Reaching retirement is a major milestone. Alongside being able enjoy more time for yourself, you might also feel the benefits of reduced financial pressure, especially if you’ve already paid off your mortgage.
While you might prefer to focus on ways to have a fulfilling, happy retirement, it’s still important to consider where your property comes into the mix. In this guide, we’ll explore your potential options when it comes down to managing your estate as a homeowner in retirement.
Should I downsize?
Some people choose to downsize, and for good reason. With experts advising couples to save more than ever before for a comfortable retirement on the back of the rising cost of living, profits from selling a larger property could make a great choice.
If downsizing feels right for you, don’t put it off.
Of course, the obvious drawback for some could be living in a smaller space. This could prove challenging if you’re lucky enough to have a busy family life and growing grandchildren, but if it’s just the two of you, it might feel cosy and comfortable.
Renting out: the pros and cons
If you let your own property out and move into a more affordable rental yourself, you could make a surprising profit. If you rent your house to tenants on a six- or twelve-month contract, you’ll enjoy peace of mind that you can return again after making some extra money.
Those savings could prove invaluable should you later need or decide to move into care.
However, there are a few downsides to renting out. If you’ve worked hard for years to secure your own property, you want to be able to enjoy it.
There’s nowhere quite like home, and sometimes the biggest challenge could be the emotional impact of leaving. Plus, if the location still suits your life in retirement, staying put would certainly save the stress of moving elsewhere.
What about equity release?
By opting for an equity release mortgage, you can release some of the stored funds and use them elsewhere. It involves a lender giving you cash in exchange for a share of your property, and although this might sound daunting, it’s a great way to enjoy your assets without selling up.
You could either take the money in one lump sum or withdraw in smaller amounts over time. This generally means your family won’t have as much to inherit, but it could be a fast route to more cash through your golden years.
Whether you choose to rent out, renovate, stay put or take equity release, make sure you’re aware of the process. Always put your own wellbeing first, and don’t be afraid to seek professional advice to help organise your assets.