Your home is a focal point in retirement
Written by Jim Yih •
Your relationship to your home is a very personal one. Decisions about whether you purchase a home or rent and whether you move to another home in retirement will vary dependent on your values, interests and personal circumstances.
One way to evaluate living arrangements in retirement is to see your home as the focal point of your lifestyle:
· Health Care. Where you live will determine your access to health care, the availability of medical professionals, and whether or not services are free or provided on the basis of a fee.
· Finances. Where you live on December 31st of each year determines the marginal tax rate you will pay.
· Legal/Estate. Your primary domicile (or where the majority of your activity takes place) will determine where probate will begin.
· Tax. Your principle residence is also tax exempt
· Support. The location of your home in retirement can be instrumental in the degree of support you may be able to receive from relatives and friends in times of crisis.
· Leisure and Work. Where you live also determines what activities you may be able to do in retirement as recreation or as opportunities to utilize skills and knowledge in the workplace.
Should I stay or should I move?
Is the house you are in now, the house you see yourself in during your retirement? Many factors can influence the decision to stay where you are and age in place.
· long residency
· family associations and memories
· proximity to family and friends
· sweat equity (the time and effort given to making the house a “home”)
· neighbours and neighbourhood support
· ownership (in the case of home owners)
For those who struggled for many years with seemingly endless mortgage payments, the satisfaction of finally owning your home can be a significant reason to stay put.
Is your home ready for retirement?
Many Canadians have looked at renovations, both big and small as a means of improving the home. One of the questions to ask yourself is whether it is best to have these renovations completed before you retire.
Generally, homes require regular maintenance, repairs and renovation. Ideally, the costs of repair and renovation are best managed while working unless you are planning to do the work yourself in retirement. The advantage of renovating before retirement is that it can create a 15-year window in retirement, where the costs for the renovations do not have to be accounted for within the retirement budget.
Another consideration is whether your home can be adapted as your personal health situation changes. Changes in health and mobility may make your current home less than ideal and potentially make moving a preferred option. Evaluating, potential barriers in your home and considering any safety concerns may help you realistically assess the suitability of your home in retirement.
An important long-term consideration in choosing a retirement location is access to services and support from family and friends. Consider the implications of losing one’s ability to drive a vehicle (for example due to failing health). Would your present location allow you to continue staying in your home or would your location, under those circumstances isolate you?
Have you thought about where you are going to live in retirement? Will it be the house you are in? Will you move and why?
For information on home adaptation options and financial assistance see the website of Central Mortgage and Housing Corporation at http://www.cmhc-