We spend many of our working years paying on a mortgage so that we can own a house that’s just what we want. However, we can eventually reach a point where we may not need the same house that we needed twenty or thirty years ago. It can be easy to ignore this transition, or even not notice it. As you enter your senior years, here are some things to think about that could lead you to decide to downsize.
Excessive Cost
Whether you’re already living on a fixed retirement income or simply trying to position yourself financially for retirement, you’re wise to budget carefully. A home involves a great deal of expense, especially if you are still paying on the mortgage. Analyze your personal budget and see if you are spending more than 30% of it on housing costs (including insurance, taxes, and upkeep). If you are over that figure, consider downsizing.
High Value
The real estate market is a great area for investment, even if you’re not actually trying to invest. You may have built or bought your home just to have a place to live, but in time, your home may have appreciated significantly. At this point, you have the opportunity to realize a nice windfall of cash if you choose to place your home on the market and move into something smaller.
Heavy Maintenance Load
It seems the required maintenance and repairs on a home never stop. There’s always grass to mow, a leaky pipe to fix, or something to paint. As we get older, we have less enthusiasm, strength, and time for these tasks. Many seniors find that cutting back to a smaller home gives a better quality of life by reducing the burden of cleaning and upkeep, freeing up more time for travel, volunteer work, grandkids, or whatever they want to do.
Extra Space
A four-bedroom home is ideal when you have three kids at home, but after they’ve moved out and started families of their own, it doesn’t make as much sense. Neither does all the work or all the bills of those unused rooms. Once everybody is out on their own, it’s a great time to think about a home for just Mom and Dad.
When you step back and think it over, it’s often very easy to make the decision to move out of a too-large or too-expensive house and start checking homes for sale that make a little more sense for you. Ask yourself the above questions to better determine whether downsizing is the best decision right now.
