Retiring in a Million Dollar home or a Multi-million Dollar Home

[marko]

It is about location. Around here north of Boston, my garage alone is valued at more that $300K.

We winter in Fort Lauderdale where $5MM to $50MM homes are the norm. I've always maintained that a third of them are true wealth, a third are scrambling like mad just to stay afloat and a third are outright thieves who never had any intention of paying for anything.

Then there are those who own $2MM homes with the intention of selling them at retirement time and downsizing to a smaller condo. Of late however having that as your retirement plan isn't working locally as the condos in town are now going for $1MM or $2MM.

 

[socca]

I have a relative who married a very wealthy retired guy and moved into a $1M home. I pity them. Why? Well, given only two options in life:
(1) Having a boatload of money and living unskillfully, or
(2) Having a modest amount of money and living skillfully,
I would choose (2) in a heartbeat. My relative and her husband individually and collectively live unskillfully (IMO), and it causes them all kinds of grief.

So, what exactly does it mean to live skillfully? There's some debate about this ...

The ideal scenario is (3) Having a boatload of money and living skillfully.

 

[Willers]

It is definitely about location. Our house is $1M+ and while large (need room for visiting friends) is nothing extraordinary. That's just what a nice (not fabulous) house costs in our resort town. It does look better than the one in Vancouver though...

Excluding our home's cost we live a very modest life (most would call it frugal). The value of our home has nothing to do with our lifestyle. I don't think the two necessarily go hand-in-hand.

 

[COcheesehead]

I have a relative who married a very wealthy retired guy and moved into a $1M home. I pity them. Why? Well, given only two options in life:
(1) Having a boatload of money and living unskillfully, or
(2) Having a modest amount of money and living skillfully,
I would choose (2) in a heartbeat. My relative and her husband individually and collectively live unskillfully (IMO), and it causes them all kinds of grief.

So, what exactly does it mean to live skillfully? There's some debate about this ...

The ideal scenario is (3) Having a boatload of money and living skillfully.

How do you know they live "unskillfully" whatever that is? And why pity them?

 

[Breedlove]

Why do you want a million dollar home , the taxes could be dead money you could use for other things . We downsized to a small home in the country , probably not everyone's cup of tea but this is how we spend money . Our house was designed and built by us so it is highly functional . Utilitities are minimal , a million dollar home requires a lawn company and lots of other upkeep . Maybe later but right now , we are two people hell bent to enjoy the world.

 

[MRG]

There's many multimillion dollar vacation homes that sit vacant 50 weeks of the year where we live. They probably belong to the same folks that fly in on private Learjets.

 

[Big_Hitter]

a million dollar home requires a lawn company and lots of other upkeep .

no it doesn't - I maintain my acre lot by myself - it sucks but I do it

 

[donheff]

Why do you want a million dollar home , the taxes could be dead money you could use for other things . We downsized to a small home in the country , probably not everyone's cup of tea but this is how we spend money

Precisely, not everyone's cup of tea. If it was all about the money I would move to a house in a small town or the country but I don't need more money. Why leave a house and a place I like to generate $ I don't need?

 

[ShokWaveRider]

A million dollar home requires a lawn company and lots of other upkeep.

Nope, we pay to have our lawn done and still would if we lived in a shack. I mow Nothing!

 

[Big_Hitter]

Precisely, not everyone's cup of tea. If it was all about the money I would move to a house in a small town or the country but I don't need more money. Why leave a house and a place I like to generate $ I don't need?

talk about w*rk - we looked at a 5 acre parcel south of town a few months ago - I lost count of how many sprinkler heads I saw - they had a boatload of heavy lawn/farm equipment, well and septic too - no thanks

 

[marko]

I have a relative who married a very wealthy retired guy and moved into a $1M home. I pity them. Why? Well, given only two options in life:
(1) Having a boatload of money and living unskillfully, or
(2) Having a modest amount of money and living skillfully,
I would choose (2) in a heartbeat. My relative and her husband individually and collectively live unskillfully (IMO), and it causes them all kinds of grief.

So, what exactly does it mean to live skillfully? There's some debate about this ...

The ideal scenario is (3) Having a boatload of money and living skillfully.

IMO, retiring into a $1M house you can afford implies a certain level of "skill".

Marrying that guy implies even more skill!!!!

 

[Willers]

Why do you want a million dollar home , the taxes could be dead money you could use for other things . We downsized to a small home in the country , probably not everyone's cup of tea but this is how we spend money . Our house was designed and built by us so it is highly functional . Utilitities are minimal , a million dollar home requires a lawn company and lots of other upkeep . Maybe later but right now , we are two people hell bent to enjoy the world.

Everyone spends money on what they consider important...be it vacations, cars, homes, etc.

We have a $1M+ home, but the taxes are less than 1/3 what we were paying in the Midwest on a less expensive home. Utilities aren't any more expensive since we don't need any AC here in the summer. I mow the lawn which only needs to be done about every 10 days in our climate.

There are so many valiables that aren't being considered in this post. Want to live in a small house in the country? More power to you. Just know that your assumptions about others situations may be flawed.

