Baby Boomers are increasingly downsizing to smaller homes or opting out of homeownership entirely in order to prepare for retirement, according to a new study from Bank of America Merrill Lynch.
The survey pointed out that tens of millions of Baby Boomers will soon migrate into retirement, and could soon modify family spending, continue working or downsize or relocate their home.
In fact, three out of four Baby Boomers answered they would downsize their home to lower ongoing costs and for the benefit from the equity. Another 67% said they would be willing to move to a less expensive location.
But many Baby Boomers also said they were willing to give up homeownership entirely. The study showed 47% would consider selling their home and renting an apartment.
“Although we are all challenged to fund our longer lives, this suite of studies has repeatedly revealed that Americans remain quite hopeful and are willing to consider a wide range of course corrections in order to enjoy a secure retirement,” said Ken Dychtwald, CEO and founder of Age Wave, a thought leader on population aging and its profound business, social, financial, health care, workforce, and cultural implications.
A study last summer by Freddie Mac showed that, because older generations are downsizing, they are actually pushing Millennials out of the housing market.
And for those who aren’t downsizing, they seem to be abandoning the American Dream as Baby Boomers begin moving into the apartments and urban areas.