Retirement

Generate extra income by renting out part of your home

If you have extra space in your home (a room or an in-law suite), consider leveraging it as a money-making opportunity. The additional income can help you cover your mortgage payments, property taxes or other expenses. With the additional income flowing in, you might find yourself with the means to fund your retirement or explore new investment opportunities.

Or, if you have a serious case of wanderlust and you’re planning on traveling during your retirement, think about renting out your entire home while you’re away. Not only will this provide you with a steady source of income, but it also means you can enjoy your retirement adventures without worrying about your empty house.

Invest the profits from a downsize

Downsizing doesn’t have to be a daunting prospect. In fact, it can be a smart move to create a retirement pension fund. By selling your current home and moving to a smaller, more affordable property, you can unlock a significant amount of cash. And what do you do with that cash? Well, you can invest it in any number of ways to give yourself a steady stream of income during your golden years.

With a variety of property types available, the perfect fit for your portfolio will depend on your investment goals. That’s where we can help. Talk to us about the best kind of investment property for your specific situation.

Leverage your home equity to purchase a rental property

By leveraging the equity in your home to secure a loan or line of credit, you can become the proud owner of a rental property (a house or condo) that generates regular rental income. This can mean a steady stream of cash flow during retirement or as a supplement to your regular income. Plus, rental properties have the potential to appreciate in value over time, which can boost your overall wealth and leave a valuable asset for your family.

Planning your next steps

Planning for your retirement is a big but exciting task. You’ve worked hard for your home and built up your home equity. Now you can leverage your nest egg to generate some additional income for your retirement. Imagine the peace of mind you could have in your golden years.

Make sure you do your research and consult with the right professionals (financial planner, real estate professional, etc.) to help guide you through some savvy financial decisions that can ultimately help you contribute to your pension fund.

If you have questions about downsizing or rental properties, we are here to help. Give us a call today!

519-746-5136
sold@cindycody.ca

Transitioning into retirement is a big change in anyone’s life and it can cause you to re-evaluate your real estate goals. Both the decision to retire and what you choose to do with your current home are financial and lifestyle decisions – and important decisions that can impact how you choose to live your retired life.

Many people approaching retirement choose to sell their larger home and move into a more manageable property. For some people, downsizing means moving into a condo, which means less time spent on property maintenance. For others, it means moving into a smaller home and taking the opportunity to get rid of excess items in their home.

If you’re starting to plan your retirement and want advice on selling your home, strategic timing, or have questions about the real estate market, we are here to help. Contact us.

Here is some more information on the different homeownership options you may have for your retirement.

Retirement and Homeownership

Source: baseline.home-wizard.com

DOWNSIZING

Downsizing involves selling (or renting out) your current home and buying a smaller home.

There are many advantages to downsizing during retirement. A smaller home requires less maintenance, and can have lower taxes. It can also be better suited to reduced mobility that comes with aging, such as fewer stairs. Depending on how you finance the new home, downsizing can also reduce your monthly financial burden while on a fixed income.

Downsizing does require the management of the sale of your home (or transitioning of it to a rental property). If your home has appreciated significantly in value, there could be tax implications associated with a large capital gain with your home sale. Versus renting in retirement, downsizing still includes homeowner risks for unexpected major home repairs, which can be challenging when on a fixed income in retirement.

CASHOUT AND RENTING

This retirement strategy includes selling (or renting out) your current home and electing not to purchase a new home, but instead renting a place to live.

Depending on the financial situation of your current home (equity vs market value, remaining mortgage, etc.), selling your home and not re-investing in a new property can have a number of advantages. Freedom from home maintenance and not being responsible for property taxes are attractive aspects of renting. Plus, renting versus owning can make it easier to relocate in the future, as your lifestyle and needs continue to change during retirement.

On the other hand, becoming a renter brings the uncertainty of rent increases, which can be difficult when on a fixed income. Transitioning to renting also involves having to rely on a landlord for maintenance issues.

RELOCATING

For some, retirement brings the opportunity to move to a new location that is more consistent with your new lifestyle needs and desires.

Especially if your current location was chosen for the benefits of your children (school system, neighborhood, etc.), becoming an ’empty nester’ now affords you the opportunity to choose a location suited to your new priorities. This could be moving from the suburbs to be closer to the amenities of a more urban area, or relocating to the bliss of living in the countryside. A relocation can provide better weather conditions or access to important recreational settings. An important consideration for relocating can be improved proximity to family.
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