Should you rent in retirement?

Some people rent in retirement because they don’t have much choice; they can’t afford to own homes. But financial planners say renting can make more sense than owning in some circumstances, even for retirees who can afford the costs of homeownership.

Renting offers flexibility as well as freedom from all the chores and expenses of maintaining a home. Renting also may provide built-in communities for socializing, as well as accessible housing features such as one-floor living, which can help people age in place. People who are “house rich and cash poor” can sell their homes and use the equity to fund a more comfortable lifestyle.

“While retirees often don’t want to rent, it can be a smarter decision for a number of reasons,” says certified financial planner Lisa A.K. Kirchenbauer of Arlington, Virginia.

Consider renting if you’re in transition

If you’re moving to a new area, financial planners often recommend renting first to get a better feel for the advantages and disadvantages of various neighborhoods. You’ll need time to find new doctors, check out entertainment venues, locate favorite restaurants and otherwise set up your support services, says Delia Fernandez, a certified financial planner in Los Alamitos, California.

“It makes sense to rent for maybe even a year so you can really dig into the community and figure out what’s going to be the right fit for you,” she says.

Renting is often smart if you expect to move again within a few years. Buying and selling homes is expensive, and your home may not rise in value fast enough to offset those costs. Selling a home also may take longer than you expect, especially during a real estate downturn, which could add stress, delays and additional costs to your move.

Renting could help you age more safely and serenely

Few homes are truly accessible to people who have mobility problems or other age-related disabilities, and adapting your current house could be prohibitively expensive. Newer apartment buildings could offer ramps, elevators, one-floor living and other amenities to keep you safe as you age. (AP)