You may be living in the home where you have lived for many years and raised a family, a home to which you have strong emotional ties. Consequently, you may decide to continue living there. But, you should start thinking about the future. Maintaining a home and garden when you are 65 may be quite different from when you are 75. On the other hand, you may want to sell your home and ‘downsize’ or relocate. Should you decide to sell your home there will generally be two options to consider: buy or rent.
When you sell your home you will be receiving what is probably a substantial amount of cash. If you purchase a smaller and less expensive home you will then be able to use the difference to help fund your retirement. In this way you are gaining access to some of the equity in your home. Another factor to be considered is estate planning. If you have children and want to leave an inheritance to them, you will need to consider the implications of selling your home and what it means to your childrens’ inheritances.
If you decide to sell your home and rent you will receive the home sale proceeds but will now have an ongoing expense which may eat into your savings. Selling and renting also has implications on the eventual estate to be left to your family.
To avoid misunderstandings and hard feelings, it is probably a good idea to bring your children into the discussion about your plans for the family home.