"I would consider a home because that housing line item in your budget is going to be the most expensive and it will continue to go up. For a retiree on a fixed income, rising rent is one of the most dangerous variables in a financial plan."
"A homeowner with a fixed-rate mortgage locks in a fixed payment and keeps that cost stable through retirement. At 58, Karen has roughly seven to nine years before a typical retirement window."
"Cruze suggested she could have a condo paid off in 7, 8 years. That timeline is plausible if she buys at the lower end of her target range, makes a meaningful down payment, and applies extra principal payments consistently."
Karen, a 58-year-old nurse, is considering whether to buy a condo or focus on retirement savings. With $230,000 saved and a potential inheritance of $350,000, Rachel Cruze advises her to pursue both options. She emphasizes the importance of homeownership to mitigate rising housing costs, which can significantly impact retirees on fixed incomes. By purchasing a condo and paying it off before retirement, Karen can eliminate housing expenses, allowing her portfolio to generate less monthly income. Cruze also recommends contributing 15% to retirement savings while saving for a down payment.
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