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Info Seeker
Posts: 2
Registered: ‎07-06-2011

Re: Purchasing a Home After Retirement

Message 1 of 22 (31 Views)

I originally posted about a second home I bought in Las Vegas, during the bottom of the recession. Last year I sold it because it was really small (1021 sq') and I found the kitchen was just too small for me to enjoy cooking. So after owning it for 8 years, I made quite a bit of money on it (and will have to pay capital gains on the profit) and then purchased a slightly larger home in the same development. And now comes the wrinkle: I had no mortgage on the first vacation home, but took a small mortgage on the new one, thinking I'd be able to deduct the interest (and, of course, the property taxes). But no...the new "good for the middle class" tax plan that just may pass both houses of Congress, will undoubtedly deprive me of at least one of those two deductions. I really don't know how much the new tax laws will affect my husband and myself, but I have a bad feeling that we will be one of those for whom it might spell the end of a very lovely snowbird season. (Maybe Donald will let us stay for free at Mar-a-Lago??)

Silver Conversationalist
Posts: 36
Registered: ‎11-14-2012

Re: Purchasing a Home After Retirement

Message 2 of 22 (45 Views)
I hope you didn't sell off your losses. The market is up 150% since then so if you kept everything it would be worth a great deal more than you had before the crash.
Silver Conversationalist
Posts: 36
Registered: ‎11-14-2012

Re: Purchasing a Home After Retirement

Message 3 of 22 (45 Views)
This is just a thought...

With interest rates so low and with the market booming, you can make 10% on investing your cash instead of plunking it down on your house. We refinanced and my wife wanted to greatly reduce our mortgage. The lender told us what, are you crazy? We are only paying 2.5% interest. we are making a few thousand a month on top of paying the mortgage with the profits made from the money we were going to pay off the mortgage. We happened to hit the lowest rate in over 50 years but rates are still very low. To make it work, you need to know where to put your money to make 10% or more on your investments. Putting it a CD may lose you money. I just wanted to throw that out there since the standard plan is to pay off your house. Right now that is a poor financial decision.
Info Seeker
Posts: 2
Registered: ‎06-28-2017

Re: Purchasing a Home After Retirement

Message 4 of 22 (71 Views)

We are building a new home, one level, in an area we adore. Moving into a regular community, not a retirement community, to be engaged in regular life and not the "retiree" life. Selling current home, will pay off new house so, that there is no large debt in returement.  Owning a home that you choose for your retirement means that you have a safe place to live and enjoy for many years. I am so looking forward to our new home, no mortgage and knowing that we will not have to leave our home! 

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Recognized Social Butterfly
Posts: 795
Registered: ‎03-06-2010

Re: Purchasing a Home After Retirement

Message 5 of 22 (1,024 Views)

ttryu,

Your post shows that sometimes you can overcome setbacks and succeed!  2008 was a catastrophic year financially for so many (including myself) but you endured a loss of job and divorce.  I am so glad your life has improved.  Would love to know how you are doing.

 

LVSHOE.gif


ttryu wrote:

Hi, I can understand your situation.  I myself have lived in Brookly/Queens for 25+ years.  Just like yourself, I have never been good at driving.  Instead of mostly renting, I did own a couple of houses at one point in Queens.  However, I could not support the payment well at the time.  So I had to sell.  After a very bad year in 2008, the year when I lost my job of 17 years working in a bank, I got divorced, and my investment lost over 360k, I have come to Las Vegas and used cash to buy my condo.  my goal at the time was to duplicate my real estate investing success in NYC.  I first came here without a job.  Without a steady job, no one was willing to lend me money to buy.  Even after I got a job, I still had trouble to get a loan in the beginning because my job history was too short.  I did not get discouraged and got a loan from the builder to buy my primary residence.  Fast forward to today, I now own 5 rentals and plan to buy more.  I also have uncovered many more finance options to buy even more rental houses.  All these things have happened in my late 40's early 50's.  I know sometimes investing in real estate involves luck such as my coming to Vegas at the right time (2010).  Timing and doing research are more important than just being lucky.


 

Bronze Conversationalist
Posts: 17
Registered: ‎07-17-2011

Re: Purchasing a Home After Retirement

Message 6 of 22 (1,642 Views)

yuffie, you need to check on doing a file and suspend.  The rules changed and the last word I've seen says you can't do a file and suspend to draw spousal benefits if you are entitled to your own benefit that is more than the spousal benefit would be.

Silver Conversationalist
Posts: 36
Registered: ‎11-14-2012

Re: Purchasing a Home After Retirement

Message 7 of 22 (2,004 Views)

Usually, there is a great deal of luck with a first time success.  Still, you need to see the opportunity for what it is and take the plunge.  That is where reserch is needed. Like finance, you need to know your stuff to be successful. You are fortunate to have aquired that information so early.

