Downsizing Your Home as You’re Heading into Retirement
Written by: Mackenzie K.
If retirement is right around the corner, you’ve probably got a lot on your mind. How will you spend your time? Will you still need two cars? Will you be spending more time with the grandkids? And perhaps most importantly: do you still need your big family home?
Downsizing is something plenty of people decide to do during a major transition—when the kids leave home, when you’re moving to another state, and of course, when it’s time to retire.
Some soon-to-be retirees decide they don’t want to spend their free time taking care of a large home anymore. If this is you, here are a few tips to make your downsizing a success!
Make sure you actually downsize.
If you’re downsizing for retirement, make sure the home you purchase is actually smaller than your current one—not smaller by 100 square feet, but significantly smaller!
This is important because if you’re not actually downsizing by a significant amount, all you’re really doing is incurring the costs of moving—and you may not even be saving much on your mortgage. What’s more, during retirement you want to avoid any extra costs that you can.
Do a major de-clutter before you decide to move.
Decluttering is a huge element of downsizing, so you need to tackle this part before you list your home or start looking for a new one.
For one thing, getting rid of clutter will help you sell your house if you do decide to move. For another, it can also help change the way your home functions and how you feel in it. You may even decide you don’t need to move, after all!
When you’re decluttering, you’ll want to start small. Begin with a drawer, a shelf, or a closet, rather than an entire room. This will prevent you from getting overwhelmed. Move on to the next space only after you’ve completely finished the first one.
Consider renting after you sell.
While many retirees feel strongly owning rather than renting, there are certain perks to renting that may warrant a second thought.
You won’t have to worry about home maintenance, for one thing. You also won’t be paying homeowners insurance or real estate taxes (although that doesn’t necessarily mean your expenses will be lower than if you buy—make sure to do that math before you decide either way).
Renting will work best for retirees who may want to move around a bit or try living abroad for a period, rather than those who want to be in one place for the rest of their lives. Owners of rental houses are, of course, entitled to sell their properties once a lease is complete, and that can be a nasty surprise if you’re not planning on leaving.
If you plan ahead, consider your options, and choose wisely, downsizing could just be the key to a happy retirement.