It’s never too early to think about retirement. Planning for the future as early as possible will give you the freedom to live your best life during your golden years.
Here are the benefits of purchasing your retirement home now instead of waiting until you retire:
It’s less stress for the future
Getting a mortgage is easier
You’ll have a head start on paying off the house
It’s a great way to diversify your assets
You have time and money for renovations
You can anticipate future monthly costs
You’ll get to know your future neighborhood better
One of the most difficult things to do after retirement is finding the perfect place to live. The process involves searching for the right community, viewing different houses, and figuring out the finances of the purchase which could be overwhelming for many.
Buying a retirement home now will give you less things to worry about when the time comes. It gives you the peace of mind that comes with being prepared for the future.
It’s easier to qualify for a loan when you’re still fully employed. Mortgage lenders prefer those with a low debt-to-income ratio, high credit score, and substantial savings which are all easier to have when you’re working.
Furthermore, waiting until retirement to buy a home could limit the mortgage amount you can qualify for. Most retirees don’t earn as much as they did when they were working full-time which means they can only qualify for smaller loans.
Being able to borrow less can severely narrow down your choices and make it harder for you to find a home that suits your retirement needs.
This is another great financial advantage. The earlier you buy the home, the sooner you can pay off the mortgage. You can have the opportunity to start your retirement life without any debt.
If you buy your retirement home early enough, by the time you actually use it, you’ll have paid for the majority of the mortgage or the home entirely. Paying the monthly amortization can be challenging if you are on a fixed budget.
If you’re still a couple of years away from retiring, you can use your retirement home as an investment property and add it to your portfolio. You can turn into a full-time rental property or make it a vacation rental until it’s time for you to use it.
Having a rental property will help you generate extra income which can help pay for the home’s mortgage. If your rental property makes enough money, it can even help you retire sooner.
The IRS also gives out tax advantages to rental property owners. You can enjoy exemptions to property tax, mortgage interest, and capital gains tax as long as you meet certain requirements.
For those not too keen on managing a rental property, using it as a secondary home for short holidays is also a great way to utilize the property.
Unless you’re building a home from scratch, you’re probably going to make some changes to your new property. Buying a home before retirement gives you ample time to renovate and remodel so it can meet your needs better.
The budget for your home renovation also won’t be an issue if you’re still working. If you’re using your retirement home as a rental property, you can gear that extra income towards future upgrades and renovations.
Figuring out an accurate budget is a challenge for many retirees. Once they move to a new home, they need to predict their monthly utility bills, property taxes, and other housing costs so they don’t go over budget.
If you buy your retirement home now, you’ll be able to better anticipate your housing costs and plan accordingly. You won’t have to worry about spending more than you can afford and just simply enjoy living in your new home.
One of the toughest things about moving for retirement is getting used to the new community. If you buy your retirement home in advance, you will have ample time to familiarize yourself with the neighborhood.
Whether you use it as a vacation home or a rental property, you’ll be able to get the feel of the neighborhood and experience what that community has to offer.
Ready to buy your retirement home today? The Wiley Team can help you find the perfect home for you. Get in touch with the best real estate agents in Greenwood, SC! Just give us a call at 864.993.8153 or send an email here.