Welcome to the “2-Minute Money Manager,” a short video feature answering money questions submitted by readers and viewers.
Today’s question is about whether you should rent or own your home after you retire.
Watch the following video, and you’ll pick up some valuable info. Or, if you prefer, scroll down to read the full transcript and find out what I said.
You also can learn how to send in a question of your own below.
For more information, check out “7 Reasons You Should Rent a Home in Retirement” and “To Buy or Rent? How to Find the Answer to That Million-Dollar Question” You can also go to the search at the top of this page, put in the words “mortgage” or “credit union” and find plenty of information on just about everything relating to these topics.
Got a question of your own to ask? Scroll down past the transcript.
Don’t want to watch? Here’s what I said in the video
Hello, and welcome to your “2-Minute Money Manager.” I’m your host, Stacy Johnson, and this answer is brought to you by Money Talks News, serving up the best in personal finance news and advice since 1991.
Today’s question comes from Shaun:
“At 65, I’m not inclined to undertake a home purchase, even though I am able to pay cash and not incur a mortgage. I fall into a category that has escaped your attention, or is not worthy of a line or two in your newsletter — namely, the secure retiree with no appreciable obligations who continues to rent and is comfortable in doing so.”
First things first, Shaun: Please be careful when you say things like, “I fall into a category that has escaped your attention.” I’ve been doing this for 30 years and Money Talks News has thousands of articles on virtually every money-related topic. If you’ve thought it, we’ve explored it. We have indeed written articles about renting in retirement.
My opinion? I think it’s a great idea, at least for some folks.
While I’m generally a proponent of homeownership, it carries a lot of responsibilities, like insurance, property taxes and all kinds of ongoing maintenance.
If you don’t feel like dealing with all that in retirement, who can blame you?
Other advantages to renting in retirement:
- Cashing out your home equity: It often makes sense to sell your home so you can use the money to fund a happier retirement.
- Getting what you want: When you rent, you can pick a house, apartment or condo that suits your current needs.
- Trying things out: You can try living in a different neighborhood, town or even country by booking a stay in a vacation rental.
- Living closer to children and grandchildren: Want to live near your kids or grandkids? Go for it. If they’re scattered around the country, divide your time and change rentals when the mood strikes.
- Less hassle: One great thing about being a renter is that when something breaks, you don’t have to fix it yourself — or pay someone else to fix it.
- More freedom: When you own, you’re tied down. Selling a house is a major effort. When you rent, though, you’re free to move at almost any time.
There you go, Shaun. You’re not inclined to undertake a home purchase, and I’m not inclined to disagree. That being said, let’s acknowledge that we’re all different. If you’re happy owning, nothing wrong with that, either. What’s important is to think about what you want your life to look like, consider your options and make it happen. Because at the end of the day, what’s important isn’t renting, owning or even money. It’s living the life you want to live.
Hope that answers your question, Shaun. Got a question of your own? Do what Shaun did: Simply hit “reply” to any of your Money Talks News newsletter emails and fire away. Not getting our newsletter? Fix that right now by going to Money Talks News and subscribing. It’s free, takes five seconds and will absolutely, positively make you richer.
I’m Stacy Johnson. See you here next time!
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The questions I’m likeliest to answer are those that come from our members. You can learn how to become one here. Also, questions should be of interest to other readers. In other words, don’t ask for super-specific advice that applies only to you. And if I don’t get to your question, promise not to hate me. I do my best, but I get a lot more questions than I have time to answer.
I founded Money Talks News in 1991. I’m a CPA, and I’ve also earned licenses in stocks, commodities, options principal, mutual funds, life insurance, securities supervisor and real estate.
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