Retirement Is Changing—And So Are Your Housing Options

The old days of selling the family home as we near retirement and buying a new one in a different area—or downsizing to a smaller property—are changing. The more I talk to my getting-closer-to-retirement clients, the more I see shifting priorities. This month, we’re looking at the pros and cons of renting versus buying during retirement. In a future article, I’ll dive into the financial considerations of both options.

The question is, why am I hearing this dialog? Why the interest in renting? Well, many older folks are thoughtfully re-evaluating their retirement priorities. We’re living longer and maintaining good health. We don’t want to be “tied” down to a property. After working hard to build up a nest egg, it is time to enjoy life with more freedom and flexibility!

Now, let’s take a look at a few positives and negatives of renting instead of purchasing another home during retirement.

Renting Provides…

Here are a few of the positive reasons to rent a home during retirement:

• Flexibility to pick up and travel for extended periods of time—now is the time to check off those bucket list adventures
• The benefits of living in a more updated home with green-built and safety-focused features
• Less overall stress and fewer worries about home maintenance
• More liquid assets (cash) to gift to family, without the complications of probate or trusts
• Opportunities to meet like-minded new friends
• A community environment and social amenities that help reduce isolation
• Significantly lower upfront costs for leasing compared to purchasing another home
• Predictable monthly expenses for the duration of the lease

Renting May Cause…

Here are a few of the negative reasons not to rent a home during retirement:

• Rising monthly rent and living expenses
• Risk of needing to move if the home or building/community is sold
• Lack of control over changes in the community’s or neighborhood’s maintenance
• Reduced personal space and privacy between neighbors
• Loss of a private garden or outside living areas
• Noisy neighbors and noisy pets
• Turnover of rental management personnel, which can negatively impact how home concerns are addressed
• Increasing rules and restrictions imposed by the community association
• State approved rules that favor landlords over tenants

Other Alternatives

Have you considered cruise ship permanent living? Check out the cruise ships that offer full-time cruising in a personal suite with all the amenities: free meals and drinks, free entertainment, free adventure, carefree globetrotting, and more! I just spoke to a couple of my 55-year-old clients, and they are counting the days until they can sell the family home to buy a permanent cruise suite. I hope they invite me to visit!

I am very interested in monitoring the trends as we 76 million baby boomers gracefully age and retire into phase two of our lives.