Many people trade up throughout their lives and live in increasingly more valuable homes. This can provide you with an ever-improving quality of life while you put your money into real property. Depending on the markets this can be an efficient course of action all around.
Keep in mind, however, that you will still have to pay property taxes after the home is paid for during your retirement years. Getting a rather large annual bill is something that you have to prepare for when you are budgeting for the future.
Apparently a lot of people fail to do so. At least $7 billion in property tax liens are imposed each year according to the National Tax Lien Association. This statistic includes all people who are delinquent on their taxes and not just retirees,but a number of retirees are at risk when they fail to put adequate money aside for the big tax bill.
Individuals who fall behind on their property taxes can usually arrange for installment payment plans. However, this approach is not ideal because you actually wind up paying more because the county may charge interest. Planning ahead would avoid unnecessary interest.
This is one of the many details that you have to take into account when you are making long-term financial projections. Keep in mind, as well, that as your financial circumstances change, other aspects of your estate planning may need to be adjusted. Contact your estate planning attorney for your regular review and keep your estate up to date.
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