Most of the time the debate over whether to buy or rent a home takes place among Millennials.
Rarely do you hear people approaching retirement debating whether or not they should buy a home when they downsize and relocate. But Jane Bryant Clark, senior editor at Kiplinger's Personal Finance, says it's a discussion that more retirees ought to be having.
Financial advisors weigh in
Should they rent instead of own? The question was posed to a number of financial advisors.
Many were receptive to the idea of renting. Most of them seem to think there are some very good arguments for it. Renting is more flexible, expenses are more predictable. They seemed to think it was a good option, actually.
It's flexible because you normally sign a one-year lease. No matter how long you stay, when you leave it's a lot easier because you aren't listing a property for sale. You just move.
Financial advisors worry about their clients who retire and embrace big changes, like moving from the suburbs to the city, or moving to an entirely different part of the country.
It’s a big lifestyle change and its possible retirees just won’t like it. Many of the financial advisors think it's not a bad idea to rent for a while after retirement, just to see.
The economic argument
Besides whether or not you're happy in your first move in retirement, there's the matter of dollars and cents. Retirees can't automatically assume that buying a home makes the most economic sense – you have to crunch the numbers.
Use a rent vs. own calculator. Punch all the numbers in and see which option makes more sense, based on how much you expect to get out of your house, how much you expect to spend on rent.
There are always arguments for both sides.