Housing is likely to be your biggest retirement expense. But there are a variety of ways to pay less for housing in retirement. Here are a couple of ideas of what you can do to bring down your housing costs after you retire.
Downsize. Once your children grow up, you no longer need multiple bedrooms or an expansive yard. And you may not want to take care of a large property that only one or two people use. Downsizing to an apartment in Beaufort, SC can add money to your nest egg and free up the time you would have spent mowing a large lawn and cleaning several stories of rooms. Downsizing could add money to your nest egg, even if you spend $50,000 on selling and moving costs and home improvements. After their kids move out, many retirees downsize their home, and then they put the surplus into an investment account so that it can start growing. This reduces their monthly living expenses, their utilities, their property taxes, and they’re really at a point in their life when they don’t want to maintain a larger home. You may also be able to generate some extra cash by selling off the furniture and appliances from your former home.
Relocate. Retirees don’t need to live in expensive cities that are close to their jobs or in high-cost suburbs with good school districts. You are finally free to live anywhere in the world that has the entertainment options and amenities you desire. You might choose to live near the beach or in a place where you can play golf every day, or you could relocate to a sleepy college town with a low cost of living. If you move to a place where housing costs significantly less than where you live now, you can use the extra cash to help pay for your retirement expenses.
Become a renter. Homeownership can be expensive and a lot of work, especially if you live in an older home in constant need of repairs. Becoming a renter in retirement frees up the equity in your home to use for living expenses, might allow you to relocate closer to the city center where you could walk to shops and local attractions and makes someone else responsible for the major upkeep of the property. To sell your home and then rent gives you a nice cash infusion.
US News – Money