Retirees: what are you doing with all the home equity?

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1rl9DS5gl2
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Re: Retirees: what are you doing with all the home equity?

Post by 1rl9DS5gl2 » Thu Apr 16, 2020 9:53 am

My income is fixed and my investments are 100% in Roth and Traditional IRAs. I do believe that there will be money left over once my wife and I have died. This past year both of our adult (self-supporting) kids had the need for some cash (one for a sizable home improvement and the other for a divorce settlement). I'd rather help them now than hoard the money until they receive it as an inheritance. But I believed there was a large opportunity cost in withdrawing the money from our retirement accounts and so I took out a HELOC against our paid off home. I'm currently paying 2.24% on that money.

MathIsMyWayr
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Re: Retirees: what are you doing with all the home equity?

Post by MathIsMyWayr » Thu Apr 16, 2020 10:04 am

delamer wrote:
Thu Apr 16, 2020 9:17 am
MathIsMyWayr wrote:
Wed Apr 15, 2020 2:57 pm
AK62 wrote:
Wed Apr 15, 2020 12:25 pm
I'm not sure exactly what the OP is asking. Perhaps OP can clarify.

As a personal comment, I am not retired (yet) but my home is paid off. That stated, I would never take my home equity and invest in the market. Why? This is my home. I need it to sleep in, keep me warm and dry at night. I've heard of people taking a HELOC or equity out on their home and investing it in the market. That is an enormous risk. I depend on my home for shelter, so taking the equity and investing it is a big NO! Why would anyone in their right mind do that?
If you live in it, it only provides a shelter. The equity of the house does not do anything for you regardless it is $200k or $5MM. House rich, but cash poor. Great temptation.
Why would you assume that having house equity makes you cash poor?

Our home equity is less than 25% of our net worth. But even if it was 50% instead, that wouldn’t make us cash poor.

To use your example, if a retired couple has $5,000,000 in home equity and $5,000,000 in a 401(k), are they cash poor?
That is an ideal situation and there is no point in creating a problem when there is no problem to begin with. However, what would you do if you are house rich and cash poor? Still much better than house poor (or no house) and cash poor.

Retirement Nerd
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Re: Retirees: what are you doing with all the home equity?

Post by Retirement Nerd » Thu Apr 16, 2020 10:21 am

Watty wrote:
Wed Apr 15, 2020 2:53 pm
Living without any rent or mortage payment, that is called "imputed rent" and you can Google that.

One huge advantage of that is that I do not need any income to pay that so I do not have to pay taxes on that income.

It helps that I live in a moderate to low cost of living area but with a paid off house we could live a modest but comfortable lifestyle just with Social Security if we needed to.

If we ever need long term care then the home equity can be used for a safety net for that. If only one of use is surviving when that is needed then the house will be sold when they move into long term care.

I do have a small Home Equity Line of Credit that I use to smooth out my income to keep it low enough to get an affordable care act subsidy for health insurance but when I get on Medicare I will pay that off.
All good points. Setting aside any legacy concerns, are you modeling the use of the equity later in life in order to increase your potential discretionary spending now?

Chuck107
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Re: Retirees: what are you doing with all the home equity?

Post by Chuck107 » Thu Apr 16, 2020 10:28 am

Nothing, it exists, as do I.

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Re: Retirees: what are you doing with all the home equity?

Post by bighatnohorse » Thu Apr 16, 2020 11:15 am

tennisplyr wrote:
Wed Apr 15, 2020 2:37 pm
I'm 70, retired 9 years and living in a mortgage free home. Things are going fine, just wanted to see if maybe I'm missing something.
Comeon' roll the dice. Take out a home equity loan and make a BIG bet on the stock market.
You could be missing out on lots of fear and loathing.
FOMO - fear of missing out.

Flashes1
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Re: Retirees: what are you doing with all the home equity?

Post by Flashes1 » Thu Apr 16, 2020 11:21 am

I look at the value of home equity as a potential source of liquidity in retirement. It's the source for the absolute last need for money to pay bills.

Additionally, it's what I hope to leave my kids. We will receive inheritance and I would feel embarrassment if we didn't "pay it forward" to the next generation. I hope to spend all our investable assets, and leave the paid-for home (worth in the 7-figures) to our kids.

That's the plan - all subject to change of course.

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Re: Retirees: what are you doing with all the home equity?

Post by Rosencrantz1 » Thu Apr 16, 2020 1:00 pm

When we retired, we moved back into a rental we owned. Wow...did it ever need some work. The upside was that we didn't owe very much on it and we did the repairs and paid off the mortgage. So.... what are we doing with all the home equity? Not a thing. Even if we were to move to another home, I'd pay cash for it. I've learned I really enjoy NOT having a mortgage payment - I rather like having zero debt.

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Re: Retirees: what are you doing with all the home equity?

Post by Broken Man 1999 » Thu Apr 16, 2020 1:11 pm

HEDGEFUNDIE wrote:
Wed Apr 15, 2020 12:16 pm
ochotona wrote:
Wed Apr 15, 2020 12:06 pm
Sadly, my MIL has stated that much of her wealth is in her house. She's house rich, cash poor. Sadly, if there are no buyers, she's poor all the way around. This is a huge problem.
This is exactly the predicament I am avoiding with my interest-only mortgage which I intend to roll over into perpetuity.
HEDGEFUNDIE, do you have ANY equity in your home? I can see how your interest-only loan could work, but wouldn't you have to have some type of down payment to avoid PMI?

You idea is very interesting, assuming you could continue to keep your expenses lower than rent, or at least lower than home ownership.

Could you simply throw the house keys to the bank after the end of one of your mortgages, and boogie on down the road?

Broken Man 1999
“If I cannot drink Bourbon and smoke cigars in Heaven then I shall not go. " -Mark Twain

retire57
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Re: Retirees: what are you doing with all the home equity?

Post by retire57 » Thu Apr 16, 2020 1:13 pm

Living in it, debt-free and grateful. Equity means nothing unless you plan to move or die.

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Watty
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Re: Retirees: what are you doing with all the home equity?

Post by Watty » Thu Apr 16, 2020 1:24 pm

Retirement Nerd wrote:
Thu Apr 16, 2020 10:21 am
Watty wrote:
Wed Apr 15, 2020 2:53 pm
Living without any rent or mortage payment, that is called "imputed rent" and you can Google that.

One huge advantage of that is that I do not need any income to pay that so I do not have to pay taxes on that income.

It helps that I live in a moderate to low cost of living area but with a paid off house we could live a modest but comfortable lifestyle just with Social Security if we needed to.

If we ever need long term care then the home equity can be used for a safety net for that. If only one of use is surviving when that is needed then the house will be sold when they move into long term care.

