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Empty Nesters: Move or Stay Put?

Do your homework before deciding where to live in retirement. These tips can help

By Anita Slomski

LET THAT COUPLE DOWN THE BLOCK relocate to Florida. Downsize? Not on your life. Retirement community? Consider that idea officially retired. You're staying right where you are. The kids may have moved out—but that doesn't mean you have to.

For many people, a longtime home represents staying connected to the things they love. In fact, among retired people who don't plan on moving, 54% cite loving their homes as the main reason for staying put, according to Home in Retirement: More Freedom, New Choices, a 2015 Merrill Lynch survey conducted in partnership with Age Wave.

It's easy to understand why older Americans might reject the notion of relocating or downsizing as they age. But the decision to stay put raises some inevitable questions. Could taking care of more home than you need eventually become a burden for you? What about your kids—will they worry about you living alone as you grow older?

Here are some suggestions to help you make this important decision.

Think ahead. "It's best to talk openly about the pros and cons of staying in your house, and the extra responsibilities it may mean for family and friends," advises Missy Spickler, a Merrill Lynch Financial Advisor. Be honest with yourself. "If you do have to make modifications to your house at some point, how will you pay for them? What if you suddenly become ill?"

Planning ahead, she says, can help you stay in control of your future.  

Don't forget that homes age along with their occupants. A house that falls into disrepair could become downright unsafe.

Budget for home improvements.  Don't forget that homes age along with their occupants. A house that falls into disrepair may be more difficult to live in or could even become downright unsafe. A backlog of repairs and maintenance could also affect the value of the house.

In addition to upkeep, the house may need to be remodeled to accommodate changing physical needs. "When my mom had a stroke, my sister and I were very worried about how she and my dad  would manage in their big, old house," says Josh Lerman, an editor who lives in the New York City area.

"I thought they'd be happier and have more freedom at an assisted living facility. But my dad arranged what he calls 'assisted living at home.' They installed a stair lift, they buy prepared meals from a local chef, and they hired an assistant to help with laundry, cooking and errands.

"We still worry," says Lerman. "But we know they're happy in their own home, and my dad has done what's needed so they can stay there."

To cover the cost of renovation and home maintenance, Spickler suggests bolstering your income from Social Security, retirement accounts and pensions with investments that could generate steady income, such as bonds and dividend-paying stocks. "That way you may not be forced to sell off long-term assets in an emergency."

"It's also a good idea to consider setting up a line of credit, backed by your home or your investments," says Merrill Lynch Banking Advisor Satish Peters. "Either could help cover the cost of any home improvements you may need and could serve as a financial bridge in an emergency."

Anticipate future health-care needs. Get to know what services are available in your community before you need them, urges Ken Smith, senior research scholar and director of the Mobility Division at the Stanford Center on Longevity. "You may someday require assistance to help you stay independent."

Newer technology is a powerful tool, as well, to help you age safely in your home. According to the Merrill Lynch/Age Wave survey, six in 10 retirees are interested in technologies such as cleaning robots, heated driveways, and innovations that could allow them to monitor their health at home.

Involve the whole family. Ultimately, the decision to stay in the home you love isn't yours alone. "Your children will be affected by your choice, so share your desires and concerns with them, and listen to what they have to say," says Debra Greenberg, Director, Personal Retirement Strategy and Solutions at Bank of America Merrill Lynch.

Greenberg recommends that you periodically run through a checklist of "what-ifs" to make sure that you're still comfortable with your decision to stay put.

Planning ahead while you're still young and active can help you enjoy retirement to its fullest—in the home you fell in love with years ago.

3 Questions to Ask Your Advisor

  1. How might I pay for home renovations if I don't want to dip into my assets?
  2. What types of insurance should I consider?
  3. Can you help us organize a family meeting with our children to discuss where and how we want to live in retirement?

Connect with an advisor and start a conversation about your goals.

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This material should be regarded as general information on healthcare considerations and is not intended to provide specific healthcare advice. If you have questions regarding your particular situation, please contact your legal or tax advisor.

Any opinions expressed herein are given in good faith, are subject to change without notice.

Bank of America Merrill Lynch is a brand name used by several Bank of America Corporation businesses, including,  but not limited  to, Retirement and Philanthropic  Services.

Bank of America Corporation is a financial  holding company that, through its subsidiaries  and affiliated  companies, provides banking and nonbanking financial  services. 

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