Through one’s younger years, it’s expected and encouraged to ‘move up’ in life regarding bank accounts, responsibilities attached to a job, and the size of a home. However, upon retiring, the kids growing, and a lessening need for large space, a number of elder couples consider downsizing.
Like most things, there are better ways to plan and a lot of mistakes to make, so if you’re an empty nester or retiree, consider the following information to help you make smart decisions.
Is Small Actually Cheaper?
There are multiple factors to consider when moving, and when searching for homes for sale, smaller necessarily doesn’t equal cheaper. For example, you can live in a very large house in the Carolinas but realize the same amount of money gets you substantially less in geographic areas like New York City or Los Angeles.
To ensure you have enough to enjoy your retirement, research whether smaller is actually cheaper. Also, include aspects like paying off an existing mortgage, realtor fees, furniture for the new living space, and transportation fees. Considering what you’ll get for selling your existing home against the price of a new home is only part of the puzzle.
Moving for the Right Reasons
Of course, there are several reasons for people to move: there is little reason to vindicate a large house, it’s getting difficult to get up the stairs and clean, Florida has better weather than Michigan, etc. Make sure you’re moving for the right reasons; in many cases, downsizing or moving away from familiar faces and surroundings is the wrong decision.
Also, be sure your projections are aligned with realities. For example, you may love the thought of living in Florida due to the sunny days, but the summers are intensely humid, a deterrent for some. Also, moving away from friends necessitates making new ones in a foreign place, which could prove more difficult due to travel limitations.
Perhaps a four-bedroom house is too much for one or two people and it is growing more difficult to scale the stairs or clean the entire home. However, that doesn’t mean you have to leave. You could ask family members to move in with you, which would help with the payments, cleaning, and mobility. Some are familiar and happy with their surroundings and downsizing incites feelings of anxiety and fright. Moreover, downsizing makes some think of death or that their next home will be their last, which are not pleasant thoughts.
Realize you don’t have to purchase another home; you can rent, which provides flexibility if you choose to move to yet another destination or finally decide to buy another home. The same is true about your existing home; you may decide to rent it out while you live with family members or rent an apartment, which buys time in making a more final decision.
Be Methodical Before Making a Move
Downsizing or moving away is not an easy decision and should take time. Rather than make quick decisions, take the time to think methodically, hiring a financial consultant for added insight.
Downsizing is a great decision for some yet unfruitful for others. Additionally, alternatives exist for those who prefer to stay in their homes or want to live in the same area.