I do have a small Home Equity Line of Credit that I use to smooth out my income to keep it low enough to get an affordable care act subsidy for health insurance but when I get on Medicare I will pay that off.
All good points. Setting aside any legacy concerns, are you modeling the use of the equity later in life in order to increase your potential discretionary spending now?
Not really. It is a safety net but in effect I am "spending" the income from it each month when I live rent free.

TravelforFun
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Re: Retirees: what are you doing with all the home equity?

Post by TravelforFun » Thu Apr 16, 2020 1:31 pm

cheese_breath wrote:
Wed Apr 15, 2020 12:36 pm
Up until DW's stoke nothing. Since then I sold the house and added the equity to the balance to pay for her care.
How big of a hassle was it for you to get the house ready, sell it, move to a new place, and adjust to the community and neighbors? I may need to do this a few years from now.

TravelforFun

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sergeant
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Re: 4 options

Post by sergeant » Thu Apr 16, 2020 1:32 pm

hudson wrote:
Wed Apr 15, 2020 5:47 pm
I see 4 options...do nothing, sell and rent, heloc, or reverse mortgage.
I don't have a mortgage and don't want any debt, so that leaves out a heloc or a reverse mortgage.
I did look at a reverse mortgage to see what it was about. From memory, one only got around half of the value of the house....a terrible deal. UPDATE: I ran lending tree's calculator for age 67, $400K house...payout...190K.
Sell and rent....UGH!
Only "do nothing" appeals to me.
I could make my children joint owners, but the will takes care of that.
Don't make them joint owners they will lose the step up in basis upon your death.
AA- 20+ Years of Expenses Fixed Income/The remainder in Equities.

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LilyFleur
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Re: Retirees: what are you doing with all the home equity?

Post by LilyFleur » Thu Apr 16, 2020 1:35 pm

I'm living in a modest, paid-for condo in a VHCOL area. It is my nursing home insurance policy.
Although I'm only 60, I am cognizant of keeping my footprint fairly small out of kindness to my children. We are very close, and I do not want to add a mess to their grief when I go.

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Re: Retirees: what are you doing with all the home equity?

Post by 22twain » Thu Apr 16, 2020 1:45 pm

Flashes1 wrote:
Thu Apr 16, 2020 11:21 am
I hope to spend all our investable assets, and leave the paid-for home (worth in the 7-figures) to our kids.
I seem to remember reading a number of threads here about disagreements among siblings about what to do with a jointly inherited home or other property. Dividing financial assets is much easier.
Help save endangered words! When you write "princiPLE", make sure you don't really mean "princiPAL"!

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Re: Retirees: what are you doing with all the home equity?

Post by curmudgeon » Thu Apr 16, 2020 1:54 pm

I regard our paid-off home as forming a stable base for retirement. As Watty mentioned, it provides an effective "imputed income" for housing, which is somewhat inflation-protected (property taxes and maintenance may still increase). It's also a store of value which has generally kept up with inflation (significantly exceeded inflation for our specific ownership).

The equity serves as a form of "deep reserves", which I don't expect to tap, but which is there in case of need. It's there in case we hit that "many years in long-term-care" tail risk. We might tap it for a CCRC buy-in in another 10 or 20 years, but don't have any specific plans at this time.

I've known folks who have tapped their home equity in various ways for retirement, but that definitely has some increased risk.

Lalamimi
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Re: Retirees: what are you doing with all the home equity?

Post by Lalamimi » Thu Apr 16, 2020 1:55 pm

Bought biggest house (and most expensive) we have every had 12/17. Laid off, so retired 3/18. Sold what was to be our retirement place 10/18, paid this one off and living on the remaining proceeds through end of this year (together with SS that just started). Plan to age in place here. Two guest bedrooms with baths, so a caregiver could actually live here. We are in good health (at least today) and are 66 and 68. Kids fairly close by. Enjoying our 1 acre, we are outside every day. Hopefully still here in 20 years. On edge of town, so still rural look, though a new Jr. High is being build behind us, and assume houses will follow.

MarkBarb
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Re: Retirees: what are you doing with all the home equity?

Post by MarkBarb » Thu Apr 16, 2020 2:04 pm

I'm spending the imputed rent I get from owning the house.

lws
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Re: Retirees: what are you doing with all the home equity?

Post by lws » Thu Apr 16, 2020 2:09 pm

Personally:
Paid off house is just a place where I live.
Monetary value of the place is currently irrelevant.
Plan to leave it for heirs if all goes well.
Can be used to supplement my LTC policy.
Glad I kept it. Couldn't stand being isolated in an apartment.

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TomatoTomahto
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Re: Retirees: what are you doing with all the home equity?

Post by TomatoTomahto » Thu Apr 16, 2020 2:11 pm

I’m retired, wife isn’t, but I’m answering anyway.

I tell my kids we’re an example of “do as I say, not as I do.” I tell them that at this stage of life, they should rent rent rent.

We bought more house than we needed two years ago. I wanted to rent an apartment, but nobody listens to me 😁. We paid cash $x. We are putting in approximately another $x in renovations (functional and cosmetic) and upgrades that will make living in the house less expensive — we should break even in around 47.3 years. Even though I was slightly opposed originally. I now love where and how we live.
Okay, I get it; I won't be political or controversial. The Earth is flat.

ScubaHogg
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Re: Retirees: what are you doing with all the home equity?

Post by ScubaHogg » Thu Apr 16, 2020 2:32 pm

slowbutsteady wrote:
Thu Apr 16, 2020 6:04 am
HEDGEFUNDIE wrote:
Wed Apr 15, 2020 6:57 pm
yangtui wrote:
Wed Apr 15, 2020 6:43 pm
HEDGEFUNDIE wrote:
Wed Apr 15, 2020 1:14 pm

This is exactly the predicament I am avoiding with my interest-only mortgage which I intend to roll over into perpetuity.
I need to model this out in Excel but on the surface interest-only mortgages seem like a good deal. For the average person they are probably bad but if you approach it the right way they seem to be a very powerful tool. Any general pointers or references you like regarding interest only mortgages?
Conceptually:

The value of an interest only mortgage =
the value of liquidity of the principal diverted to investment portfolio +
portfolio market return on that principal -
interest rate of the mortgage

"Value of liquidity" incorporates the volatility of the investment portfolio, the higher the volatility, the less likely the money will be there when you need it.

To each his/her own, but isn't the interest + maintenance cost more expensive than renting? Of course that's assuming comparable home exists.
On average I wouldn’t think so, otherwise landlords probably wouldn’t bother renting houses out
“There is no problem so bad you can’t make it worse.” - Chris Hatfield, Astronaut mantra

delamer
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Re: Retirees: what are you doing with all the home equity?

