Young people often buy homes as a way to build wealth, gain equity and get the privacy and freedom they desire. Retirees often desire the same freedom and flexibility that home ownership affords. By working with Springfield real estate agents you avoid sabotaging your retirement with common home buying mistakes. According to an article by realtor.com, it is easy to overextend yourself financially, especially when working with a fixed income. For home buyers who are a decade or two away from retirement, consider buying a home you can afford while still putting aside at least 5 to 10 percent for retirement.
Buy a home in your price range
A Springfield MO Realtor will help you find homes in your exact price range. Experts say housing is the biggest monthly expense for most people. Take future earnings into consideration when choosing a home in Missouri.
Tap savings for a down payment
Putting down 20 percent on your Springfield home is a great way to avoid PMI or private mortgage insurance costs. At the same time, don’t tap your retirement account for a down payment unless it is a Roth IRA. With a Roth, you can take out the money you contributed without penalties. Raiding your retirement account is risky especially for those nearing retirement.
Take your time paying off your mortgage
Although paying off your mortgage early sounds like a good idea, you often lose the tax deduction. Experts say mortgage debt is “good debt.” If you spend money paying down a mortgage at a low-interest rate, you won’t have as much to spend on high interest credit cards or car loans with higher interest rates.
Downsize when the time is right
Don’t wait too long to downsize from your large home to a home that is easier to maintain. A good Missouri Realtor can show you homes that do not require as much work. Newer home include technology and energy-efficient perks that improve your lifestyle in retirement.
Other ways to make sure you have a secure retirement include saving up for unexpected home expenses. Owning a home is a great advantage for retirees because they often have lower housing costs compared to renters.
At Realty Executives By Realty Choice, we help people buying or selling real estate in Missouri. For more information on the perfect homes for retirement, please contact me. Julie Pickens Owner/Agent.