AARP Interviews Tucker Childs on Financial Planning for Snowbirds

I recently was given the opportunity to provide some insight for AARP readers in a money feature about second home ownership. In a list of nine tips, snowbirds are encouraged to weigh their options before committing to a purchase, including additional expenses like taxes and insurance needs. My key suggestion is to try before you buy.

From the article:

Financial advisers and real estate agents suggest spending a few months living in a town or city before buying a second home there.

Test-driving the locale “gives you a chance to get a better feel for the area, notice things that may not be obvious during shorter visits, and determine whether it truly suits your lifestyle,” says Tucker Childs, director of wealth planning at Bradley, Foster and Sargent, an investment advisory firm in Hartford, Connecticut.

When considering a second home purchase, it’s best to look before you leap. Buying a home is a complex transaction that can be difficult, and potentially costly, to unwind. Even if you plan to settle in a particular area long term, spending a season there first can be eye opening.

Renting offers a low-risk way to test things out. Especially in retirement, flexibility is a valuable asset, and renting provides just that.

Purchasing a permanent residence has its advantages. These may outweigh the financial risks by offering a stronger connection to the community, the ability to make the place your own, and the potential to benefit from property appreciation.

The financial tips offered in the article also address cost and logistical considerations for multiple homes. After all, leaving a home unoccupied involves more than double checking that the door is locked and the stove is off.

Advances in affordable technology solutions have improved the ability to keep an eye on things from afar. In addition to security cameras and smart doorbells, consider tools to monitor the interior of the house such as water leak sensors and smart thermostats. In the event of the unexpected, ensure all of your important documents are secured in a fireproof/waterproof safe or a safety deposit box.

It’s also important to let your insurance provider know that your home will be unoccupied for an extended period of time to ensure that your policy remains valid in your absence.