Staging is so important! Totally agree. I have a friend who is an artist that can give a critical eye. Also at the time we are wanting to sell, will pick up what is being looked for with current accent type things, introducing eye appeal/color. DH and I can live in a staged house, with clearing out many things for whatever our planned relocation is. I have two original paintings (one is DD2’s when she has a larger place/place to hang it).
Many buyers out there want a ‘white’ kitchen. Hate to do the cabinet refinish only to have someone paint them white! My parents had some cherry wood areas in their former kitchen, and the new owner wallpapered over it.
The four season room will be very reasonable to build $/sq ft, while the bump up in sq footage for the overall home is important in getting to a different class of homes (which ours is as custom built). Some of the lower sq footage homes (up to 2800 sq ft) may have only one HVAC, which typically is not the best for overall comfort in various areas (upstairs and downstairs). In the south, in our area, you are usually on a slab or a raised area (with crawl space) - our crawl space is actually very generous, as the city moved where our septic tank could go and we had 3 additional rows of block. So much better for all of home, but of course is more expensive than slab.
DH is not on board yet on the room addition and carport, but once I have the architect plans and costs, and general realtor input, I believe the numbers will speak to him. Typically I do a lot of the ‘up front work’, and DH gets enthusiastic with his love of workshop projects and generally with building.
OMG - no $200K project; not 1/10th of that but probably under $40K. And I do think that we may be able to negotiate the realtor fee. In the early 1990’s, we did sell a home in this general area FSBO. We do have people who have expressed interest in our home, and will see at the time we want to sell what the best strategy for us will be. I suspect we will use a realtor - the one gal from my book club - she is part of a ‘realty’ team; I also know about 15 realtors personally in our general area.
Adding a carport plus additional square footage for 40K, that sounds extraordinarily inexpensive. You would be fortunate, I’m sure that would easily surpass 200K in my area.
Here’s my prediction. Your husband gets excited about the project, sees the potential for what he can do with an extra carport and four season room, your house turns into what you and he always wanted……you aren’t leaving. Not that there’s anything wrong with that, but liking where you live, having reasons to stay, fixing your house up to perfection, the older you get, the harder it is to move, you’re staying.
Interesting perspective, that we would be competing with the second-home market in NH. We will not have a second home in retirement. Partly it’s financial and partly because I have no interest. If I want to get away I’ll rent someone else’s place. My parents had a second home in Florida and it turned into an expensive pain and a trap. Although MA looks on paper to be more expensive than NH, it may actually be better for us. I look at Amesbury, Newburyport. I would like to be on a train line. We probably will not need public services but you never know, and I do want to be within 1 hour of high-quality specialized medical care. I am used to living in a high-tax, high-bureaucracy state and I don’t think MA is worse than NJ in that regard.
The pull of the grandkids; once he loses interest in his hobby/area involvement (which we may be at our home a long time anyway). At some point, we will need to move to live simpler.
The room addition will cost at or above $40k. IDK what the carport will cost. Will have a cost estimate on the architect fee and go from there. Project wise, it will be good to do the room and the carport at the same time - take 401k money out over 2024 and 2025 for the pot of money.
I am ‘stuck’ for a few years at least in this home (and enjoy it while here), maybe 5, maybe 10. Our 401k is very healthy. IMHO the house is not going to fail to appreciate or gain value from the improvements we decide to do. Real estate is a small part of our overall portfolio.
When do you feel that you have enough? I know intellectually that the amount I have would be considered vastly more than enough by most people. . We have no mortgage. It’s a middle of the road house in a nice suburb in a fairly HCOL area but in any event our house is only about 5 percent of our net worth. We drive middle of the road cars ( Honda) I loathe travel but also cold weather so our one big expense is snowbirding in January-February which costs about what many people spend on one nice vacation. But still I worry about retirement. How do you wrap your mind around stopping having income from work? It just seems scary. Which I know is insane. Did anyone else have trouble coming to terms with it v
I had some trouble initially. It’s tough to go from saver mode to spend-down mode. However, we have a financial advisor we trust. We have been drawing down for four years, and I feel very comfortable that we’re on the right track. We should be able to wait until 70 to draw SS, but we can always begin to draw earlier if necessary.