Post by delamer » Thu Apr 16, 2020 2:51 pm

curmudgeon wrote:
Thu Apr 16, 2020 1:54 pm
I regard our paid-off home as forming a stable base for retirement. As Watty mentioned, it provides an effective "imputed income" for housing, which is somewhat inflation-protected (property taxes and maintenance may still increase). It's also a store of value which has generally kept up with inflation (significantly exceeded inflation for our specific ownership).

The equity serves as a form of "deep reserves", which I don't expect to tap, but which is there in case of need. It's there in case we hit that "many years in long-term-care" tail risk. We might tap it for a CCRC buy-in in another 10 or 20 years, but don't have any specific plans at this time.

I've known folks who have tapped their home equity in various ways for retirement, but that definitely has some increased risk.
I agree with the “deep reserves” notion. Very high long-term care expenses or CCRC fees are the most likely reason we’d have to spend our home equity.

HEDGEFUNDIE
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Re: Retirees: what are you doing with all the home equity?

Post by HEDGEFUNDIE » Thu Apr 16, 2020 3:26 pm

Broken Man 1999 wrote:
Thu Apr 16, 2020 1:11 pm
HEDGEFUNDIE wrote:
Wed Apr 15, 2020 12:16 pm
ochotona wrote:
Wed Apr 15, 2020 12:06 pm
Sadly, my MIL has stated that much of her wealth is in her house. She's house rich, cash poor. Sadly, if there are no buyers, she's poor all the way around. This is a huge problem.
This is exactly the predicament I am avoiding with my interest-only mortgage which I intend to roll over into perpetuity.
HEDGEFUNDIE, do you have ANY equity in your home? I can see how your interest-only loan could work, but wouldn't you have to have some type of down payment to avoid PMI?

You idea is very interesting, assuming you could continue to keep your expenses lower than rent, or at least lower than home ownership.

Could you simply throw the house keys to the bank after the end of one of your mortgages, and boogie on down the road?

Broken Man 1999
Of course I have equity in my home. Bank would not have loaned me anything if I didn't have some skin in the game. Right now I'm at 66% LTV, that will probably go up if the recession deepens.

I really think this is a feasible alternative to renting for many people. It improves net worth diversification.

JakeyLee
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Re: Retirees: what are you doing with all the home equity?

Post by JakeyLee » Thu Apr 16, 2020 3:53 pm

I've owned my home outright for a few years now. I'm really surprised how much I enjoy it. This is the first bear market I haven't lost sleep over. I'm still going to retire in January. I'm not sure I will have to sell equities for quite a while. If someone told me that 5-10 years ago, I would not believe it.

I would never get another mortgage again. Nope... never. But the thought of selling the house, taking the $700k in cash, and driving around the country in a camper has certainly crossed my mind. :beer

eldinerocheapo
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Re: Retirees: what are you doing with all the home equity?

Post by eldinerocheapo » Thu Apr 16, 2020 4:53 pm

Nada, got too many other things to worry about.
"Do, or do not." Yoda

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Re: Retirees: what are you doing with all the home equity?

Post by adamthesmythe » Thu Apr 16, 2020 5:06 pm

22twain wrote:
Thu Apr 16, 2020 1:45 pm
Flashes1 wrote:
Thu Apr 16, 2020 11:21 am
I hope to spend all our investable assets, and leave the paid-for home (worth in the 7-figures) to our kids.
I seem to remember reading a number of threads here about disagreements among siblings about what to do with a jointly inherited home or other property. Dividing financial assets is much easier.
It CAN work out (sibling and I had the same idea, namely sell and split the cash). But the larger the number of heirs...and the more different they are...and the more they have particular but different needs for money or a place to live...the more likely is strife.

downshiftme
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Re: Retirees: what are you doing with all the home equity?

Post by downshiftme » Thu Apr 16, 2020 5:09 pm

Not retired yet, but I plan to have a fully paid off home when I do. Then I plan to simply live in it as long as I can. I am NOT planning to spend down any part of my house, but if all my other plans fall apart or some completely unexpected expense outside of my plans happens, then I will sell or reverse mortgage and use that equity as the safety net of last resort.

None of my heirs have any interest in keeping the house, so my estate will sell and split the proceeds.

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cheese_breath
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Re: Retirees: what are you doing with all the home equity?

Post by cheese_breath » Fri Apr 17, 2020 11:47 am

TravelforFun wrote:
Thu Apr 16, 2020 1:31 pm
cheese_breath wrote:
Wed Apr 15, 2020 12:36 pm
Up until DW's stoke nothing. Since then I sold the house and added the equity to the balance to pay for her care.
How big of a hassle was it for you to get the house ready, sell it, move to a new place, and adjust to the community and neighbors? I may need to do this a few years from now.

TravelforFun

I’m happy to shared my experiences, because I believe my situation is rather unique. But I don’t believe you’ll get any special revelations from them. If you have any questions after reading this I’d be happy to try to answer them.

DW’s stroke was April 2017, and I moved her to Texas by air ambulance as soon as her doctor approved it and weather permitted (April 2018). I’d done nothing to get the house ready to sell as I’d spent all my time with DW in her nursing home, including staying overnights with her. I left that up to her son who lived in Michigan.

His job wasn’t easy. DW’s mother died just a few months before her stroke, and we were still storing much of the furniture and other items from her estate in our home. Additionally DW had A LOT of stuff of her own there. She was an avid collector (to the extent of hoarding) of all things Annette Funicello and some other actresses, and the house was packed with that stuff. I’d always let it go because she was nearly home bound with other ailments even before the stroke, and that was one of the few things that made her happy. We expected to spend the rest of her lives there; I never expected to move all that stuff. And unfortunately we couldn’t. A lot got thrown out. (I’ll never tell her.) But a lot was saved and sent to Texas in PODS. There’s an 8x10 storage unit just down the road from me filled with her teddy bears, dolls and other precious collectibles that I’ve been paying rent on for two years. I doubt she’ll ever be well enough to see them, but I can’t bring myself to get rid of them while she’s still alive.

One of DW’s passions besides her collectibles was nice furniture, and we had some really nice pieces. After the house and other junk was cleared out of the house DW’s son coordinated with an estate sale company, and finally brought in a cleaning crew to get the house ready to sell.

DW also has a daughter in Texas. She’s the reason we came down here. Of DW’s three children (there’s another son) the daughter is the one most qualified to take over DW’s care if anything should happen to me. She did all the legwork investigating nursing homes and apartments so I could decide which ones I wanted before coming down. She made all the arrangements so all I had to do was sign the contracts when I got here.

