The mere thought of retirement brings up many lifestyle changing ideas, and the biggest of them all are real estate decisions; what will be considered home during the golden years, is the question that tops the list. Some will decide to relocate, some will downsize, while others will repair their current house, due to so many options most will make mistakes, know them in advance. It is better to learn from other peoples’ mistakes than your own.

If you are thinking about downsizing, you probably have a good reason for it, which means that every additional year spent in a large home is costing you more, you are paying more than you should for; real estate taxes, homeowner-insurance premiums, and for utility bills. You do not have to wait for the last child to move out, if this is your way of thinking you may not get out of your home for the next decade, since the new trend predicts that often time children will boomerang back. If you do end up downsizing and coming out with a profit you should immediately invest this money. Most people, however look at this as if they just received a bunch of spending money, instead of looking to invest it. Of course, there are many investment options to choose from and it is best to set up an appointment with a financial advisor. A financial advisor will examine your life and financial goals and determine how to best allocate this money. If however you have other plans in mind, such as moving to a warmer, sunnier place then you should do your due diligence. You need to research how much your cost of living will be, how much you will have to pay in taxes, and the cost of health care. You will need to be aware of how the health care system is run, and you should find a doctor. Moreover, you should really look into how you will spend your days. Yet others will try to maintain having two homes at once. This is often very difficult to keep up, and it becomes a drain on your finances. If you fall into this category, then you should really have two small properties, that way you will have manageable running costs. Another common mistake is having a mortgage in retirement, if you take out a mortgage at 50, you will be stuck with this mortgage until 80. Mortgage interest is deductible from the income tax but is it really worth it, considering that many retirees live on IRA distributions, and Social Security the tax deduction is not that big of an incentive.