Trading Down No Longer Safe Retirement Strategy

Once upon a time a majority of people followed this seemingly fiscally sound path: Buy a home, spend your working years paying it off, and then sell it so you can trade down once the kids left. Magically, all that built-up equity could fund your retirement.

What a fairy tale!

Today the baby boomers are discovering that selling their home isn't the golden ticket it once was, reports the Wall Street Journal. The Journal references a Harvard study that indicates that "mobility rates among seniors have posted the sharpest drop." When the costs of moving and selling a home at a loss are evaluated, it makes financial sense for some seniors to stay put. Others find themselves underwater due to the housing market collapse or natural disaster.

What happens to the retirement wishes of all those folks who anticipated heavy paydays with the sale of their home? And what can younger generations learn from this?