There’s one other son in Arizona. His job requires a lot of overseas travel, so he wasn’t able to help out as much as the others. But he was able to get the time off to come to Michigan to travel with DW to Texas on the air ambulance while I drove down in the car. He also got some time to come back and do a lot of the manual labor in packing DW’s collectables and loading them into the PODS and throwing ‘the junk’ into the dumpsters. His other contributions were investigating the shipping options and lining up the real estate agent (one of his old high school friends).

Once the house was ready to sell, it sold fast. I priced it to sell because it been unoccupied for several months, and I was worried about it being vandalized. It passed inspection without a hitch, and we finally signed the papers in February, 2019.

I’ve lived here two years now and don’t know any of the neighbors. As I did in Michigan, I spend most of my time with DW at the nursing home, including staying overnight. (I’m currently locked out because of the Coronavirus, but I’ll be going back as soon as the lockdown is lifted.) She’s my life, and I’m not interested in any social activities outside of that. All I can say is that I moved twice when I lived with my parents and never had any trouble blending in. But they did all the investigation of the neighborhoods, not me.
The surest way to know the future is when it becomes the past.

TravelforFun
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Re: Retirees: what are you doing with all the home equity?

Post by TravelforFun » Fri Apr 17, 2020 12:14 pm

cheese_breath wrote:
Fri Apr 17, 2020 11:47 am
TravelforFun wrote:
Thu Apr 16, 2020 1:31 pm
cheese_breath wrote:
Wed Apr 15, 2020 12:36 pm
Up until DW's stoke nothing. Since then I sold the house and added the equity to the balance to pay for her care.
How big of a hassle was it for you to get the house ready, sell it, move to a new place, and adjust to the community and neighbors? I may need to do this a few years from now.

TravelforFun

I’m happy to shared my experiences, because I believe my situation is rather unique. But I don’t believe you’ll get any special revelations from them. If you have any questions after reading this I’d be happy to try to answer them.

DW’s stroke was April 2017, and I moved her to Texas by air ambulance as soon as her doctor approved it and weather permitted (April 2018). I’d done nothing to get the house ready to sell as I’d spent all my time with DW in her nursing home, including staying overnights with her. I left that up to her son who lived in Michigan.

His job wasn’t easy. DW’s mother died just a few months before her stroke, and we were still storing much of the furniture and other items from her estate in our home. Additionally DW had A LOT of stuff of her own there. She was an avid collector (to the extent of hoarding) of all things Annette Funicello and some other actresses, and the house was packed with that stuff. I’d always let it go because she was nearly home bound with other ailments even before the stroke, and that was one of the few things that made her happy. We expected to spend the rest of her lives there; I never expected to move all that stuff. And unfortunately we couldn’t. A lot got thrown out. (I’ll never tell her.) But a lot was saved and sent to Texas in PODS. There’s an 8x10 storage unit just down the road from me filled with her teddy bears, dolls and other precious collectibles that I’ve been paying rent on for two years. I doubt she’ll ever be well enough to see them, but I can’t bring myself to get rid of them while she’s still alive.

One of DW’s passions besides her collectibles was nice furniture, and we had some really nice pieces. After the house and other junk was cleared out of the house DW’s son coordinated with an estate sale company, and finally brought in a cleaning crew to get the house ready to sell.

DW also has a daughter in Texas. She’s the reason we came down here. Of DW’s three children (there’s another son) the daughter is the one most qualified to take over DW’s care if anything should happen to me. She did all the legwork investigating nursing homes and apartments so I could decide which ones I wanted before coming down. She made all the arrangements so all I had to do was sign the contracts when I got here.

There’s one other son in Arizona. His job requires a lot of overseas travel, so he wasn’t able to help out as much as the others. But he was able to get the time off to come to Michigan to travel with DW to Texas on the air ambulance while I drove down in the car. He also got some time to come back and do a lot of the manual labor in packing DW’s collectables and loading them into the PODS and throwing ‘the junk’ into the dumpsters. His other contributions were investigating the shipping options and lining up the real estate agent (one of his old high school friends).

Once the house was ready to sell, it sold fast. I priced it to sell because it been unoccupied for several months, and I was worried about it being vandalized. It passed inspection without a hitch, and we finally signed the papers in February, 2019.

I’ve lived here two years now and don’t know any of the neighbors. As I did in Michigan, I spend most of my time with DW at the nursing home, including staying overnight. (I’m currently locked out because of the Coronavirus, but I’ll be going back as soon as the lockdown is lifted.) She’s my life, and I’m not interested in any social activities outside of that. All I can say is that I moved twice when I lived with my parents and never had any trouble blending in. But they did all the investigation of the neighborhoods, not me.
Wow! Sounds like you've been through a lot the last couple of years and I'm glad you've gotten help from the kids. Thanks for sharing.

TravelforFun

Teague
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Re: Retirees: what are you doing with all the home equity?

Post by Teague » Fri Apr 17, 2020 12:19 pm

I'm not doing anything with it. Nor am I doing anything with the equity in my cars, boat, propane grill, garden shed, refrigerator contents, lawnmower, or firewood.
Semper Augustus

delamer
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Re: Retirees: what are you doing with all the home equity?

Post by delamer » Fri Apr 17, 2020 3:09 pm

cheese_breath wrote:
Fri Apr 17, 2020 11:47 am
TravelforFun wrote:
Thu Apr 16, 2020 1:31 pm
cheese_breath wrote:
Wed Apr 15, 2020 12:36 pm
Up until DW's stoke nothing. Since then I sold the house and added the equity to the balance to pay for her care.
How big of a hassle was it for you to get the house ready, sell it, move to a new place, and adjust to the community and neighbors? I may need to do this a few years from now.

TravelforFun

I’m happy to shared my experiences, because I believe my situation is rather unique. But I don’t believe you’ll get any special revelations from them. If you have any questions after reading this I’d be happy to try to answer them.

DW’s stroke was April 2017, and I moved her to Texas by air ambulance as soon as her doctor approved it and weather permitted (April 2018). I’d done nothing to get the house ready to sell as I’d spent all my time with DW in her nursing home, including staying overnights with her. I left that up to her son who lived in Michigan.

His job wasn’t easy. DW’s mother died just a few months before her stroke, and we were still storing much of the furniture and other items from her estate in our home. Additionally DW had A LOT of stuff of her own there. She was an avid collector (to the extent of hoarding) of all things Annette Funicello and some other actresses, and the house was packed with that stuff. I’d always let it go because she was nearly home bound with other ailments even before the stroke, and that was one of the few things that made her happy. We expected to spend the rest of her lives there; I never expected to move all that stuff. And unfortunately we couldn’t. A lot got thrown out. (I’ll never tell her.) But a lot was saved and sent to Texas in PODS. There’s an 8x10 storage unit just down the road from me filled with her teddy bears, dolls and other precious collectibles that I’ve been paying rent on for two years. I doubt she’ll ever be well enough to see them, but I can’t bring myself to get rid of them while she’s still alive.

