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Dear Vanessa,
I’m 57 and divorced, and now I’m trying to decide what to do with my half of the settlement. I’ve always lived in a house, but with property prices the way they are, I’ll probably have to settle for an apartment in a place I don’t really like.
I’m wondering if I should stop buying altogether and rent it. I would have the freedom to live wherever I wanted and could invest the rest of my agreement to increase my wealth. But I’m also worried about not having the security of home ownership as I get older.
I never thought I would be in this position and I am having a hard time deciding what is best. What do you think?
Thank you,
Greg.
Hi Greg,
Your situation is challenging and it is great that you are taking the time to carefully consider your options. Big financial decisions made during stressful times (what I call financial tipping points) are often not the best ones in the long run. That’s why I encourage you to avoid rushing into anything.
Vanessa Stoykov, noted monetary educator (above)
Renting for a while could be a smart interim step. It gives you breathing room to explore your options without locking yourself into a decision you may regret. You can take the time to figure out what feels right for you, whether it’s buying a home for security or investing to create more flexibility.
If you’re thinking about eventually buying, it’s essential to secure a competitive mortgage rate when the time comes. Even a small difference in your rate can save you thousands of dollars over the life of a loan. My free mortgage rate tracker can help you see what you’re eligible for and compare prices to find the best deal.
As you consider your next steps, don’t forget to consider your retirement. This could be the perfect time to reevaluate your retirement strategy. An advisor might suggest you top up your super with part of your settlement or plan the best way to withdraw it when the time comes.
To help you make these decisions, I highly recommend that you speak with a financial advisor. They can help you think clearly and strategically about your next step. You can access my free matchmaking service with an advisor here.
Taking a pause now could lead to a much better outcome for your financial future and give you the clarity to make a plan you feel confident in.
A cordial greeting,
Vanessa.