When you were young and just starting out on your career path, it’s quite possible that you dreamed of owning a large home on a sprawling property. Plenty of bedrooms for the children you would have one day. A multi-car garage. A garden, or maybe a pool in the backyard.
But as you inch closer to retirement, chances are thoughts of downsizing have begun to swirl around your mind. In addition to the obvious challenge of maintaining a large property, there are several other considerations, such as taxes and insurance. Additionally, large multi-bedroom properties that were once filled with children, playdates, sleepovers, and birthday parties might feel a little empty once children have grown up and left home.
From the obvious to the unexpected, here are four factors that make downsizing a smart retirement move.
To begin with, smaller properties are usually less expensive than large ones. Of course, if you traded in a large rural country home in Nevada for a small apartment in San Francisco, this would likely not be the case, but if you decided to stay in the same town or city and simply moved into a smaller dwelling, you can bet that your housing expenses would decrease. This carries over to maintenance tasks as well, such as cleaning, painting and mowing.
Renting in particular can also be a smart choice cost-wise, as it prevents you from having to worry about expenses like upkeep, insurance and property taxes, which are the landlord’s responsibility.
As we age, activities that were once easy (for example, climbing the stairs) might be a bit more difficult to manage. Smaller homes are usually easier to get around, as they are more often a single level. Additionally, for retirees who don’t like to rely on a car or don’t enjoy driving, downsizing to an apartment located close to restaurants, retail or grocery stores, and other amenities may alleviate some stress.
One major perk of renting in particular is that it provides more flexibility. If you’ve always dreamed of living in Hawaii, but aren’t sure you’ll be able to handle the year-round heat, you can sample the location without committing to home-ownership or a mortgage. If you end up missing the seasons, instead of having to search for a realtor and put your house on the market, all you have to do is wait for your lease to be up!
While many retirees probably aren’t moving to a smaller dwelling to get their life organized, a surprising joy of downsizing can be just that. Downsizing means less storage space, and less storage space means you will be forced to seriously consider your belongings. Do you really need (or want) three different sets of China? What about that broken treadmill that you’ve been planning to “get fixed” for the last six years? Marie Kondo your belongings and stop carrying around all of that extra baggage (literally!)
In addition to taking some stress off of you and your home, decreasing your clutter is a true gift for your children. One of the most unpleasant aspects of dealing with the loss of a loved one is getting their affairs in order, belongings included. Just think how much easier you will make it on them if you downsize your belongings ahead of time!
Get prepared with The Humphreys Group
At The Humphreys Group, we work with women in transition, including those prepping for retirement, to create tailored long-term financial plans that suit their individual goals and personal vision. Are you planning your retirement? Considering selling your house and looking for an apartment? No matter what your personal situation is, our team is happy to provide a second opinion. Reach out to schedule a chat!