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Is it time to downsize your home?

August 07, 2018 by Justin Morgan
Is it time to downsize your home?
August 07, 2018
by Justin Morgan

Once an active household, the home seems empty and used much less now that the kids have entered adulthood and left home, achieving their independence.  Over the years, the house may have seen the kid’s rooms transform from a nursery, to a toddlers play haven, into an adventurous child’s theme, to a teenage retreat, and then to a college students resting place between classes and semesters.  The busy rooms have since become quiet, and hence the term “Empty Nesters”.

Perhaps you’ve been thinking of downsizing, to allow yourself more time to pursue interesting and enjoyable activities, rather than spending time maintaining a home that isn’t fully used. Your friends, siblings, family members, and neighbours may be well on their way in downsizing, reducing their space, as well as their belongings. They may have found a suitable place to live, in an area the suits the lifestyle they desire.

That could be you!

Reducing your belongings and living space will reduce your responsibilities, mentally, physically and financially, lightening the burden of maintaining a home. Downsizing can free up funds for your retirement and reduce day-to-day expenses, but do the pros outweigh the cons? It’s not always the right decision, which is the reason to think it through.  Plan every detail transitioning between homes, and think through every financial outcome. Before you make the decision, you need to know with assurance that you’ll have enough money to meet your retirement goals if you downsize.  If not, then you can look at how the plan can be modified. The services of a financial advisor may be needed to draw up a financial plan that outlines your finances. Everyone’s situation is unique, and the reason that one wants to downsize is important. If it’s to build a nest egg, selling a million dollar home and purchasing one in the $400,000 range would free up equity, however selling a $500,000 to downsize to a $400,000 home would not leave much funds after realty and legal fees.

Many downsizers will have sentimental value invested into the home, and the emotional attachment cannot be overlooked. Be prepared to leave what you once had, and look forward to a new beginning.  That goes with your furnishings and personal belongings as well. Downsizing will mean that the rarely used items that you own will have to go, either given away or sold, as there likely won’t be enough space in your new dwelling for all of your belongings. A self-storage unit can be considered for those items that you simply can’t part with, that hold sentimental value, or cannot be replaced.

Once you’re sure downsizing is the right decision, and you’re ready and committed, and your plans are air tight and concrete, you’ll wonder why you didn’t start long ago.  Good Luck!