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Should I Liquidate my Assets to Pay for my Retirement?

You have worked hard for most of your life and built up a substantial property portfolio with the aim of using it to somehow fund your retirement.

However, you are aging and struggling to keep up with the maintenance of your property and now you are wondering if it’s worth it to liquidate your assets and move into an easy to maintain lock-up-and-go or perhaps you are considering moving into a retirement community.

The question you are asking is “should I liquidate my assets to pay for my retirement?”

In this article, our financial advisors take a look at when and how is the best way to sell your property so that you can retire comfortably.

selling house to fund retirement

Benefits of Selling Your Home Before Retirement

Improve Cash Flow

Saving enough money for retirement is a challenging task and our worst enemy is inflation. What you save today may very well be half its worth by the time you retire. Unless you earn an above average salary with a company who offers generous pension subsidization, the chances that you will save enough money to retire comfortably while maintaining your current lifestyle are sadly low. Many people have to drastically cut back on their spending when they retire to ensure they have enough money to cover the basics.

However, selling your home (especially if it’s paid off) gives you the liquid cash you need to not only retire, but to retire with enough capital to still live a full life for your remaining years. The peace of mind and sense of security that come with this can be invaluable. With extra cash in the bank, you will also have the means to cover unexpected costs such as medical treatment or other emergencies, without having to depend on your family to help you out.

Downsizing Saves You Money

Big houses are expensive to maintain especially as we get older. Although some people are physically able to do maintenance and repair work on a large home or property, others may not have that luxury, and this is when downsizing is a good idea. However, even those who are fit and strong can still benefit from downsizing as this means they will have extra cash and more free time to enjoy their retirement.

Overall Financial Benefits

Not everyone is debt-free by the time they retire. Life is expensive and credit can sometimes offer a lifeline to those who need it. However, having debt when you retire can seriously weigh you down and steal your much-needed capital.

Selling your home can help you pay off your debts and can provide a substantial boost to your current retirement savings, allowing you to clear your name and retire peacefully.

The liquid cash you obtain from selling your home can also be used to invest smartly in other vehicles that can further supplement your monthly income throughout your retirement.

Olemera Financial Services – Retirement Planning and Financial Advisors in Johannesburg

Although there are obvious benefits to selling your home to fund a comfortable retirement, it may not be the best option for you – it depends on your situation. Furthermore, there are several factors to consider such as the current property market as well as what options you have available to you after selling your home.

If you are unsure if selling your home is the right move, or if you would like to know more about when and how to do it, please don’t hesitate to contact our financial advisors in Johannesburg.

We offer a full range of financial planning services including retirement planning and personal financial planning and we can help you build a stable financial future for you and your family.

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