My wife and I will both be 65 when we plan to retire in June, 2014. My job of 43 years included housing provided as part of the compensation package, so we have no home or equity. We have not debts but $50K saved for retirement. I plan to work to supplement our social security pension and work pension ($2,700 total).
We plan to relocate to be closer to family (aging mother, daughter) and see there are many affordable homes for sale. It seems that house payments would be less than rent. Andy advice?
Terry Says: Well, you have to look at all sides of that issue. First, you’d have to put down a down payment — and that could use up a lot of your liquid capital. Second, you won’t be able to get a mortgage when you retire — because you won’t have any income! (hint: if you really want to buy, do it now!) And third, you give up a lot of flexibility when you own instead of rent. If one of you needs to go to assisted living, for example, the other might be stuck trying to sell that home in a bad market. And there are always additional capital expenses that come up when you have a home! All things to keep in mind as you make this decision —