What Better Time

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Gray Easterling
Gray Easterling

Low interest rates make the prospect of remodeling your home more feasible. If you are retired or approaching retirement, the time and energy needed to focus on such an important project may now be available when it wasn’t prior to retirement. Not only should you have the time to monitor the project, but you will also be able to properly plan for the work. The July, 2016 Wealth Management magazine had several insights I will share with you. If you need to be in a home that is more adapted to an aging family, it may be less costly to make appropriate changes in your existing home than to buy a new model. You retain your neighbors and have already marked your territory. No need to adapt to new surroundings unless you are not happy in your current digs. Remodeling may allow you to take advantage of new technology and building materials that will help with utility bills and access to social media. Also, needed updates will make your home more marketable in the future when you decide to downsize or relocate. Attic insulation, new doors and garage doors and window replacement are fixes that should enhance your property value.

 

Perhaps the most important decision you will make is determining who will do your work. If you don’t have a contractor that you can trust, check with some of your friends that may have recently done some rehab. Also, you can talk with loan officers, appraisers, real estate agents, building supply providers or other contractors that are too booked up to work with you. Make sure you have a firm budget for the work to be done. Find your comfort level and make projections so that you will not be surprised by the consequences of using a portion of your retirement nest egg for home improvements. You will have several options. You could draw on your savings account and pay a lump sum. Likewise, you could consider taking a distribution from your qualified retirement funds, being aware that this distribution is going to be treated as taxable income to you. Also, talk to your banker to see if a home equity loan might work. While this approach will leave savings and retirement funds intact, the new monthly payment will have to fit into your budget, especially since interest rates are as low as they have been in the recent past. Part of the planning format should be a scheduled meeting with your tax advisor and financial advisor to ask for guidance and to keep them in the loop. I think you will find their input to be a crucial piece of your decision making. As an aside, the last time my wife and I remodeled, my oldest daughter suggested that I could do whatever I thought was best, but just be ready to sell the house in the next seven years, because she would not be able to come to Alexandria to take care of us in our advanced age. That was three or four years ago and I don’t see where we are going to meet her deadline.

 

In recent days, my morning devotion took me to the short book of Jonah and his recounting of being trapped in the belly of a fish. The commentary suggested that we have all felt trapped at some point in our lives. The author shared that in his own story of distress and confinement, a friend told him that, “I said to Jesus, ‘if you hold my hand, I will hold on to yours’.” And it worked! It made all the difference in his life. You can do the same. Reach out to Jesus and expect to be surprised; expect to be made whole, to be received as you are, where you are. When you put your head on your pillow, as you close your eyes, open your heart and hands and mind to accept God’s presence in your life. Psalm 31: “Be of good courage and He will strengthen your heart, all you who hope in the Lord.”

 

Although this information has been gathered from sources believed to be reliable, it cannot be guaranteed.  This material is intended for informational purposes only and should not be construed or acted upon as individualized tax, legal or investment advice.  FSC Securities Corporation does not offer tax or legal advice.  The views expressed are not necessarily the opinion of FSC Securities Corporation. Financial Solutions Group is a marketing name.  Financial Solutions Group is located at 128 Versailles Blvd, Alexandria, LA  71301.  We can be reached at (318)448-3201. Securities, insurance and advisory services offered through FSC Securities Corporation, member FINRA/SIPC.