Posted by Admin-VA on Jan 22, 2013 in Blog, Calgary Real Estate News | 0 comments
How? to downsize thoughtfully? Check this out!
Over the past 15 years, we have seen debt rise across the nation, and more and more Canadians are retiring with debt. According to a recent survey by CIBC, 59 per cent of retirees are carrying debt in retirement and the trend may continue as more baby boomers head into their retirement years.
What happened to the notion that we had to be debt-free before we retired?
Over the past 20 years I?ve been asked an increasing number of questions by attendees at my retirement seminars. ?Can you still retire if you are not debt free?? ?Is it OK to have debt in retirement?? ?How do you pay down debt in retirement?? ?Are reverse mortgages good??
A common solution is to downsize. For most people, this simply means selling a large, family-style home and buying a smaller house that is more suited to retirement. While downsizing may appear to be an intuitive solution, it may not help with the finances as much as you think.
I recently met a woman who wanted to sell her bigger home and move into a condo, but she soon realized that despite being smaller, the condo would actually cost more. The condo designed for retirees was new, with lots of upgrades, compared to her 20-year-old house. It was a real reality check to discover that her downsizing retirement plan was not going to save her any money.
CONDO FEES IN RETIREMENT
Retirement communities are becoming increasingly popular for the lifestyle benefits they offer, such as lower maintenance from smaller houses and yards, and travelling with peace of mind knowing your place will be looked after.
It?s important to be aware, though, that these communities usually involve monthly condo fees or strata fees, which can really impact finances in retirement.
While it?s not always a solution, I?ve met many people for whom downsizing has been financially rewarding. Some have prepared for retirement by buying vacation property, then downsizing from two homes to one. Others have sold homes in more expensive cities to move to quieter ones and have saved money that way. Others have utilized traditional downsizing to their advantage by moving from a bigger home to a smaller one.
There is no cookie-cutter solution . The lifestyle you want in retirement ? including family, hobbies, climate and health ? will strongly affect the house you choose.
For some, downsizing brings the opportunity to clean out years? worth of collected household items and start fresh. But many struggle with throwing things away and selling a family home that is filled with memories.
If you are looking to downsizing as a way to reduce debt in retirement, make sure you plan ahead and explore your options early.
Jim Yih (twitter.com/jimyih) is a financial expert. Visit his award-winning blog , RetireHappyBlog.ca
? Copyright (c) The Edmonton Journal
Downsize Thoughtfully ? by The Edmonton Journal
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About The Chamberlain Group: Jared and Rebecca Chamberlain are Calgary REALTORS? who are changing how real estate is done in Calgary by utilizing online marketing and advanced tools to sell your house in Calgary faster and for far more money. They would be honored to have the chance to work with you and earn your business. ____________________________________________________
Source: http://www.homesinpanoramahills.com/downsize-thoughtfully/01/2013/
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