SELLING YOUR HOME AFTER RETIREMENT: THE BENEFITS OF DOWNSIZING

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D. Gates Wealth Management

Posted on

Mar 16, 2023

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Florida - Southwest

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If you’re nearing retirement age, you’re probably thinking about what life will look like once you’ve stopped working full time. There are many benefits to retiring—like more time to spend on your hobbies and with people you love—but there’s also the uncertainty of living on a fixed income. One great way to save money during retirement is by moving to a smaller home. Here are some of the benefits of downsizing. 

REDUCE YOUR MORTGAGE BURDEN 

If you’re still making mortgage payments after retirement, downsizing may be a good idea to lower your monthly payments, or maybe even eliminate your mortgage completely. Reducing your mortgage burden means you’ll have more funds to dedicate to other expenses. 

When thinking about downsizing, be sure to consider how much equity you have in the home, what the housing market looks like at the time and how long you might stay in your new home. If you’ve already paid off your mortgage, it may make sense to stay where you are, or you may decide to make a profit off of the sale of your home. 

CUT DOWN ON BILLS  

Smaller homes also come with reduced utility costs. You’re paying for every inch of unused space in your home through heating and cooling, electricity, gas, water, and even internet access. The smaller your square footage, the less space you have to heat and power in order to live comfortably. 

With a smaller living space, you can also cut down on costs like lawn care and cleaning services. Larger homes require more maintenance and general upkeep, so by downsizing you can cut those costs, or even eliminate them altogether. 

REDUCE SPENDING ON FRIVOLOUS ITEMS 

Besides the required expenses to keep your home in a livable condition, you may be spending money on expenses like furniture, art or other home decor items. In a larger home, you’ll have room to fill with unnecessary items, but downsizing will force you to live a simpler life. You’ll have less room to decorate and fill with furniture, so you’ll likely spend less on excess decor. 

LIVE IN A LESS EXPENSIVE LOCATION  

Your job may have been in or near a major metropolitan area but once you retire, you won’t be tied to that location for work. Looking for a less expensive location with a less expensive cost of living when you downsize is a great way to maximize the money you spend on a new home. Even if you’d like to stay close to family and friends, you’ll have the flexibility to look for homes that may be a bit farther away now that you don’t have to worry about a commute. 

If you’re open to living in a different location entirely, you may want to do some research on locations with low costs of living. Having a smaller home in an area with a low cost of living will leave you with more funds to do the things you love and take advantage of all the free time you have during retirement. 

IMPROVE HOME ACCESSIBILITY 

Another important advantage to downsizing is being able to buy a home that’s accessible as you get older. You may not have mobility issues now, but you may develop them in the future. Instead of worrying about how to finance a home renovation to fit your accessibility needs down the line, downsizing allows you to buy a home that’s already fit for whatever may come in the future. Look for homes with minimal stairs, wide doorways, and open floor plans. 

 

Thinking about moving can be daunting, especially if you’ve spent many years in your current home. If you’re wondering whether downsizing is right for you, talk with a financial professional to make a plan to fit your needs in retirement. 

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Local Services By This Author

D. Gates Wealth Management

Financial Services 1708 SE 47th St #2, Cape Coral, Florida, 33904

For over 20 years, Danielle has been helping professionals and their families gain a sense of clarity and confidence about their financial future. She is driven by her desire to help people turn their complicated and often overwhelming financial pictures into goal-based, comprehensive wealth management strategies that they can feel good about. Danielle's commitment to helping her clients navigate their financial lives has served as the foundation for her financial services practice, D. Gates Wealth Management. Danielle Gates is a Certified Financial Planner and her personal goal is to be a lifetime resource for each and every client. In her free time, Danielle enjoys pedaling her bike through local trails and beaches, hiking, and traveling.

D. Gates Wealth Management

Financial Advisor 1708 Southeast 47th Street, Cape Coral, Florida, 33904

We, at D. Gates Wealth Management, along with LPL Financial, are dedicated to helping our clients make informed financial decisions about issues that affect their financial needs, goals, and objectives. We strive to help clients to create a sense of financial well-being toward pursuing financial freedom. Additionally, we work with clients to determine what is important in their lives be creating a comprehensive financial plan centered around their values.Whether you're just starting out or you've already built a strong financial foundation and want to know what's next, D. Gates Wealth Management can help you take the next step.COMPREHENSIVE FINANCIAL PLANNINGCash Flow PlanningInvestment ManagementRetirement PlanningSocial Security OptimizationEducation FundingInsurance & Risk ManagementTax Management PlanningEstate PlanningINVESTMENT MANAGEMENTRisk AnalysisInvestment Policy DevelopmentTax Management PlanningPortfolio ManagementBUSINESS PLANNINGRetirement PlanningGroup BenefitsProfitability AnalysisSuccession Planning