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Is Your Home A Retirement Asset?

In 1982, The Clash asked, “Should I stay or should I go?” Those old enough to remember that line may be asking it now, but in a new context. Do we move into a house that is better suited to our latter years or do we stay in the home that holds memories? It’s one of the more difficult decisions retirees face. Emotional implications notwithstanding, the financial stakes are pretty high, so let’s take a look at some of the pros and cons that might help you.


There are financial benefits to relocating. For most people, their home is the most valuable asset, and selling it might be the best way to partially fund retirement. From a purely financial standpoint, relocating also might enable you to find a place with a lower cost of living and any excess can pad your retirement. However, remember that there are costs associated with relocating: real estate closing costs, moving costs (packers, movers, any new furnishings/décor, etc), and the potentially higher interest rate if a new mortgage is necessary.


The advantages to staying put are just as tempting but more sentimental as opposed to financial. On the financial side, if you have already paid off your mortgage, or will soon, you have more expendable income. You know your costs for utilities, maintenance and what maintenance help you will likely need as you age. In addition, you may have quite a bit of equity that you can use for future emergencies by taking out a home equity line of credit (HELOC). Fair warning, however, a HELOC will come with a monthly principal and interest payment and will erode your equity. By far, the most important advantages to staying are emotional. This is the home where you may have raised your children, know every nook and cranny, and in which you feel comfortable and at peace. That counts for a lot.

Ultimately, whatever you decide must be well thought out and considered in detail. It’s best to consult with property and tax advisors before making such a big decision.