 

[tb001]

We live in an expensive home and hope to RE in the next few years. I would prefer a smaller home and more financial flexibility, but my DH loves it here. We’re mostly homebodies, so spend a ton of time enjoying the property. If I had to mow the lawn or clean the house, I wouldn’t like it, but it’s just an expense we add to our annual expenses when we’re figuring out when we can pull the plug.

 

[ShokWaveRider]

Facts are, when you live where you and a lot of other people also "Want" to live and find desirable, the price goes up. When you choose to live where you like but lots of others don't, then you get a lot more for your money. As mentioned before Location, Location, Location.

 

[kgtest]

Yes, I know 2 people who retired in million dollar homes. When they bought them, they were worth MUCH less though and they grew into the equity over time.

Lake houses. One's a Dr, the other a Dentist who had his own practice.

 

[kgtest]

The value of our home has nothing to do with our lifestyle. I don't think the two necessarily go hand-in-hand.

This was the most surprising thing I learned when I moved onto McMansion street. Most of my neighbors have like super low electric bills, are fairly conservative financially with 10+ year old vehicles...but damn do they love there little show dogs LOL!

 

[T-Minus]

When I retired, we downsized from a large and greatly-appreciated home, and bought a single-level smaller home in a medium-upscale area in the low $800’s and saved/invested the difference. However, over the past couple years, property values have gone crazy here, to the point where homes in our neighborhood are now selling for > $1MM. Does that make us retirees in a $1MM home? Many of our neighbors are part-time residents (i.e. Snowbirds), who bought when these homes were in the $600k range - we’ve only met two couples who have bought at the top and use their home as a part-time residence. They both were small-business owners who sold their businesses...

 

[ncbill]

Grew up in a large (~6,000 sqft.) 1920s home here in flyover country.

Watched mom nearly go broke trying to keep it up after the divorce...forced to sell it just a few years later.

Recently sold for $1.5 million...fond memories, but I wasn't paying the bills.

Would not buy it today even had I $10 million in the bank...getting my recently deceased relative's 1930s home ready for sale has been a PITA.

No older homes for me, happy with my low-maintenance ~2500 sqft. 1990s townhouse.

 

[marko]

Why do you want a million dollar home , the taxes could be dead money you could use for other things .

... a million dollar home requires a lawn company and lots of other upkeep .

When I found this forum many years ago I fully expected to find FI people with not only multi-million dollar homes but perhaps two.

I would also assume there's a certain FI demographic where paying one's property taxes and home upkeep is not something that would force tough decisions on the rest of their lifestyle. My neighbor spends about $30K annually on landscaping (includes snowplowing).

To each his own!

 

[timemoveson]

When I found this forum many years ago I fully expected to find FI people with not only multi-million dollar homes but perhaps two.

I would also assume there's a certain FI demographic where paying one's property taxes and home upkeep is not something that would force tough decisions on the rest of their lifestyle. My neighbor spends about $30K annually on landscaping (includes snowplowing).

To each his own!

+1!

 

[kgtest]

When I found this forum many years ago I fully expected to find FI people with not only multi-million dollar homes but perhaps two.

I would also assume there's a certain FI demographic where paying one's property taxes and home upkeep is not something that would force tough decisions on the rest of their lifestyle. My neighbor spends about $30K annually on landscaping (includes snowplowing).

To each his own!

They are too busy blwoing their dough cutting muktiple 30k landscape checks...one for the lake house and one for the homestead. Getting on and off there NetJets and eating all that fine dining at night.

And keeping up with all that classic car and super car maintenance schedule. Well in between travelling to Maldiv, Bali and spending time in the Mediterranean on the MegaYacht, of course.

 

[marko]

They are too busy blwoing their dough cutting muktiple 30k landscape checks...one for the lake house and one for the homestead. Getting on and off there NetJets and eating all that fine dining at night.

And keeping up with all that classic car and super car maintenance schedule. Well in between travelling to Maldiv, Bali and spending time in the Mediterranean on the MegaYacht, of course.

My point was that not everyone who is retired has to watch every penny, making a choice between paying high taxes and dinner at Red Lobster.

There are some truly wealthy retired people out there....and some who never had to work at all.

 

[Teacher Terry]

I never understood moving away from a place you love just to buy a huge house somewhere less desirable. The people I know that did this aren’t happy. Now it’s different if you want to or have to. I have moved enough in my lifetime.

 

[tb001]

My point was that not everyone who is retired has to watch every penny, making a choice between paying high taxes and dinner at Red Lobster.

Yes! And for many RE is a choice. One they don’t want to make unless it allows for the lifestyle they’re looking for. Personally, I would make a ton of changes to lifestyle to RE, my DH not so much.

 

[kcowan]

Being in Vancouver, our level of house equity has to be over $10 million to qualify for this inquiry. We also have Chinese nationals who own such places and are absent most of the time. We expect a further influx from Hong Kong this year.

There are an estimated 300k "Canadians" living there now.

But people whose home equity has grown in place to such levels are not likely of interest here.