Retirement is something every worker dreams about at one time or another. Research from the Retirement Industry Trust Association (RITA) shows 10,000 Baby Boomers reach the typical retirement age of 65 every day- with the entire generation slated for retirement by the year 2030. On top of that, some younger Americans are taking the opportunity to even retire early, through clever financial planning and investments. Regardless of your age, retirement is a dream come true for most hard workers who will finally get to reap the benefits of all their labor over the years.
If you’re planning on retiring soon, or have already retired, you’ve probably already begun considering your options as you move into this new stage of life. Your daily needs are going to be different: no more having to think about a morning commute, for starters! That’s just one area where you need to ask yourself: will my current home suit my needs going forward? Some retirees have plans of spending all their time vacationing around the world, so you may not even want to continue owning a home.
While owning a home offers great freedom and financial security while you’re living there, it can also offer the same benefits as you move into retirement. According to the National Association of Realtors (NAR), “Homeownership is the largest source of wealth among families, with the median value of the primary residence worth about ten times the median value of financial assets held by families”. If you own a home, you’ve likely built up significant equity, which can be used to help fund your next move in life.
Over the past several years, at the national level, homeowners who purchased a single family home could expect to have gained more than $225k in equity if the home had sold at median sale price. Home prices have continued to rise, meaning even more equity. CoreLogic analysis shows U.S. homeowners with mortgages… have seen their equity increase by a total of $1 trillion since the fourth quarter of 2021, a gain of 7.3% year over year.
What does this mean for you?
As your needs change entering retirement, chances are you might consider making a move to a different home. Whether you want a smaller home that takes less time and financial resources to maintain, want to move closer to loved ones, or just want to live in your dream destination- your home equity will help you get there. It may be some (if not all) of what you’d need for a down payment on your new slice of retirement paradise!
The Bottom Line
Retirement is a big change in your life, as you leave the work force and find yourself free to do what YOU want to do! No more bosses, alarm clocks, or late nights stuck at the office. Retirement is all about making decisions that benefit you and can give you a great time during your golden years. As you move into this new chapter of your life, let’s connect so you can have an expert to help guide you through the process of selling your current home and finding somewhere to meet your new wants and needs. Retirement is supposed to be fun, so let the professionals give you some guidance- and get ready to live your best life. Together, we can put your home equity to work for you.
