The best option largely depends on your needs, goals, and expected future income, so it's always a good idea to talk with experts in the field to get some guidance.
Relocate Your Residence
Retired couples often find themselves living in a home that's much too large without any kids running around. Without the need to be located near work, senior homeowners can consider many more home options that might provide the same or better quality of life for less money.
Selling your existing home and getting a more affordable mortgage on a new residence can give you a lot more financial flexibility when planning your retirement.
Pay It Off
Some retired couples aim for mortgage programs that lead to them paying off their mortgage as quickly as possible. While this can create a short-term budget crunch and require careful spending decisions, it can also greatly ease the strain monthly payments have on a limited income.
Even if you can't pay it off completely, putting more money towards it in the years leading up to retirement may be the best option.
Refinance on Equity
Preserving your stake in the value of your home isn't always the right choice. Seniors who find themselves facing difficult circumstances or need immediate access to cash sometimes consider refinancing on equity. This may provide vital relief from immediate circumstances or allow retired couples to invest it elsewhere as they see fit.
Consider Reverse Mortgages
Reverse mortgages are similar to loans on equity, but they are generally easier for retired couples to manage. Typically, homeowners can remain in their house and continue living there without making payments on the loan.
Once the homeowners are deceased, the lender gains claim to the home unless any existing heirs are willing to pay back the debt. The loans may come due earlier if the homeowners move or stop living in the residence for an extended period.
As most financial advisors will tell you, it's better to start planning for retirement decades before your designated exit date. However, even people who are approaching or already reached this milestone still have plenty of options when it comes to managing their home value and personal finances.
