Retired Couple Making Over $9000 A Month With $1 Million Savings Can't Agree Whether To Buy Or Rent — Suze Orman Says 'Listen To Your Wife'
As retirement approaches, many couples face crucial decisions regarding their living arrangements. One such couple recently sought advice from financial expert Suze Orman on whether to buy a home or rent a luxury senior apartment.
The husband and wife are financially secure, with a combined monthly income of over $9,000 from pensions and Social Security, savings of around $100,000, and $850,000 in an IRA, annuity, and Roth account.
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Orman first highlighted the couple's solid financial standing, noting they have no debt and can sell their current home for $450,000 to $500,000 without incurring capital gains tax. This financial freedom means buying or renting isn't strictly about money but lifestyle preferences and practical considerations.
She pointed out the physical demands of home maintenance as a significant factor for retirees. "They are in their seventies and are not sure if they are up to the challenge of daily housekeeping maintenance at their age," she said. KT KT echoed these concerns, highlighting that such tasks become increasingly burdensome as people age.
"After 70, you start to feel it," KT remarked, highlighting the importance of considering one's physical capabilities when deciding on living arrangements.
The couple is torn between the husband's preference for buying a home and the wife's inclination toward a luxury senior community apartment. The wife enjoys socializing and traveling, benefiting from the amenities and services such communities provide.
Suze Orman provided a compelling argument for the wife's choice, focusing on the benefits of senior community living. "You have a community around you," she said, recounting the positive experiences of both her mother and KT's mother in similar settings. These communities offer various activities and social opportunities, such as happy hours, educational classes, movies, swimming, and golf.
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Orman stressed the importance of moving to a senior community while both partners are healthy. "In most cases, you can't move in if one of you is seriously ill," she advised, urging the couple to make the transition sooner rather than later. She also noted women’s higher life expectancy, which could leave the wife managing a house alone if her husband passes away first.
Orman humorously warned, "Your husband probably shouldn't hear this part of the answer," referring to the predominantly female demographics of senior communities and the social perks for the few men who live there.
Financial experts often advise evaluating the costs and benefits of both options for seniors with existing homes like this couple. Selling a house can free up equity that can be used to fund other retirement needs or investments while renting can simplify life by eliminating the need for ongoing maintenance and large, unexpected expenses.
While buying a home can offer stability, and potential equity growth, renting may provide a more carefree lifestyle, especially valuable in the later stages of life.
Financially, the couple can afford either option. Orman, however, leaned toward the wife's preference for a senior community, emphasizing its convenience and reduced responsibilities. She advised the husband to "listen to your wife here because, in the long run, you're gonna be so happy that you did."
If you’re exploring options for your retirement living arrangements, remember that the right choice depends on your individual needs and priorities. Consider factors like home maintenance, social engagement, and desired lifestyle when making this important decision. Consulting with a financial advisor can provide valuable guidance and ensure you make the best choice for your golden years.
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