When you retire, wouldn’t it be great to leave the damp Pacific Northwest in the winter, and enjoy a second home in the sunbelt? Of course, you’d probably want to escape the triple-digit heat waves in the South during the summer. Keeping two homes may be the answer, but how do you manage both in retirement?
Start by deciding if you should buy or rent. A second home can be a great investment, the opportunity to create new friendships and build the lifestyle you have always dreamed of. Be sure to consider the cost of maintenance, property taxes, and insurance. You may consider renting out one of your homes when you’re not residing there, but you’ll likely need to pay a property manager as it can be difficult to manage a rental yourself, especially from afar.
Renting instead of owning a second home has benefits that include more flexibility should you decide to move or scale back to one residence, and less financial worries about maintenance and home values, plus you don’t have to tie-up your nest-egg in a down-payment. Drawbacks are that your landlord can up the rent or sell the property. As a renter, it can be more difficult to build a sense of community and stability in your second home.
How you prepare for leaving one home when you go to the other can be a large factor in determining the success of your two-home lifestyle. Here are some things to consider when closing one home and opening the other: • Bank with a national bank • Have the Post Office forward your mail • Alert your insurance company as this may be a requirement in your policy • Pay most bills online • Stop newspapers and deliveries • Place timers on lights and hire a lawn service so the house doesn’t look vacant • Let neighbors know you’re leaving • Turn off the water main if the home you’re leaving is going to be vacant during freezing weather • Place open boxes of baking soda or activated charcoal in the refrigerator, and under the sinks • Dispose of or donate all perishable food • Unplug small appliances • Hire a service to come every-other week to dust, flush toilets, check for leaks, infestations, and other maintenance issues that need immediate attention. • Hire a property manager if you plan to rent out one of your homes when you’re not there.
By understanding your income and expenses, and planning ahead, you may be able to enjoy two homes so you can spend your retirement where the weather is better, and it’s easy to get outside and stay active. Retirement could end up being some of the best years of your life! If you would like help assessing your situation and deciding if there are two homes in your future, we can help you at Penny Lane Financial. Contact us to set up your complimentary one-hour consultation.