One of DW’s passions besides her collectibles was nice furniture, and we had some really nice pieces. After the house and other junk was cleared out of the house DW’s son coordinated with an estate sale company, and finally brought in a cleaning crew to get the house ready to sell.

DW also has a daughter in Texas. She’s the reason we came down here. Of DW’s three children (there’s another son) the daughter is the one most qualified to take over DW’s care if anything should happen to me. She did all the legwork investigating nursing homes and apartments so I could decide which ones I wanted before coming down. She made all the arrangements so all I had to do was sign the contracts when I got here.

There’s one other son in Arizona. His job requires a lot of overseas travel, so he wasn’t able to help out as much as the others. But he was able to get the time off to come to Michigan to travel with DW to Texas on the air ambulance while I drove down in the car. He also got some time to come back and do a lot of the manual labor in packing DW’s collectables and loading them into the PODS and throwing ‘the junk’ into the dumpsters. His other contributions were investigating the shipping options and lining up the real estate agent (one of his old high school friends).

Once the house was ready to sell, it sold fast. I priced it to sell because it been unoccupied for several months, and I was worried about it being vandalized. It passed inspection without a hitch, and we finally signed the papers in February, 2019.

I’ve lived here two years now and don’t know any of the neighbors. As I did in Michigan, I spend most of my time with DW at the nursing home, including staying overnight. (I’m currently locked out because of the Coronavirus, but I’ll be going back as soon as the lockdown is lifted.) She’s my life, and I’m not interested in any social activities outside of that. All I can say is that I moved twice when I lived with my parents and never had any trouble blending in. But they did all the investigation of the neighborhoods, not me.
Thanks for sharing your story. With so many tales of family dysfunction, on this forum and elsewhere, it was wonderful to hear how yours worked together in a time of need.

I’m sorry that you aren’t able to go visit your wife for now. This pandemic is making already difficult situations even more painful.

Godot
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Re: Retirees: what are you doing with all the home equity?

Post by Godot » Fri Apr 17, 2020 3:13 pm

FIREchief wrote:
Wed Apr 15, 2020 12:37 pm
I liquidated it 100% 18 months ago and rented. I was glad I did even before this latest "crisis," and am even more glad now. That said, my heirs would likely have come out ahead if I had just stayed put for another 5, 10, 15 years but life is about more than $$$.
Firechief: Can you elaborate on why you sold house and chose to rent? I'm intrigued by the pros and cons of this decision, primarily because I'm unaware of the pros. TIA.
Estragon: I can't go on like this. | Vladimir: That's what you think. | ― Samuel Beckett, Waiting for Godot

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LilyFleur
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Re: Retirees: what are you doing with all the home equity?

Post by LilyFleur » Fri Apr 17, 2020 3:24 pm

delamer wrote:
Fri Apr 17, 2020 3:09 pm
cheese_breath wrote:
Fri Apr 17, 2020 11:47 am
TravelforFun wrote:
Thu Apr 16, 2020 1:31 pm
cheese_breath wrote:
Wed Apr 15, 2020 12:36 pm
Up until DW's stoke nothing. Since then I sold the house and added the equity to the balance to pay for her care.
How big of a hassle was it for you to get the house ready, sell it, move to a new place, and adjust to the community and neighbors? I may need to do this a few years from now.

TravelforFun

I’m happy to shared my experiences, because I believe my situation is rather unique. But I don’t believe you’ll get any special revelations from them. If you have any questions after reading this I’d be happy to try to answer them.

DW’s stroke was April 2017, and I moved her to Texas by air ambulance as soon as her doctor approved it and weather permitted (April 2018). I’d done nothing to get the house ready to sell as I’d spent all my time with DW in her nursing home, including staying overnights with her. I left that up to her son who lived in Michigan.

His job wasn’t easy. DW’s mother died just a few months before her stroke, and we were still storing much of the furniture and other items from her estate in our home. Additionally DW had A LOT of stuff of her own there. She was an avid collector (to the extent of hoarding) of all things Annette Funicello and some other actresses, and the house was packed with that stuff. I’d always let it go because she was nearly home bound with other ailments even before the stroke, and that was one of the few things that made her happy. We expected to spend the rest of her lives there; I never expected to move all that stuff. And unfortunately we couldn’t. A lot got thrown out. (I’ll never tell her.) But a lot was saved and sent to Texas in PODS. There’s an 8x10 storage unit just down the road from me filled with her teddy bears, dolls and other precious collectibles that I’ve been paying rent on for two years. I doubt she’ll ever be well enough to see them, but I can’t bring myself to get rid of them while she’s still alive.

One of DW’s passions besides her collectibles was nice furniture, and we had some really nice pieces. After the house and other junk was cleared out of the house DW’s son coordinated with an estate sale company, and finally brought in a cleaning crew to get the house ready to sell.

DW also has a daughter in Texas. She’s the reason we came down here. Of DW’s three children (there’s another son) the daughter is the one most qualified to take over DW’s care if anything should happen to me. She did all the legwork investigating nursing homes and apartments so I could decide which ones I wanted before coming down. She made all the arrangements so all I had to do was sign the contracts when I got here.

There’s one other son in Arizona. His job requires a lot of overseas travel, so he wasn’t able to help out as much as the others. But he was able to get the time off to come to Michigan to travel with DW to Texas on the air ambulance while I drove down in the car. He also got some time to come back and do a lot of the manual labor in packing DW’s collectables and loading them into the PODS and throwing ‘the junk’ into the dumpsters. His other contributions were investigating the shipping options and lining up the real estate agent (one of his old high school friends).

Once the house was ready to sell, it sold fast. I priced it to sell because it been unoccupied for several months, and I was worried about it being vandalized. It passed inspection without a hitch, and we finally signed the papers in February, 2019.

I’ve lived here two years now and don’t know any of the neighbors. As I did in Michigan, I spend most of my time with DW at the nursing home, including staying overnight. (I’m currently locked out because of the Coronavirus, but I’ll be going back as soon as the lockdown is lifted.) She’s my life, and I’m not interested in any social activities outside of that. All I can say is that I moved twice when I lived with my parents and never had any trouble blending in. But they did all the investigation of the neighborhoods, not me.
Thanks for sharing your story. With so many tales of family dysfunction, on this forum and elsewhere, it was wonderful to hear how yours worked together in a time of need.

I’m sorry that you aren’t able to go visit your wife for now. This pandemic is making already difficult situations even more painful.
What a wonderful husband you are... and it seems that the children have rallied to help as well. Thanks for sharing your situation with us--you are inspiring...

HEDGEFUNDIE
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Re: Retirees: what are you doing with all the home equity?

