Ask Terry Questions Real Estate — sell and retire?

Real Estate — sell and retire?

By Terry Savage on May 29, 2019 | Financial Planning / Retirement

Terry, I have appx. 13 years left on my mortgage and am considering retirement next year. I have more house than I need in a family-oriented and aging community. I would like to rent in a more vibrant and culturally rich area but it would be slightly more expensive than what I spend now. I have no heirs and modest retirement savings (currently a little over $100,000) and would get appx. $3500 monthly in social security and pension income, depending on when I retire. Would it be wise for me to sell the house, gaining more liquidity and having a retirement cushion (netting about $75,000), or should I play it safe and stay put? I want to do a bit of traveling and don’t want to be house rich but cash poor. I also do not want to risk a downturn in the housing market. My house would sell quickly now. I just turned 65 and am almost debt free, except for my mortgage.

You are wonderful and I learn so much from your columns and responses to questions. I check every day for your Savage Truth. Thank you!

Terry Says

Given all those things you’ve just said to me, I would sell the house and not look back.  It’s hard to part with memories, but you have made a good case that you’re ready to let go.  Then, think twice about where you want to live.  This might be a good time to move into a senior community — not an “old age” place, but one that offers all kinds of amenities.  If you move when you’re young enough to be active and make friends, it could be the start of a great new life.

But for the question of retirement, I would delay at least until your FULL RETIREMENT AGE for Social Security.  Every extra year you work adds to your financial flexibility. Take the proceeds from your house and put them safely in a money market deposit account in a bank.  Don’t spend that money!  Then, please write back in a year and we can discuss next steps.


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