A lot of people feel comfortable handling their own finances, rather than paying an advisor. There is a website called Bogleheads, and you can learn a ton on it. On that site, it’s usually suggested that you have 25 times your annual expenses prior to retirement (if you have a pension, that figures in). The key is to figure out how much you need annually. I like the Firecalc website to run scenarios (you can add in SS, pensions, etc).
We thought we’d need a certain amount annually in retirement (don’t forget to add in taxes) - it turned out that we actually needed only 85% of what we thought we’d need. We also have money readily available in savings account in case something comes up.
If your HCOL area home only represents 5% of your total net worth, I am guessing that you have more than enough to retire, unless you have some significant expenses that most people do not. (Need to support aged parents, disabled child, etc)
Yes I think you must be in very good shape. Most people have their house as their primary asset. Our house is worth about 700K and no way is it only 5% of our net worth. So you should feel good!
I mean intellectually I know we are in great shape. But I just am having trouble with it emotionally. I am well aware this is kind of crazy. But also good advice from @kelsmom. Appreciate it!
Leaving paid work is scary because you are throwing your trust on systems rather than your individual efforts. If the systems fail, there will be widespread societal chaos in that case and even if you are working, it will not be great. I am also somewhat scared but I think that if we are screwed, then everyone will be screwed and it’s Mad Max territory here. There is nothing we can do about societal collapse. Our FA told us that we can have a “middle class standard of living” in retirement and that is okay with me. I want to live in a safe neighborhood and I want to have good healthcare. I can figure out how to fill my days happily without a huge consumption budget. I would like to leave some money in an estate and I don’t want to be a financial burden on my daughter. If everything goes to hell it won’t matter anyway.
My financial planner says people who think like you do are the ones who will be just fine. He worries about the clients who start with far less and spend freely without a care in the world regardless of what is happening in the economy or markets.
We are preparing to retire this year and definitely have some apprehension. It’s hard when there isn’t one magic number to tell you that you have enough, guaranteed.
We never figured real estate into retirement assets. You have to have a roof over your head; the fact that a house has resale value is meaningless while you live in it, and you always have to have a place to live somewhere. So, we didn’t include the value of any property in our financial plan.
The only thing that mattered to us was having enough in the investment portfolio to throw off, at 2-3% inflation-adjusted annually, enough to live off of comfortably for at least 35 years. We worked two years beyond that number and had no trouble turning off the earning spigot. As I posted on the Have You made It thread, drawing from that hard-earned pile is why we built it in the first place, that’s what it’s there for, so no concern about using it as it was meant to be used. It’s funding the life we planned for this last stage of our lives, and we are enjoying it anxiety free.
This is our calculus as well. We don’t have a crystal ball but, barring an apocalypse, we’re all set. Should Armageddon occur, we’ll all screwed, and no amount of planning or hard work will save us, so we don’t waste time worrying about that scenario.
I received my last paycheck for a while, maybe forever, on Thursday. There was nothing to be gained by continuing to work other than a slightly increased SS benefit. It was a lot of stress working for a nutcase. I wouldn’t have had to worry about having enough because I would be dead! Did I plan this all out? No. I met with my planner on Friday and set up distributions from a bene IRA and did some Roth conversions for 2023. I trust her and know she has my best interests at heart. If there’s a societal collapse, we’re all going to be in the same boat. I’ve been poor before and I’m not going to worry about it. Worrying about it is like paying interest on money you never borrowed.
I was in a similar situation, and it definitely helps with the decision. Since retiring, I’ve lost weight and feel so much better. I was fortunate to be able to make that choice.
Not that there’s anything wrong with that, but liking where you live, having reasons to stay, fixing your house up to perfection, the older you get, the harder it is to move, you’re staying.