Post by HEDGEFUNDIE » Fri Apr 17, 2020 3:25 pm

Teague wrote:
Fri Apr 17, 2020 12:19 pm
I'm not doing anything with it. Nor am I doing anything with the equity in my cars, boat, propane grill, garden shed, refrigerator contents, lawnmower, or firewood.
If the equity in your material possessions summed up to over a million dollars and well over half your net worth, you may change your mind.

hudson
Posts: 2888
Joined: Fri Apr 06, 2007 9:15 am

Re: 4 options

Post by hudson » Fri Apr 17, 2020 3:49 pm

sergeant wrote:
Thu Apr 16, 2020 1:32 pm
I could make my children joint owners, but the will takes care of that.
Don't make them joint owners they will lose the step up in basis upon your death.
[/quote]
Thanks Sergeant! You are exactly right!

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FIREchief
Posts: 4592
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Re: Retirees: what are you doing with all the home equity?

Post by FIREchief » Fri Apr 17, 2020 4:06 pm

Godot wrote:
Fri Apr 17, 2020 3:13 pm
FIREchief wrote:
Wed Apr 15, 2020 12:37 pm
I liquidated it 100% 18 months ago and rented. I was glad I did even before this latest "crisis," and am even more glad now. That said, my heirs would likely have come out ahead if I had just stayed put for another 5, 10, 15 years but life is about more than $$$.
Firechief: Can you elaborate on why you sold house and chose to rent? I'm intrigued by the pros and cons of this decision, primarily because I'm unaware of the pros. TIA.
Absolutely! I even started a thread on my move back at the time:

viewtopic.php?f=2&t=262071

The key pro is that I don't have to "manage" a property any more. As any honest person who has owned a home will readily admit, with a house it is always something. It gives me great pleasure to now drive around my town and see all those trucks from plumbers, roofers, termite treatment, etc. driving to and fro helping out poor homeowners who woke up to "the next challenge" this morning. Even scarier (used to be) are those trucks from those emergency response places that respond when there is a flood, fire, etc. in a home. Beyond that normal background noise, we were at the cusp of one of the scariest words in our vocabulary: "REMODEL" We moved into a new construction apartment complex where everything is already new/remodeled and I can just "call the guy" 24/7 if I need maintenance support. Our two maintenance guys are a pleasure to work with and I'm on a first name basis with each. Life is good!

Beyond that, downsizing is a scary/healthy/tough/rewarding journey. I'll refer you to the linked thread for a lot of great comments and discussion. :sharebeer
I am not a lawyer, accountant or financial advisor. Any advice or suggestions that I may provide shall be considered for entertainment purposes only.

likegarden
Posts: 3001
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Re: Retirees: what are you doing with all the home equity?

Post by likegarden » Fri Apr 17, 2020 4:21 pm

We put it into a irrevocable trust, benefiting our son and grandson.

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cheese_breath
Posts: 9567
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Re: Retirees: what are you doing with all the home equity?

Post by cheese_breath » Fri Apr 17, 2020 4:27 pm

delamer wrote:
Fri Apr 17, 2020 3:09 pm
cheese_breath wrote:
Fri Apr 17, 2020 11:47 am
TravelforFun wrote:
Thu Apr 16, 2020 1:31 pm
cheese_breath wrote:
Wed Apr 15, 2020 12:36 pm
Up until DW's stoke nothing. Since then I sold the house and added the equity to the balance to pay for her care.
How big of a hassle was it for you to get the house ready, sell it, move to a new place, and adjust to the community and neighbors? I may need to do this a few years from now.

TravelforFun

I’m happy to shared my experiences, because I believe my situation is rather unique. But I don’t believe you’ll get any special revelations from them. If you have any questions after reading this I’d be happy to try to answer them.

DW’s stroke was April 2017, and I moved her to Texas by air ambulance as soon as her doctor approved it and weather permitted (April 2018). I’d done nothing to get the house ready to sell as I’d spent all my time with DW in her nursing home, including staying overnights with her. I left that up to her son who lived in Michigan.

His job wasn’t easy. DW’s mother died just a few months before her stroke, and we were still storing much of the furniture and other items from her estate in our home. Additionally DW had A LOT of stuff of her own there. She was an avid collector (to the extent of hoarding) of all things Annette Funicello and some other actresses, and the house was packed with that stuff. I’d always let it go because she was nearly home bound with other ailments even before the stroke, and that was one of the few things that made her happy. We expected to spend the rest of her lives there; I never expected to move all that stuff. And unfortunately we couldn’t. A lot got thrown out. (I’ll never tell her.) But a lot was saved and sent to Texas in PODS. There’s an 8x10 storage unit just down the road from me filled with her teddy bears, dolls and other precious collectibles that I’ve been paying rent on for two years. I doubt she’ll ever be well enough to see them, but I can’t bring myself to get rid of them while she’s still alive.

One of DW’s passions besides her collectibles was nice furniture, and we had some really nice pieces. After the house and other junk was cleared out of the house DW’s son coordinated with an estate sale company, and finally brought in a cleaning crew to get the house ready to sell.

DW also has a daughter in Texas. She’s the reason we came down here. Of DW’s three children (there’s another son) the daughter is the one most qualified to take over DW’s care if anything should happen to me. She did all the legwork investigating nursing homes and apartments so I could decide which ones I wanted before coming down. She made all the arrangements so all I had to do was sign the contracts when I got here.

There’s one other son in Arizona. His job requires a lot of overseas travel, so he wasn’t able to help out as much as the others. But he was able to get the time off to come to Michigan to travel with DW to Texas on the air ambulance while I drove down in the car. He also got some time to come back and do a lot of the manual labor in packing DW’s collectables and loading them into the PODS and throwing ‘the junk’ into the dumpsters. His other contributions were investigating the shipping options and lining up the real estate agent (one of his old high school friends).

Once the house was ready to sell, it sold fast. I priced it to sell because it been unoccupied for several months, and I was worried about it being vandalized. It passed inspection without a hitch, and we finally signed the papers in February, 2019.

I’ve lived here two years now and don’t know any of the neighbors. As I did in Michigan, I spend most of my time with DW at the nursing home, including staying overnight. (I’m currently locked out because of the Coronavirus, but I’ll be going back as soon as the lockdown is lifted.) She’s my life, and I’m not interested in any social activities outside of that. All I can say is that I moved twice when I lived with my parents and never had any trouble blending in. But they did all the investigation of the neighborhoods, not me.
Thanks for sharing your story. With so many tales of family dysfunction, on this forum and elsewhere, it was wonderful to hear how yours worked together in a time of need.

I’m sorry that you aren’t able to go visit your wife for now. This pandemic is making already difficult situations even more painful.
Yeah, they get along pretty good for siblings.

