30 Mar Ten Reasons to Downsize Before You Retire
Are you nearing retirement and considering downsizing your home? If you’re not, you really should! There are lots of benefits—some you may have thought of and some you might not have. Here are the top 10 reasons to downsize before you retire.
#1 Sell your house and make a profit.
If you’ve been in your house for a while, you probably have a good amount of equity. If this is the case, then you could make a nice chunk of cash off the sale of your larger home in order to easily purchase a smaller house. You may even have some additional money left over that you can invest, use for travel, or put toward debt. For tips on how to pay off your house sooner, be sure to check out this article.
#2 Less yard work.
A larger home requires more money, time, and physical effort to keep up with. With a smaller home, you’ll find that you can spend less time and money taking care of your home, and you’ll have more energy to enjoy your retirement. With more cash in your pocket and more time and energy to yourself, you can pursue hobbies, enjoy time with your family or grandchildren, and have more time to just relax.
If your smaller home is also newer or is under warranty, you probably won’t have as many repair and maintenance issues either. Also, if your home has a community association, some outdoor maintenance is taken care of for you, so that’s a bonus.
#3 A fresh, new start.
Out with the old and in with the new! Sometimes it’s nice to start a new phase of your life with a new start. Downsizing to a smaller house and a new part of town can be just the change you need—maybe living closer to or farther from town, maybe living closer to your children or grandchildren, or maybe relocating closer to the mountains or ocean. Retirement can be the perfect time to make a fresh, new start, so embrace it!
#4 Save money on utilities.
Utilities costs are nothing to laugh at. And if you have a larger home, you know exactly what I’m talking about. Between heating in the winter and cooling in the summer, you hardly get a break, right? And what about water, sewer, and electricity costs? As you can see, a larger home means a larger utility bill, so downsizing makes a lot of sense. When you heat or cool a smaller home, you get to enjoy a smaller bill. Plus, you are saving energy, which benefits our environment. Reduced utility bills also mean you have more money at your disposal for travel, investing, or fun.
#5 You will be able to declutter.
If you feel like your larger home tends to collect more clutter, you’re not alone. It’s almost human nature; the more space you have, the more stuff you accumulate to fill it. Even with good intentions, clutter can happen anyway. But if you downsize to a smaller home, you’re almost forced to declutter and get organized. You have to decide what really matters and what you can do without. You have to choose between throwing something out, donating it, or giving it away because you won’t have room for it in your downsized house. Any way you look at it, downsizing is a great way to help you reevaluate what you really need and what you can part with. And you may find that you’ll come away with a better sense of what’s really important to you.
#6 Sell unwanted items.
This goes along with decluttering. If you downsize to a smaller home, you obviously can’t take all your stuff with you. Inevitably, you’ll probably even find forgotten treasures that you can turn into cash. This is a win-win all around: you put money in your pocket while reducing your possessions, and the buyer ends up with a good deal too.
There are countless ways you can sell your unneeded or unwanted items: Craigslist, eBay, garage sale, live auctions, and consignment shops are just a few. With fewer items to take with you to your downsized home, the less cluttered and more comfortable it will be. So sell away!
#7 More financial benefits.
When you downsize to a smaller home, you’ll free up money to spend on other things. With more money at your disposal, life opens up in many areas:
> More money to travel—If you enjoy traveling but just haven’t had the extra cash to go on trips, downsizing to a smaller house could be just the ticket to help you make it happen.
> Entertainment—From going to the movies or bowling more often to visiting museums or attending the opera, entertainment is a luxury that you can enjoy more with additional cash at your disposal.
> New hobbies—Hobbies are enjoyable, but they aren’t always affordable. Whether you enjoy golf, electric trains, or rock climbing, you need money to pursue your hobbies. And downsizing can help you find the extra money you need for the hobbies you put on the shelf years ago.
> Pay down debt—You could choose to do the responsible thing and use the additional money you have from downsizing to pay off debt.
> Take classes—If you’ve dreamed of going back to school to further your education, or you’ve always wanted to take a cake decorating class, downsizing your home could help you find the money you need to make that happen.
#8 Diversify your assets.
Putting all your eggs in one basket is never a good idea. It’s the same with your finances. If all your assets are invested in real estate, you could be setting yourself up for trouble if the market goes south. When you sell your larger home, be sure to invest some of the profit in other areas such as an IRA, 401(k), stocks, bonds, or mutual funds.
#9 Reduce consumption.
With a smaller home, reducing your consumption and contributing positively to the environment are much easier goals to accomplish. You might even find yourself being able to reduce your consumption in other areas such as utilities, product packaging, and eco-friendly products.
#10 More memories.
Do you find yourself holding on to things you own because of the memories they hold? When you choose to downsize your home, you can begin to focus more on making memories than storing your possessions. Sure, your larger home probably has a lot of memories associated with it, but undoubtedly, you’ll be able to create special memories in your new home too.
All things considered, you can see that there are many benefits to downsizing before you retire—some practical and some emotional. What are some other benefits to downsizing your home before you retire?
