Buying a home is one thing, and making the decision to do just that will influence how you live your life for years, even decades into the future. It’s a major financial tie that can dominate a lot of your life. If you’ve gotten through all those years and have your home fully paid off, or if you have been lucky enough to pay it off early, you might be asking yourself: what now? You might be content to live in it, as is, but there are options available that might be worth considering.
Celebrate and take a load off
You’ve taken the time or made the right moves so that you can enjoy living in a home without having to pay off a home loan. You’re going to find yourself with extra cash in the near future, so why not consider taking a celebratory vacation? Or you can just relax and enjoy living life with a little more budget to spend for a while. You don’t have to rush into any decisions.
Pay off all your other debts
However, once you discover that you do, indeed, have that extra in your budget, it’s not uncommon that you might start thinking about what might be the best way to make use of it. For your long-term betterment, identifying the other debts that you can start to pay off is a sensible option. Your mortgage is likely to be the biggest and costliest debt that you had, so from there, you can continue following the avalanche method. Clear your other bigger or higher interest debts first, so that you can start feeling the benefit from the savings a lot sooner. With the extra money in your budget, you should be able to clear any other debts a lot more easily, allowing you to take a step closer to living with financial freedom, while greatly improving your credit.
Focus on your retirement
If you have paid off your home loan early, then you might not be looking at retirement for a few decades yet. But that doesn’t mean that it’s not a good time to start contributing to it. Basically, the sooner that you want to be able to retire, the sooner that you should be contributing towards your retirement. There are all kinds of retirement preparation plans that you can make but the gist of it is all about finding the right savings to put your money into so that, when you reach your preferred retirement age, you can live in relative peace. There are also retirement calculators that can help you get a better idea of how much you will want to put aside each month.
Make some improvements
Now that you have paid off the home, it is yours to do whatever you want with it. However, over the years of living there, you might have noticed real upgrades you can make to increase the quality of life of the family. You’ve freed up a significant portion of your credit load, so it might also free up the space to look at some home improvement loans, allowing you to access the cash to make the improvements that you have been thinking of. It will be a lot easier to manage the loan without a mortgage alongside it, and any investment into the practical needs of the home also tends to improve its value as an asset, too.
Consider moving up the property ladder
Now that you have your home paid off, you might think that it’s time to keep moving on up the property ladder. There are a few ways to do this, too. You can, for instance, sell off your current home and, alongside the money you get from that, seek out another mortgage to help you buy a bigger and more valuable home, with the aim to pay that off in the future, as well. Or, you could consider becoming a landlord or property investor, continuing to live in your home, but taking out a loan so that you can purchase another place that you rent out to tenants. When you don’t have to pay for the home that you’re living in, it’s easier to assume the costs of buying a rental.
The options that can suddenly open up to you when you finish buying off your home are not to be underestimated. However, you don’t have to rush into a decision. Think about your current position and where you want to be in the future, basing your next moves on your long-term plans, not just what sounds good now.
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