It's tough not being able to be there, but with the tight lockdown I know she's in the safest place she could be right now.
The surest way to know the future is when it becomes the past.

InvestingGeek
Posts: 314
Joined: Tue Aug 28, 2018 6:31 am

Re: Retirees: what are you doing with all the home equity?

Post by InvestingGeek » Fri Apr 17, 2020 4:37 pm

HEDGEFUNDIE wrote:
Thu Apr 16, 2020 8:58 am
slowbutsteady wrote:
Thu Apr 16, 2020 6:04 am
HEDGEFUNDIE wrote:
Wed Apr 15, 2020 6:57 pm
yangtui wrote:
Wed Apr 15, 2020 6:43 pm
HEDGEFUNDIE wrote:
Wed Apr 15, 2020 1:14 pm

This is exactly the predicament I am avoiding with my interest-only mortgage which I intend to roll over into perpetuity.
I need to model this out in Excel but on the surface interest-only mortgages seem like a good deal. For the average person they are probably bad but if you approach it the right way they seem to be a very powerful tool. Any general pointers or references you like regarding interest only mortgages?
Conceptually:

The value of an interest only mortgage =
the value of liquidity of the principal diverted to investment portfolio +
portfolio market return on that principal -
interest rate of the mortgage

"Value of liquidity" incorporates the volatility of the investment portfolio, the higher the volatility, the less likely the money will be there when you need it.

To each his/her own, but isn't the interest + maintenance cost more expensive than renting? Of course that's assuming comparable home exists.
In my area it’s cheaper than renting. Especially with interest rates at under 3%
Intriguing idea. But low volatility on principal suggests low return. Given the environment we're in, wouldn't paying it off be a better return (home equity being practically dead money notwithstanding)?

cherijoh
Posts: 6590
Joined: Tue Feb 20, 2007 4:49 pm
Location: Charlotte NC

Re: Retirees: what are you doing with all the home equity?

Post by cherijoh » Fri Apr 17, 2020 4:41 pm

HEDGEFUNDIE wrote:
Wed Apr 15, 2020 12:16 pm
ochotona wrote:
Wed Apr 15, 2020 12:06 pm
Sadly, my MIL has stated that much of her wealth is in her house. She's house rich, cash poor. Sadly, if there are no buyers, she's poor all the way around. This is a huge problem.
This is exactly the predicament I am avoiding with my interest-only mortgage which I intend to roll over into perpetuity.
You better hope we never have a return to interest rates like those we had in the early 80s. My initial mortgage in 1982 was north of 14%! :shock:

Beehave
Posts: 727
Joined: Mon Jun 19, 2017 12:46 pm

Re: Retirees: what are you doing with all the home equity?

Post by Beehave » Fri Apr 17, 2020 4:46 pm

I'm retired and believe in holding diverse assets. When it comes to debt-as-an-asset, I'd rather own stocks of companies that owe money than to owe money myself. I'd rather let the managers of the diverse companies I "own" via my holding of broad index funds do the heavy lifting of figuring out how to optimize debt than to take on that load, worry, and direct risk myself.

HEDGEFUNDIE
Posts: 4801
Joined: Sun Oct 22, 2017 2:06 pm

Re: Retirees: what are you doing with all the home equity?

Post by HEDGEFUNDIE » Fri Apr 17, 2020 7:38 pm

cherijoh wrote:
Fri Apr 17, 2020 4:41 pm
HEDGEFUNDIE wrote:
Wed Apr 15, 2020 12:16 pm
ochotona wrote:
Wed Apr 15, 2020 12:06 pm
Sadly, my MIL has stated that much of her wealth is in her house. She's house rich, cash poor. Sadly, if there are no buyers, she's poor all the way around. This is a huge problem.
This is exactly the predicament I am avoiding with my interest-only mortgage which I intend to roll over into perpetuity.
You better hope we never have a return to interest rates like those we had in the early 80s. My initial mortgage in 1982 was north of 14%! :shock:
What were savings accounts paying at the time?

Teague
Posts: 1994
Joined: Wed Nov 04, 2015 6:15 pm

Re: Retirees: what are you doing with all the home equity?

Post by Teague » Fri Apr 17, 2020 7:47 pm

HEDGEFUNDIE wrote:
Fri Apr 17, 2020 3:25 pm
Teague wrote:
Fri Apr 17, 2020 12:19 pm
I'm not doing anything with it. Nor am I doing anything with the equity in my cars, boat, propane grill, garden shed, refrigerator contents, lawnmower, or firewood.
If the equity in your material possessions summed up to over a million dollars and well over half your net worth, you may change your mind.
Actually I don't think I would. Why would I?
Semper Augustus

delamer
Posts: 10133
Joined: Tue Feb 08, 2011 6:13 pm

Re: Retirees: what are you doing with all the home equity?

Post by delamer » Fri Apr 17, 2020 10:10 pm

HEDGEFUNDIE wrote:
Fri Apr 17, 2020 7:38 pm
cherijoh wrote:
Fri Apr 17, 2020 4:41 pm
HEDGEFUNDIE wrote:
Wed Apr 15, 2020 12:16 pm
ochotona wrote:
Wed Apr 15, 2020 12:06 pm
Sadly, my MIL has stated that much of her wealth is in her house. She's house rich, cash poor. Sadly, if there are no buyers, she's poor all the way around. This is a huge problem.
This is exactly the predicament I am avoiding with my interest-only mortgage which I intend to roll over into perpetuity.
You better hope we never have a return to interest rates like those we had in the early 80s. My initial mortgage in 1982 was north of 14%! :shock:
What were savings accounts paying at the time?
I had a mortgage at 12.75% and a one-year CD at 11%.

Luckywon
Posts: 947
Joined: Tue Mar 28, 2017 10:33 am

Re: Retirees: what are you doing with all the home equity?

Post by Luckywon » Fri Apr 17, 2020 10:18 pm

cheese_breath wrote:
Fri Apr 17, 2020 11:47 am
TravelforFun wrote:
Thu Apr 16, 2020 1:31 pm
cheese_breath wrote:
Wed Apr 15, 2020 12:36 pm
Up until DW's stoke nothing. Since then I sold the house and added the equity to the balance to pay for her care.
How big of a hassle was it for you to get the house ready, sell it, move to a new place, and adjust to the community and neighbors? I may need to do this a few years from now.

TravelforFun

I’m happy to shared my experiences, because I believe my situation is rather unique. But I don’t believe you’ll get any special revelations from them. If you have any questions after reading this I’d be happy to try to answer them.

