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By Rhonda Underhill
It’s estimated that an individual turning 65 today has a 70 percent chance of requiring ongoing care at some point. That’s a major influx of older adults into America’s assisted living facilities, as well as a lot of people who will have to decide what to do with their homes once they move. Presumably, some will need the money they can earn from selling a house to fund their senior care, while others may elect to keep their property to generate monthly rental income to fund their care, especially if their mortgage is paid off.
Rental Property
As a longtime homeowner, it’s likely you’ve never considered using your house as a rental property, but it’s a potentially lucrative option for someone who needs the care that assisted living can provide. Renting provides an ongoing monthly revenue that can help you cover the cost of your assisted living. However, managing your property from an assisted living community may be unrealistic and may necessitate the hiring of a property management company.
If you do hire a property manager, make sure the company keeps you and/or your family apprised of what’s happening with your house and the people living there. These companies can help you handle the hard work of renting, like vetting tenants and handling maintenance needs on a timely basis. However, there are some negatives to renting out your home: For example, if Medicaid is part of your financial assistance package, your house will cease being an exempt resource if you’re no longer the primary resident. And if you still owe on your mortgage, renting probably won’t help with assisted living expenses as much as you’d hoped (unless your payment is very low).
Selling Your House
Of course, selling a house can provide the financial aid you need to move into an assisted living community. As much financial sense as selling might make, bear in mind that there are other factors to consider. For example, a home you’ve lived in for decades probably needs updating, possibly even major renovations, to make it marketable. According to the US Census Bureau, half of all homes sold by people 65 and older were built prior to 1975. You may also need to take care of smaller, less expensive updates, such as addressing your curb appeal, decluttering your closets, and giving your walls a fresh coat of paint. When you’re selling your home, every little bit helps, especially if you’re working within a certain time frame.
Selling your home also means no more worries about home maintenance and no more property taxes or home insurance costs. If you’re concerned about watching the proceeds of your home sale gradually dwindle and run out, consider purchasing a lifetime annuity, which guarantees a monthly income for you and/or your spouse.
Turn to Family
If you can’t bring yourself to sell or rent out the family home, reach out to your loved ones and see if someone would be willing to take care of the place after you move. It could be an on-site arrangement where someone moves in and becomes a caretaker, or you could pay a relative a stipend to check on the property periodically. Of course, there’s the risk that maintaining a house that no one’s living in can invite crime, which could make it necessary to invest in security/monitoring equipment, such as a motion-activated camera, or even a video doorbell.
A house is an important asset for seniors, and as such, it can help when your savings and financial resources are minimal. That’s certainly the case if you require ongoing care in a senior living facility, which can be quite expensive. As an invaluable asset, you have more than one option when it comes to drawing on your property. You don’t have to say goodbye to it to get what you need.
Image via Pixabay
Rhonda Underhill created getwellderly.com to share her passion for diet and exercise with other people her age.
