3 Moves to Make Once Your Children Move Out of Your Home
As an empty-nester, you have a prime opportunity to shore up your finances.
- Adjusting to a child-free home takes time.
- If you no longer have kids living at home, there are steps you can take to slash your spending and boost your income.
Some people count down the days until their children have grown up and moved out of the home. Other empty-nesters miss their children and long for the days of a noisy household.
No matter which camp you happen to fall into, as an empty-nester, you have a solid opportunity to improve your financial picture. If you're newly retired or are approaching retirement, it pays to jump on the chance to cut your costs and boost your income. Here are three things that could help you do that.
1. Look at downsizing
Once your kids move out, you shouldn't need as much living space. If you stay in the same neighborhood but downsize from your current home to a smaller one, you might save a lot of money on housing.
For one thing, if you're still carrying a mortgage, selling a larger home and moving into a smaller one should result in a smaller loan and a lower monthly payment to go along with it. Your property tax bill should shrink once you shed some square footage, and your homeowners insurance and maintenance costs might drop as well. Plus, it generally takes less money to heat and cool a smaller home than a larger one, so you should save money on utilities if you give up some living space.
2. See about renting out part of your home
You may want to stay in your current home even if it's a larger space than what you need, whether due to sentimental reasons or the desire to avoid the hassle and expense of a move. If that's the case, it pays to look into your options for getting a tenant.
If you have a separate part of your home, like a finished basement, that allows for ample privacy, renting it out could enable you to secure a steady stream of income via monthly rent payments. Those payments could help you pay your own housing costs, pad your retirement savings if you're still working, or have more income to pay the bills with once your career comes to an end.
That said, you'll need to research local zoning rules to see if your home is suitable as a rental. You may need to meet certain requirements before advertising for a tenant.
3. Look at relocating to a new area altogether
If you're retired or still working, once your kids have moved out of your home, it could pay to relocate to a part of the country that's less expensive.
If you're still working but can do so remotely, you might get a chance to stretch your paycheck even further and have more money left over to allocate to your retirement nest egg. Meanwhile, if you're no longer working, it's important to live someplace where your savings and Social Security income can go further. And relocating could be your ticket to lower living costs that buy you more financial freedom.
Having your children move out is an adjustment. If you're now an empty-nester, it pays to consider these moves that could change your financial picture for the better.
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