take the next steps. You’ll be better situated if you ensure that you know what you are getting into in advance.

 

 

Written Exclusively for Merriman.com by Madison Smith

Madison Smith is a personal and home finance expert at BestCompany.com. She works to help others make positive financial stride in their lives by providing expert insight on anything from credit card debt to home-buying tips.

 

Disclosure: All opinions expressed in this article are for general informational purposes and constitute the judgment of the author(s) as of the date of the report. These opinions are subject to change without notice and are not intended to provide specific advice or recommendations for any individual. The material is presented solely for information purposes and has been gathered from sources believed to be reliable, however Merriman cannot guarantee the accuracy or completeness of such information, and certain information presented here may have been condensed or summarized from its original source. Merriman does not provide tax, legal or accounting advice, and nothing contained in these materials should be relied upon as such.