There’s no debate that homeownership and financial stability go hand in hand, and this is all the more important for you when you retire.
For most of us, the overarching goal for retirement is financial comfort, and being dead broke is the last thing you want to be saddled with when you retire.
I recently saw a statistic that the average 65-year-old renter has a net worth of just $5,700. Contrastingly, the average 65-year-old homeowner has a net worth of $305,000. It makes sense, then, that owning a home is a causal factor of financial stability into retirement.
So what are the benefits of homeownership?
First of all, having a mortgage results in forced savings. As you pay on your home each month, you’re paying down the interest as well as the principal. Over time, you begin to make headway in paying the principal balance.
There are also tax incentives to becoming a homeowner. Many receive tax breaks on their mortgage interest, property taxes, etc. Speak with your tax professional about this to confirm what home-related tax breaks you’d be eligible for.
If you’re a renter, you’re undoubtedly familiar with the fact that rent increases periodically. Homeowners don’t ever have to worry about increases in this way.
By making improvements to your home, you’re earning what’s known as ‘sweat equity.’ This can come in the form of your own sweat or sweat dollars that you pay a professional for home improvements.
Exercise caution with this last one, but homeowners can also borrow against their home. Retiring at 65 with a mortgage that’s to the hilt is certainly less than ideal, but if you have an asset with equity (in this case, your home), you can borrow against it and get money.
If you’re interested in buying a home and just exploring your options, we’d be happy to help and answer your questions. We can even get you in touch with a lender who can determine your qualifications for homeownership. Please call or text me at 858-457-5368 or send me an email at Gary@GaryKent.com.