 

Pat yourself on the back for getting out of that hell hole!  Not that it is really a hell hole if you have a job but is was and still is one for a banking professional looking for work or in any financial position.  My wife and I have a good bit of our family there.  The banker survived because she was the only one in the US at the bank that had her level of expertise and could write up a disclsure on how the bank would respond to several disasters.  The D F bill mandated every bank was required to provide this discloseure. They had a 50% cut then another 50% cut a year later.  What a horror!  My brother's wife survived a 90% cut in a brokerage firm.  Now the job is 1.5 hrs away in NJ.  I have meet refugees from that area coming to my area for work.  They had been looking for a job for years.  If you look at job participation rates instead of unemployment you will see a 10% permenant cut in jobs for US citizans.  Alians and illeagals have increased 11-12% and that is why we have more jobs now than 8 years ago.  That is no help to anyone out of work in an environment with few openings and hoards of persons trying to fill the job. 

Conversationalist
Posts: 6
Registered: ‎10-10-2012

Re: Purchasing a Home After Retirement

Message 8 of 22 (2,065 Views)

Hi, I can understand your situation.  I myself have lived in Brookly/Queens for 25+ years.  Just like yourself, I have never been good at driving.  Instead of mostly renting, I did own a couple of houses at one point in Queens.  However, I could not support the payment well at the time.  So I had to sell.  After a very bad year in 2008, the year when I lost my job of 17 years working in a bank, I got divorced, and my investment lost over 360k, I have come to Las Vegas and used cash to buy my condo.  my goal at the time was to duplicate my real estate investing success in NYC.  I first came here without a job.  Without a steady job, no one was willing to lend me money to buy.  Even after I got a job, I still had trouble to get a loan in the beginning because my job history was too short.  I did not get discouraged and got a loan from the builder to buy my primary residence.  Fast forward to today, I now own 5 rentals and plan to buy more.  I also have uncovered many more finance options to buy even more rental houses.  All these things have happened in my late 40's early 50's.  I know sometimes investing in real estate involves luck such as my coming to Vegas at the right time (2010).  Timing and doing research are more important than just being lucky.

Silver Conversationalist
Posts: 36
Registered: ‎11-14-2012

Re: Purchasing a Home After Retirement

Message 9 of 22 (2,110 Views)

Firstly, congradulations for retiring in style as I do the others who responded to my post.  You have all done very well.  There are many ways to do that and it dosen't matter how you accomplish it as long as you are successful. 

 

I now regret I have not done more in the landlording but I am less handy than many of you.  Being able to DIYS makes that easier.  I have actually gotten handier when I was out of work for an extended period of time.  Our next house will be mostly a rental vacation house. I would welcome any suggestions anyone has.  I have made my mistakes in the financial arena and learned from them but I have stayed out of realistate.  I am in my late 60s and am too old to be able to make stupid mistakes. I do believe not investing in a beach house was a missed opportunity.  We live only a few hours from the beach and realistate has doubled to quadrupled in my area. I have lost the chance to learn the ropes when I should have.  

 

I have little reguard for financial advisers. They are not tallented enough to become successful brokers/portfolio managers. Their biggest contribution is that they provide independent and detached advice.  This is more important for someone who can't apraise their plans from a detached view.  The concept that how much you need to save anually is calculatable is hog wash.  What you need mostly depends on the year you will die and how much money your investments will make each year.  These are not knowable. You ought to save as much as you can. I don't recall anyone complaining that they have too much money.

 

I do believe you need to reduce your risk after you retire.  I see my future mortgages as small managable risks.  I have a bit more than 80% equity on my home.  On our next purchase I will ask the loan officer how much we should plunk down.  We would never concider a home we couldn't very confortably buy outright. Our retirement income will be about what it is now after adjusting for the cost of working.  Unearned income is actually more relyable than earned income.  I learned that in 1998.  I thought my career was unsinkable.  I learned the hard way that that is never true.

 

For the 'younger' members, you must have a plan to get you where you want to be in your 50s.  Your 60s is a time to be amassing your nest egg.  By then you had better have made all your mistakes in the past and have learned from them.   

 

Good luck to all of you!

Conversationalist
Posts: 6
Registered: ‎10-10-2012

Re: Purchasing a Home After Retirement

Message 10 of 22 (2,248 Views)

Good for you.  I don't think it is a must to pay off all mortgages after you retire.  As long as all payments are covered by your rental income, you could keep the mortgages and invest your free cash in better opportunities.  I am in my early 50's.  I own six homes and four have mortgages on them.  The reason is that my kids are still young.  Instead of being a grandparent, I am a parent of a teenager and a 2-year old.  Therefore, I have to plan for both my retirement and college education for my kids at the same time.  I have done well for my retirement savings (> 1mil).  However, I cannot say the same with my college savings.   My college expenses will come after I retire.  So having a good reliable income after I am unable to work  is critical.   Currently, my rental income covers all of my mortgage payments and left me with some extra cash.  It sounds good but it is not a smooth ride.  Sometimes I lose tenants because of natural disaster or other reasons.   Fixing up here and there is a common undertaking and the expenses are high sometimes.  I do hire property managers to manage my properties so I don't have to deal with the headache of collecting rents and screening for good tenants.  Being a landlord is not as easy as 1-2-3.  It requires a lots of patience and a good financial cusion.  There are many unexpected things happen and none are pleasant.  However I do like the idea of being a landlord.  I am 100% certain to buy at least one rental this year.