Why all retirees should sell their home at 62

@budgeters_anonymous

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SoundTikTok sound · More of My Time (Lofi)

Why it worked

The video provides a clear, actionable financial strategy for retirees, using simple visuals and relatable examples to explain complex concepts like asset allocation and tax implications. The focus on saving money and gaining financial flexibility resonates with the target audience.

Summary

The video explains why retirees might consider selling their homes at age 62. It highlights that most retirement net worth is tied up in homes and stocks, and selling a home could provide significant income and tax advantages, especially when converting traditional IRA assets to Roth IRAs.

Structure

1Retirees' net worth is tied up in homes and stocks.
2Selling a home can generate significant income.
3Selling a home after 63 can impact Medicare premiums.
4Converting traditional IRA assets to Roth IRA can save on taxes.
5Selling a home provides time to convert assets and save on taxes.

On-screen text

Why all retirees should sell their home at 62 Net Worth SPY 1/3 $20k 63+ $600k 2/3 $400k $20k Taxes Medicare Premiums ↑ $609/mo 2 years Traditional vs Roth 90% DOING THIS WOULD SAVE TENS OF THOUSANDS OF DOLLARS ON TAXES FOR THE AVERAGE RETIREE. WHEN IT'S IN A ROTH, YOU DON'T HAVE TO PAY THOSE TAXES. YOU SELL THIS HOUSE AND YOU PULL THAT $20,000 PER YEAR. FROM THAT $400,000, YOU DON'T HAVE TO WORRY ABOUT PAYING TAXES ON THAT WOULD BUY YOU SOME TIME IN YOUR 60S TO FOCUS ON CONVERTING THAT 90% FROM YOUR TRADITIONAL TO YOUR ROTH IRA.

Original caption

#retirement #retired

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Transcript

My mom just turned 62 and I'm trying to convince her that this is the perfect age to sell her home. Here's why. Most retirees have their net worth tied up in two main areas. The stock market and their home. Here's the thing, about one third of that is in the stock market and the other two thirds is equity in their home. It means that if you retire with $600,000 net worth, at $400,000 of that is just equity in your home. If you sold it and put that money into the stock market, that can kick off an additional $20,000 in income each year. I'd rather have this home than have this $20,000 a year. But at some point later on in life, you might need that $400,000. If you sell this at the age of 63 or older, then it will impact your Medicare premiums. Basically guaranteed to have an increase in about $609 a month for two years. I guess two years, not the end of the world. But here's my final pitch on why you'd wanna sell your home. 90% of retirement assets are held in a traditional IRA. That means that when people are retired and they pull money out of the stock market, they actually would have to pay taxes on top of that. When it's in a Roth, you don't have to pay those taxes. You sell this house and you pull that $20,000 per year from that $400,000, you don't have to worry about paying taxes on that would buy you some time in your 60s to focus on converting that 90% from your traditional to your Roth IRA. Doing this would save tens of thousands of dollars on taxes for the average retiree.