Your budget is the most important aspect your new life because it will determine the cost of your senior living. The budget, however, begins and ends with the cost of your new home in a 55+ community.
Everyone has their dream life in mind when they want to retire. Some people want to become yoga experts, maybe they want to finally start collecting enough books for the mini library they’ve always wanted, and some people just want to rest and take measure on what they have accomplished over the years.
Whatever you want to do in your 55+ years is totally up to you! That’s the beauty of senior living, and retirement. On the other hand though, you do have a basic requirement and that is living within your means. Sure, we all budget out costs for medication, medical bills, social life, and utilities, but for some reason very few people think about the cost of their home.
Yes, you want to live your dream life, but how much are you willing to pay to make that happen? Can you afford it? Consider the cost of the retirement home you are looking to purchase and that that – in essence – it’s going to cost you about $500 for every $100,000 you have to borrow.
In other words, if your retirement home is going to cost 200k, that payment is going to be in the ballpark of about $1000 per month. Also consider the fact that this is BEFORE taxes, insurance, and HOA fees. Combine all that together, and your payment could be as high as $1700 – $2000 per month! This isn’t to say that you haven’t saved up enough money to buy your place outright, or that you can’t afford to get the loan you need – but you NEED to consider this BEFORE you write out your wish list.
Do you have to have waterfront? Do you have to be 10 minutes away from your grandkids? How about living next to the city for the nightlife? Perhaps you need a two car garage? Granite countertops with Viking appliances? All of those things are great! Though, the cost extra money and if it’s within your budget, then go to town!
While you want your dream house, it’s important to factor in the rest of your life’s needs. Food, medical bills, insurace, utilities, etc., are ALL need to be paid every month. You need them. Of course, part of living in a retirement community is also HOA fees. So that’s coming every month too. Factor in what all these costs are goin to be FIRST, then you can see what you can afford on a monthly basis for a payment of your new home.
Whatever you have left is what you can afford. Then you can start your search for the home of your dreams.