|Financial Planning | Budgeting | Saving | Investing | Retirement | Legal Documents | Senior Living Costs | Long Term Care Insurance | Real Estate | Interest Rates | Charts|
Your decision will depend a lot on nonfinancial, emotional issues, as well. Do you love the idea of owning your own place and fixing it up the way you want? Or will it be a big relief after years of ownership not to worry about the lawn or a broken sump pump?
You can avoid some of the maintenance hassles by getting a townhouse and just paying home owner Association fees.
Scenario 2015: 65 year old couple in the 25% tax bracket sell their large house and clear $550,000. They have $100,000 in a IRA and $100,000 in a taxible account. Comparison for renting at $1,250 plus utilities vs. buy a $230,000 house with 20% down and a 30 year mortgage. Assumption: Investments would grow at 6.9% Total assets after 10 years: Rent $576,202 Buy $572,071 (home equity and investments) They also ran it for a couple with $1 M with similar results.
Maintenance (repairs, painting, pest control, appliance replacement, Landscape maintenance, ...) 1-4% of value. Utilities (electric & gas) Property Taxes Links:
Best Places to Live