5 Financial Tips for Renovating Your Retirement Home
Whether you’re nearing retirement or already enjoying your post-work days, you may be thinking about upgrading your home. In fact, there are many reasons why you could be considering a home renovation. For one, a home improvement project can increase the comfort of your everyday life, creating a luxurious lifestyle many look forward to after their career years. For others, a home renovation during retirement may be a necessary health and safety measure. No matter the case, taking into account the following five considerations may help you maintain financial health throughout retirement — while experiencing the home you’ve envisioned for yourself.
1. Consider Energy-Efficient Systems
When possible, opt for energy-efficient setups and materials. Energy-saving windows, for example, are designed to keep hot or cool air inside your home, reducing the strain on your heating and cooling systems and lowering your energy-use costs. Similarly, insulation upgrades can reduce heat and air loss as well. Other areas to save energy include high-quality HVAC systems with automated adjustment settings and water systems, such as demand water heaters that offer hot water only as needed. Not only will you save on energy costs, but in many cases, you can claim a tax credit on your tax return for using energy-efficient equipment.
2. Go With Durable Materials
Choosing long-lasting materials can prevent the need for repairs in the future, lowering the cost of maintenance. On the exterior of your home, going with PVC or composite lumber for renovations, such as a new deck, results in less maintenance in the long run than a material such as wood. Unlike wood, PVC or composite lumber won’t splinter or crack over time, which is ideal if you plan on living in your retirement home for many years. On the interior of your home, opting for durable materials can also lower costs. For example, if renovating your kitchen, hard surface counters like granite or other man-made materials are easy to clean and maintain.
3. Increase Comfort & Lower Healthcare Costs with Preventative Measures
Setting up your home to reduce the chance of accidents can lower healthcare costs while increasing your comfort. Updating bathrooms by adding grab bars makes them easier to maneuver, and replacing tubs with curbless or low-curb showers enables you to walk right in without needing to climb. Along similar lines, installing non-slip flooring minimizes your chances of falling. All of these measures can reduce the possibility of injury. Other renovations could include replacing knobs with D-shaped pulls, which are easier to grip. Overall, taking preventative action can make your home more comfortable and reduce accidents. Doing so can help lessen the chance you’ll need to make even larger renovations down the line to accommodate reduced mobility.
4. Renovations Can Increase Your Property Value
If you’ve thought of selling or renting your home in the future, the right home improvement projects may up the value of your house. No matter where your property is located, projects such as adding a wood deck or modernizing your kitchen and bathroom have the potential to increase the value of your home when you’re prepared to sell.
5. Choose the Right Financing Option for Your Situation
If not paying upfront for your home renovations, you’ll have to borrow money through other means. Several options include a home equity line of credit, which may have a lower interest rate than other loans, and any interest could be tax-deductible. Other possibilities include traditional bank loans or credit card promotions that offer 0% APR financing or reward programs offering cashback. If you qualify, government-backed loans, such as Fannie Mae’s HomeStyle Loan or FHA 203(k) loans often are secure and have favorable interest rates.
Some might consider moving into a new home that is already equipped with your desired amenities. This can be the case if the cost and inconvenience of the renovation look like they will outweigh the benefits. When possible, planning ahead of time to save for a renovation makes for smoother financing. You can work a large project into your retirement spending plan and fixed income by working with an advisor to budget or minimize fixed expenses. With the right planning, you can experience financial well-being while enjoying a new-and-improved home during retirement.
This content is developed from sources believed to be providing accurate information, and provided by Twenty Over Ten. It may not be used for the purpose of avoiding any federal tax penalties. Please consult legal or tax professionals for specific information regarding your individual situation. The opinions expressed and material provided are for general information, and should not be considered a solicitation for the purchase or sale of any security.