DW’s stroke was April 2017, and I moved her to Texas by air ambulance as soon as her doctor approved it and weather permitted (April 2018). I’d done nothing to get the house ready to sell as I’d spent all my time with DW in her nursing home, including staying overnights with her. I left that up to her son who lived in Michigan.

His job wasn’t easy. DW’s mother died just a few months before her stroke, and we were still storing much of the furniture and other items from her estate in our home. Additionally DW had A LOT of stuff of her own there. She was an avid collector (to the extent of hoarding) of all things Annette Funicello and some other actresses, and the house was packed with that stuff. I’d always let it go because she was nearly home bound with other ailments even before the stroke, and that was one of the few things that made her happy. We expected to spend the rest of her lives there; I never expected to move all that stuff. And unfortunately we couldn’t. A lot got thrown out. (I’ll never tell her.) But a lot was saved and sent to Texas in PODS. There’s an 8x10 storage unit just down the road from me filled with her teddy bears, dolls and other precious collectibles that I’ve been paying rent on for two years. I doubt she’ll ever be well enough to see them, but I can’t bring myself to get rid of them while she’s still alive.

One of DW’s passions besides her collectibles was nice furniture, and we had some really nice pieces. After the house and other junk was cleared out of the house DW’s son coordinated with an estate sale company, and finally brought in a cleaning crew to get the house ready to sell.

DW also has a daughter in Texas. She’s the reason we came down here. Of DW’s three children (there’s another son) the daughter is the one most qualified to take over DW’s care if anything should happen to me. She did all the legwork investigating nursing homes and apartments so I could decide which ones I wanted before coming down. She made all the arrangements so all I had to do was sign the contracts when I got here.

There’s one other son in Arizona. His job requires a lot of overseas travel, so he wasn’t able to help out as much as the others. But he was able to get the time off to come to Michigan to travel with DW to Texas on the air ambulance while I drove down in the car. He also got some time to come back and do a lot of the manual labor in packing DW’s collectables and loading them into the PODS and throwing ‘the junk’ into the dumpsters. His other contributions were investigating the shipping options and lining up the real estate agent (one of his old high school friends).

Once the house was ready to sell, it sold fast. I priced it to sell because it been unoccupied for several months, and I was worried about it being vandalized. It passed inspection without a hitch, and we finally signed the papers in February, 2019.

I’ve lived here two years now and don’t know any of the neighbors. As I did in Michigan, I spend most of my time with DW at the nursing home, including staying overnight. (I’m currently locked out because of the Coronavirus, but I’ll be going back as soon as the lockdown is lifted.) She’s my life, and I’m not interested in any social activities outside of that. All I can say is that I moved twice when I lived with my parents and never had any trouble blending in. But they did all the investigation of the neighborhoods, not me.
Your devotion and perseverance are an inspiration. Thanks for sharing this.

Luckywon
Posts: 947
Joined: Tue Mar 28, 2017 10:33 am

Re: Retirees: what are you doing with all the home equity?

Post by Luckywon » Fri Apr 17, 2020 10:22 pm

I don't think it will ever make financial sense for me to sell my home, because of capital gains taxes that would be due. My heirs will appreciate the step up in basis.

HEDGEFUNDIE
Posts: 4801
Joined: Sun Oct 22, 2017 2:06 pm

Re: Retirees: what are you doing with all the home equity?

Post by HEDGEFUNDIE » Fri Apr 17, 2020 11:58 pm

delamer wrote:
Fri Apr 17, 2020 10:10 pm
HEDGEFUNDIE wrote:
Fri Apr 17, 2020 7:38 pm
cherijoh wrote:
Fri Apr 17, 2020 4:41 pm
HEDGEFUNDIE wrote:
Wed Apr 15, 2020 12:16 pm
ochotona wrote:
Wed Apr 15, 2020 12:06 pm
Sadly, my MIL has stated that much of her wealth is in her house. She's house rich, cash poor. Sadly, if there are no buyers, she's poor all the way around. This is a huge problem.
This is exactly the predicament I am avoiding with my interest-only mortgage which I intend to roll over into perpetuity.
You better hope we never have a return to interest rates like those we had in the early 80s. My initial mortgage in 1982 was north of 14%! :shock:
What were savings accounts paying at the time?
I had a mortgage at 12.75% and a one-year CD at 11%.
Exactly my point

User avatar
peetsperk
Posts: 254
Joined: Wed Feb 04, 2015 4:02 pm

Re: Retirees: what are you doing with all the home equity?

Post by peetsperk » Sat Apr 18, 2020 12:17 am

Have not done anything differently. House is paid for. Retired in July 2020. Have never included the value of our house in any retirement calculations. Would never want to borrow against it unless we were in dire circumstances.

heyyou
Posts: 3702
Joined: Tue Feb 20, 2007 4:58 pm

Re: Retirees: what are you doing with all the home equity?

Post by heyyou » Sat Apr 18, 2020 12:36 am

Sold the multi-story immediately after having the little retirement house built, paying for it as we went along. We could then retire with the previous home's equity in our portfolio. Retirement is far better than any other use of that money.

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Topic Author
tennisplyr
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Location: Sarasota, FL

Re: Retirees: what are you doing with all the home equity?

Post by tennisplyr » Sat Apr 18, 2020 3:45 pm

HEDGEFUNDIE wrote:
Fri Apr 17, 2020 3:25 pm
Teague wrote:
Fri Apr 17, 2020 12:19 pm
I'm not doing anything with it. Nor am I doing anything with the equity in my cars, boat, propane grill, garden shed, refrigerator contents, lawnmower, or firewood.
If the equity in your material possessions summed up to over a million dollars and well over half your net worth, you may change your mind.
My home equity is roughly 1/3 of net worth...think I'm going to sit tight a bit. Maybe get a HELOC, or later on, a reverse mortgage.
Those who move forward with a happy spirit will find that things always work out.

tibbitts
Posts: 10685
Joined: Tue Feb 27, 2007 6:50 pm

Re: 4 options

Post by tibbitts » Sat Apr 18, 2020 3:51 pm

hudson wrote:
Wed Apr 15, 2020 5:47 pm
I see 4 options...do nothing, sell and rent, heloc, or reverse mortgage.
I don't have a mortgage and don't want any debt, so that leaves out a heloc or a reverse mortgage.
I did look at a reverse mortgage to see what it was about. From memory, one only got around half of the value of the house....a terrible deal. UPDATE: I ran lending tree's calculator for age 67, $400K house...payout...190K.
Sell and rent....UGH!
Only "do nothing" appeals to me.
I could make my children joint owners, but the will takes care of that.
I don't think the will takes care of it, it's too messy. Transfer on death is better. But Florida and a handful of states won't let you do that - and Ladybird deeds are defintely not the same thing. I just don't understand what the issue is - why these states are being so stubborn. Anyone know?

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