Updated: Friday, January 22, 2021
The Ultimate Seniorsâ€™ Guide to Homesteading In Retirement
We tend to picture retirement one way: seniors leisu>
However, many seniors who might be interested in homesteading dont know where to start. Thats why weve put together this guide. We hope these tips help you figure out if homesteading is right for you, and along with insights on the real estate from The Data Advocate help you get started on your journey toward the perfect retirement:nbsp;
Who Should Homestead?
Your first step should be evaluating whether or not homesteading feels like a good retirement for you. Remember, homesteading doesnt necessarily mean being enti>
Homesteading is a significant physical undertaking, which can be a pro and a con for retirees. On one hand, its built on physical exercise that can keep you healthy for years. On the other, if you have existing health issues or develop them down the line it can become too much of an undertaking, especially if you have a lot of land. Although there are ways to make things more manageable more on this later, recognizing the physical demands of this life>
Finding Your Propertynbsp;
Homesteading would traditionally require a rural property, but thats not the only option these days. More and more technology has emerged that makes urban and suburban farming possible. Plus, as interest in sustainability rises, more and more neighborhoods are allowing homesteading features such as a backyard chicken coop.nbsp;
Check out the properties that are available on your market, and try to imagine how youd set up your homestead there. Remember to consider options such as greenhouse growing, vertical gardening, and hydroponics. These can really expand your ability to grow the foods you want in a smaller space or non-ideal environment. Finally, be sure to check zoning rules some neighborhoods will have restrictions that can prevent you from achieving your goals.nbsp;
Meeting Your Physical Abilitiesnbsp;
As we said above, homesteading is a great way to stay active well into your golden years, but its important to only make a job for yourself that youll be able to handle in the long run. A huge property with sweeping gardens isnt likely to be sustainable, and unless you want to hire farm hands, youll need to think smaller.nbsp;
This is where those alternative gardening methods we mentioned earlier can really come in hand for seniors. Vertical gardening can give you the ability to keep a significant amount of crops growing in a >
Although its not right for everyone, homesteading offers a fun and satisfying way to retire. Its important to create a practical, sustainable plan in order to make the most of it. After all, there are few things quite as empowering as living off of your own land and hard work well into your golden years.nbsp;
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What Are the Best Ways to Use Your Homeâ€™s Equity?
Your home equity can be a valuable resource to you, depending on your financial situation. Your equity is the interest you have in your home, as the owner. Your equity increases over time in two ways. Equity increases if your property value goes up or if you work toward paying down the balance of your mortgage loan.
Equity is the part of your home that you truly own if you borrowed money to buy it. If you did get a mortgage, the lender has an interest in your property until you pay it off, despite you being considered the homeowner.
The equity you have in your home is considered one of the most valuable assets you have.
Since it is an asset, you can use it. There are three main ways people use the asset of their equity. One is to sell your home. If you decide to move, you receive your equity from the proceeds of the sale. You can also borrow against the equity, and you can use a reverse mortgage to fund your retirement.
Buying a New Home
If you sell your home, you can put the equity aside, or you can use it to buy a new home.
If you have, lets say 70,000 in equity in your home, then youll have a profit after closing. That profit can then be used for your down payment on your next home.
The bigger the down payment, the more expensive the home you may be able to afford. Your mortgage payments may be lower with a bigger down payment as well.
Borrowing Against Your Equity
Another way to use equity is to borrow against it. There are three primary ways to do thisa home equity loan, a home equity line of credit, or a cash-out refinance.
When you use your homes equity as a way to borrow money, youll get a lower interest rate than you likely would with something like a credit card or personal loan.
Theres a downside too. If you dont make your payments, a lender could foreclose on your home. This wouldnt be the case if you were to use credit cards, for example.
A home equity loan is somewhat like a second mortgage. You can use the proceeds of a home equity loan however you want, and you pay it back in monthly installments with interest added. It works very much like a traditional mortgage.
A home equity line of credit is structured more like a credit card in that a lender gives you a credit limit based on your equity. You borrow as you need with a HELOC and also pay it back as you borrow.
A cash-out refinance lets you refinance for more than whats owed on your mortgage, and you get the extra money as cash that you can use.
How to Build Equity
Since equity is a valuable asset that gives you financial flexibility and options, building it is an important goal.
One of the fastest ways someone builds equity is by coming up with as large a down payment as possible. The bigger your down payment, the more equity youll have right away.
If you already have a mortgage, make every effort to pay it off. When you first start paying a mortgage, smaller amounts go toward your principal, and more goes toward your interest. However, the longer youve had your mortgage, the more goes toward your principal, helping you build equity.
If you ever have opportunities to pay more than the minimum on your mortgage payment, do it. Some people make an extra payment each year, or they make biweekly payments. Even paying just a little more each month can help you reduce your principal balance and increase your equity faster.
If you stay in your home longer, you build more equity, particularly if it increases in value.
Finally, certain renovations that add value can also help you build equity. For example, adding a bathroom or doing a kitchen remodel can improve your homes value, increasing your equity.
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What are HOA CC&Rs?
"CCamp;Rs" is an acronym commonly used in the homeowner association industry. It means "Covenants, Conditions amp; Restrictions." It is used generically for any HOA rule or policy. But its more complicated than that. In the HOA environment, there may be policies, procedures, rules, regulations and resolutions. All are necessary to do the HOA business properly. But what exactly are policies, procedures, rules, regulations and resolutions?
A policy is a standard adopted by the Board that sets out the beliefs, values and objectives that causes the homeowner association to act. such as a collection policy, an enforcement policy, or a conduct of meetings policy. A homeowner associations policies communicate, organize, and focus the resources of the homeowner association.
A procedure is the process that accomplishes a particular objective. For example, the homeowner association should have a clear and defined policy regarding assessment collection. The detailed steps of how this policy is achieved comprises the procedure of collecting assessments.
Rule or Regulation:
A homeowner associations board of directors adopts rules, regulations or guidelines to define desired behaviors and to set limits on allowable uses of the common elements and homes or units, architectural changes and the behavior of residents and guests. Some typical examples of rules include pets, parking, noise and use of HOA facilities.
A resolution is a method of formalizing a decision made by an homeowner associations board of directors. Resolutions are used to adopt policies, procedures, rules and regulations or to clarify ambiguous terms in the governing documents. Resolutions should include four components:
Authority. The section of the governing documents that gives the board authority to adopt resolutions;
Purpose. Why the resolution is needed or being adopted;
Scope and Intent. Who will be affected, the reach, range and extent
Specifications. A clear and complete statement on what those bound by the rule are expected to do.
So there you have it. Now you can speak like an HOA authority. CCamp;Rs arent just for acronymizing anymore.
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