You’re retiring! Congratulations! This is a huge milestone in your life. After having spent years working, surely retirement is something you have known to be approaching, and you’ve been planning diligently for it. One of the big things that you’ve considered is downsizing your existing home. Whether you’ve made the decision based on the financial benefits or simply because you’ve got too much house for this next stage of your life, REMAX can make this transition in your life as easy and as seamless as possible.
Why Downsize?
You’ve heard about some retirees downsizing and perhaps even seen some of your friends do it as well, but you’re not sure if it’s for you. Below are some of the reasons why downsizing your home for retirement may be the best next step.
1. You’ve Got Too Much House
Like so many retirees out there, you’re at the stage of your life where perhaps your children are fully grown and independent, and what was once a necessity to have that much square footage of living space just seems too much now. If you find that you’re not fully using the living spaces in your home for anything other than storage, perhaps this may be a good time to think about downsizing.
2. The Equity
Whether you’re entirely mortgage-free (Woohoo!) or if you’ve got a little bit or a good chunk left over, downsizing your home could really be a smart financial decision for your retirement. Downsizing is just that, trading a physically larger, in size and value, home for another that is smaller physically and in value. As you have paid down your mortgage over the years, the value of your home and your equity have risen. Just as an example, if your home is sold for $850,000 in today’s market, and your remaining mortgage balance on that home is $100,000 going into retirement, your equity is the difference, which is $750,000. It would be a very wise decision to explore your options by seeing what is on the market that can suit all your needs and allow you to be mortgage-free, by downsizing and acquiring a home that is priced under what your equity is. This move could save you thousands in interest on your remaining mortgage balance and increase your monthly cash flow by not having a mortgage payment to worry about on a retirement income.
3. The Upkeep
To have planned for retirement, you have probably already thought of the upkeep that is required of your existing home. Whether it’s keeping up with cleaning the inside of the home or maintaining the outdoors, it takes physical stamina and strength to do both. The reality is that we do get older year by year, and something that you now have time for because you’re no longer part of the 9-5 club may seem easy and maybe even enjoyable, but that may not be the case down the road. Unfortunately, some things become harder to do with age, whether it’s cutting the grass, shovelling snow, getting groceries in from the car up your beautiful, but never-ending, front entrance stairs, or having to move through 3 levels of living when mobility becomes a challenge.
4. A New Chapter
If you’re considering downsizing now versus maybe waiting a few more years to see how things go, it would be better to do it sooner rather than later. Retirement is a whole new life for you; it is an exciting and sometimes even scary chapter of your life, where you will establish entirely new routines that do not revolve around working, new interests and activities that will fill your life. Starting this next step by downsizing your home will allow you to shift your mindset into this new stage of your life. It may be more difficult to downsize years after your retirement because it will force significant changes in the routines you have established as a new retiree, especially if you’re planning on moving out into a different area. What that really means is that 5 years post-retirement, it’s very likely that you established what you like to do with your time through activities that you participate in, social gatherings, your preferred stores for your errands, and your local social circle. Making the move to downsize 5 years post-retirement would be much more difficult on your well-being because it would interrupt everything you’ve created to enjoy.
Downsizing: How to Get Started
Moving from a larger to a smaller home really means that you have to reduce the number of things you own, because unfortunately, you cannot fit the contents of a 3,000 square foot home into one that’s 1,500 square feet. Here are some tips to get you started:
- Start paying attention to what items you use on a daily basis; likewise, pay attention to things you haven’t touched in months or even years
- The things that you haven’t touched in years would be the first to consider getting rid of by selling, donating, or disposing of.
- Start small by tackling a specific area, not the whole room. For example, go through your linen closet only; that way, it’s achievable, and you feel accomplishment once it’s completed, which gives you the positive boost to move on to the next area.
- When tackling areas that are filled with things, get three bins and label each one with 1. Keep 2. Sell/Donate 3. Garbage and sort the items as you go through them
- Invite friends to help and incentivize with fun refreshments, appetizers, and quality time, and who knows, they may even help take a few things off your hands!
Remember, downsizing your home for retirement doesn’t have to feel overwhelming. Retirement is something that you have worked so hard to reach, and you’re finally here, so let’s make the best of it. Contact REMAX today and let us help you guide you through this new and exciting chapter of your life.
