Downsizing your home for retirement
To be clear, downsizing in retirement doesn’t mean moving into a retirement village or long-term care facility. It’s about finding a place that better suits your current needs as opposed to the needs you had 25 years ago. There are a lot of possibilities – many choose apartment-living or a smaller house closer to a town with all amenities on your doorstep. Here are some other good reasons for downsizing:
Unlock equity in your home
Your home may be your biggest asset, but its value may be under-utilized if you’re living in a house that is larger than you need. Selling your home is one way to unlock the equity you have built up and make it available for use.
Lower your utility bills
The larger your property, the larger your utility bills are likely to be. This is an ongoing expense you could reduce by downsizing.
Avoid health/safety emergencies
As people get older and start to have trouble getting around, their homes may pose risks to them in the form of steep stairs, slippery bathroom surfaces, etc. These risks are exacerbated if you live far away from emergency help. Moving to a property that is easier to navigate and closer to medical aid could help keep you safe.
Reduce property taxes
Property taxes are generally assessed as a percentage of the property’s value. Move to a less expensive home and you can reduce this ongoing expense.
Save on routine travel
When you bought your house, you may have focused on how close it was to things like schools and your job. Once the kids leave home and you retire, a more convenient location would be one close to shopping and services you routinely need.
Cut down on repairs/maintenance
Any homeowner knows that property comes with regular needs for repairs and maintenance. Cut the size of your property and you can cut the number of bills. Switch from owning to renting and you can avoid most of these expenses altogether.
Pay for fewer services
It may be a lawn service, house-cleaning, or perhaps something else, but, if you are regularly paying for help keeping up with your property, this is another way you can save money by downsizing.