Many baby boomers worry about not having enough money for retirement.
They don’t want to continue working until they’re 70 years old, but they worry that Social Security won’t provide for their needs.
Also, they want to enjoy their retirement years while they're still in good health.
They want to travel, spend time with grandchildren, or simply relax and enjoy some much-earned downtime.
Becoming a landlord can provide a low-stress source of income that will allow you to retire from your job.
In addition, owning investment property is tax-friendly, so it can alleviate a lot of tax time financial pressure.
Fortunately, you don’t have to invest in a huge apartment complex to enjoy the benefits of becoming a landlord.
Try some of these simpler ideas to make your experience lucrative, low-maintenance and rewarding.
Buy a Duplex or Multi-Family Home
If you’re willing to downsize and don’t mind sharing your property with a tenant, buy a duplex or a multi-family home.
With a good credit history, you can get an FHA mortgage for a down payment as low as 3.5 percent, or you can put a 20 percent down payment on a conventional mortgage.
Then, you can rent out the other units in your property to tenants, and you can use their rent payments to offset your mortgage costs.
Remember that owning a duplex requires you to stay on top of maintenance, so be prepared to pay for costs such as landscaping and lawn care, snow removal, leaf removal, maintenance and other typical homeowner’s expenses.
Expect to spend between 1 and 4 percent of your property’s value every year on maintenance expenses.
Fortunately, most of those expenses are deductible from your rental income, so keep your receipts and talk to your accountant.
Rent Your Home as a Vacation Home
If you live near a beach, a national park, a recreation area or other tourist attraction, then you might supplement your Social Security income by renting your home to vacationers.
This strategy could work well if you’ve already paid for your home, but want to move closer to your children or to a more appealing climate.
Instead of selling your home, you can keep it as an asset to hedge against future big expenses, such as major medical or long-term care expenses.
When you rent your home as a vacation home, you can sometimes collect as much per week as other landlords collect in a month.
Do some research to see what other people in your area charge to rent their homes.
Then, list your home on a reputable vacation rental website and prepare to screen prospective tenants.
Decide what things you will leave in the house permanently, such as dishes, linens, furniture and other amenities, and what items your guests should bring with them.
Also, hire a caretaker or housekeeper if you plan to live far away from the home you’re renting.
Owning property isn’t without risks.
For example, if a natural disaster destroys your rental property or causes significant damage, you’ll need sufficient insurance or savings to cover repair costs.
Also, if something happens to you, or your health takes a serious decline, you need to have a succession plan in place to make sure someone cares for your property.
Additionally, being a landlord requires work, so make sure that you’d enjoy the tasks associated with property management.
Property management isn’t worthwhile if you have no time to actually enjoy your retirement.
Ultimately, owning a diverse portfolio of assets is the key to a safe and prosperous retirement.
If you have Social Security checks, pension income, securities and rental income, then you don’t have to worry that adverse events, like a plummeting stock market, would signal the end of your retirement adventure.
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