Is it smart to downsize? Moving to a smaller home to save money comes with some trade-offs. Downsizing can reduce some expenses, including your mortgage payment, utility bills and, of course property taxes. I’m sure you have your own reasons but before you make the move, a lot of work needs to go into downsizing, including the tedious process of deciding which of your items to keep and which ones to give away. It is not easy to dispose of things that you collected over all these years. That process can be painful but it can also be liberating. Many actually said that after moving into a smaller home they became happier. Why, when living with less means you are cutting down on many things you were used to? Well, here are some of the reasons.
First, downsizing means less work. Since you’ll be living in a smaller space you’ll be having less to work on. Those 2-3 hours you use to mow lawn can be reduced into 30minutes to an hour so basically, it gives you time to work on other things that matter instead of doing cleaning and all the stuff maintaining the house.
Second, you'll spend less on your mortgage payment. you are likely to have more money left in your bank account every month to allocate for other needs or desires. So, you’ll have increased cash flow. Or perhaps you could pay cash for a smaller home from the proceeds of your existing home.
Third, downsizing means letting go of unnecessary things. This means you have to let go some things and keep only the items that you need. Value of those items to you, the size and if you can put it in use are the factors to consider when deciding what to keep and what to let go.
Fourth, save energy when downsizing to a smaller home. From heating and cooling costs to water savings in your bathrooms and kitchens, it costs a lot to run a large home. With smaller homes you will enjoy a lower energy bill.
Fifth, smaller home will help you keep on a budget and shopping sprees will be curbed because there isn’t much room to store new additions! If you are trying to save money and keep your credit from going into the red, consider downsizing your home – your future will thank you for it.
Lastly, travelling can often be a burden when you have a large home but if you decide to downsize travelling can be less of a hassle when you need to leave your home for extended amounts of time, especially if you downsize to an apartment or condominium unit from a stand-alone house.
It's a Joint Decision
But before buying your new house or condo suite, be sure that you and your partner are in it together. Discard the big items and take the small things with you.
Keep any item you currently use or use seasonally. Also, keep items with sentimental value or a practical purpose, even if you don’t use them regularly. I know how tempting it is to hang onto items you once loved but no longer use or items you think you might use someday.
But the truth is if you haven’t used a particular item in the last year, you’re unlikely to use it in the next year.
Be realistic and ask yourself what you use and what you need, both now and in the future. Find a new home for special items. How you do it is a personal decision, but if the item holds meaning to you, try to keep it in the family or with friends who understand the meaning behind the item.
Here is an example
Not too long ago, my client Natalie was considering a move from her semi-detached house. When I sat down with her to discuss, she told me that her husband had passed away a few years ago and she was finding it difficult to maintain the house and also make monthly mortgage payments.
Natalie preferred not having a mortgage loan at all if that was possible. We found her a condo which was much closer to her work.
The sale proceeds from her house fully paid for the purchase price of this new home. Her monthly costs are way down and she was very happy to be mortgage-free.
We all have our reasons in downsizing and whatever that is I hope it works for you. Downsizing may look practical but it may not work for everyone. But if it works for share with me what prompted you to move and how it is going!
If you are looking to downsize your home, I will be happy to help. Call me at 647-834-9928 or send me an email to [email protected].?