Navigating the Aging Home: Options for a Stress-Free Transition.

 

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As time moves forward, the question of what to do with our homes becomes increasingly important. Sometimes, thoughts about the alternatives can dominate our minds. Being aware of various options and choosing a path that makes sense can bring peace of mind.

Studies indicate that 90% of married couples and 62% of single individuals own their homes upon retirement. Beyond the financial aspect, deciding whether to stay or sell becomes a key consideration, with a major objective being how to turn home equity into income.

While selling may seem like the most attractive option, staying in the home could be simpler and less stressful. Many people lean towards selling without exploring all the options that allow staying in the home while extracting equity.

Consider the following options before deciding to sell:

 

Long Term Care Insurance:
        

A study in 2000 revealed that over 90% of seniors wish to stay in their homes for as long as possible.

Look into long term care insurance, covering home care or a comprehensive plan that includes it. Home care benefits may provide necessary assistance, allowing seniors to remain in their homes.

Home Upkeep and Maintenance:

As seniors age, home upkeep may become overwhelming.

Explore hiring help for cleaning, lawn maintenance, and other chores. It's often more cost-effective than moving to a retirement home.

Downsizing and Utilizing Space:

If the home is too big, consider closing off unused rooms.

Seal vents in unused rooms to save on heating and cooling costs.

Family Support:

Consider having a family member move in as a caretaker, reducing the need for external services.

Refinancing:

Explore refinancing the home, taking advantage of low mortgage interest rates.

Properly invested funds from the refinance could cover new mortgage payments.

Sale to Children:

Structuring the sale and lease-back to the children can utilize capital gains tax exclusions.

Gift-Leaseback:

If the homeowner(s) are age 62 or older, a reverse mortgage may be a viable option.

Reverse Mortgage:

Consider a reverse mortgage, especially if the homeowner(s) are 62 or older. It can provide a source of income.

Before deciding to stay or sell, involve the senior, their children, and financial advisors in discussions about these options.

Each option has its considerations, and making an informed decision ensures a smoother transition into this next phase of life.