When Is It A Good Idea To Downsize Your Home
Owning a big beautiful house is a common dream shared by numerous Americans, and once you’ve raised a family in a home, it can be painful to think about moving. There are, however, several situations that make downsizing an attractive idea. If your home has started to feel too big, or it costs too much to upkeep, it might be time to think about a change.
When Should You Downsize Your Home?
The big question about downsizing is: when should you do it? You never know when having a little extra space might come in handy. The important thing is to understand both the practical and emotional considerations at stake. It’s okay for the right time to be “whenever you feel ready,” but that doesn’t mean there aren’t good practical reasons to start thinking about downsizing and getting used to the idea now. This is, after all, a decision about you and your family. As such, it should be based on both the quality of life and the general happiness of you and your loved ones.
When Downsizing Makes Financial Sense
It’s an unfortunate truth of the current economy; home prices are increasing faster than wage growth can keep up with. For many people, this means not being able to buy a home in the first place. Sometimes, someone might buy a house and discover later that the size of the mortgage payments is no longer manageable.
On the other hand, as inflation increases, a house could become too expensive to upkeep. It’s also possible that a sudden medical expense or other disastrous life event causes extreme financial stress.
This is perhaps the most distressing and unpleasant reason to downsize. It’s also, unfortunately, one of the most substantial reasons. Not being able to afford the size of your home, while a devastating realization, needs to be addressed and corrected as quickly as possible.
Signs that you may need to downsize for financial reasons include:
- High/increasing amounts of credit card debt used on everyday expenses such as food.
- Unexpected significant expenses, such as medical bills that require you to take out additional loans.
- Trouble funding mortgage payments with your budget.
When You Want to Travel More
On to a brighter, more pleasant reason for thinking about downsizing. If you’re a jet setter and spend a lot of time traveling each year, whether it’s for business or just because you love it, downsizing is a good idea.
The more time you spend away from home, the less you need all of the space it provides. Your home and all the things inside it might become less necessary to living a full and joyful life. You still want somewhere comfortable and homey to return to after your travels, but it doesn’t have to be huge. After all, it won’t be long before you’re on your next adventure.
The other advantage of downsizing is the cost. A lower mortgage and lower upkeep fees can allow you to save more aggressively for your trips abroad. If you’re worried about storage space, remember that it’s likely more cost-effective to downsize and then put extra things in storage while you’re away. When you come back, you can grab what you need from storage, and have a safe place to put it when you leave again.
For a Minimalist Lifestyle
Embracing a lifestyle of simplicity and minimalism is becoming extremely popular. Perhaps it’s as a reaction to the always connected, always-on-the-go culture of cities and the expectations of modern careers. Whatever the reason, people are choosing to downsize, load up into spaces as small as 500 square feet, and take their lives on the road or out into the wilderness.
You don’t have to go quite that far to embrace minimalism. It starts with deciding you want to live with less, useless, and recycle more. Many people are finding that reducing the number of things they own and rely on is a critical key to living more happily. Downsizing your home is a great way to achieve this because it forces you to aggressively remove unnecessary things from your life which you simply do not have space for.
None of this means you have to get rid of anything that makes you happy. If you really want to live a more minimal lifestyle but you also have an extensive wine collection, for example, you don’t have to give it up. Simply take it to a temperature controlled storage unit, and you can still access it anytime you want. This goes for an extensive collection of, or singularly bulky, item or items that mean a great deal to you.
Your kids are adults now, leading their own lives, perhaps buying homes of their own, getting married, and maybe even giving you grandchildren to spoil rotten. This is one of the best times to start thinking about downsizing, as you look toward a future that is filled with the joy and culmination of everything you’ve been working so hard for.
Of course, it can be naturally challenging to consider downsizing at this point. Your home has memories, and it means a lot to you and your families. There are, however, good reasons to downsize, and it’s important to remember that all the love and beauty your home reminds you of aren’t the things you’re getting rid of.
For those who ultimately do wish to benefit from a more minimalist existence during retirement, there are many benefits to reap. Downsizing after you retire can help you to manage on a fixed budget, for example; the money you gain from selling your home and buying a smaller one can be used to assist with your retirement income.
There’s also the consideration of size, upkeep, and stairs, as it becomes more difficult for you to get around in your old age. Stairs often represent a hazard to seniors, and nobody wants to live in a house that requires so much upkeep that you spend all your time doing chores...
If your retirement coincides with a shift toward a snowbird lifestyle — traveling south or to warmer climes for the winter — then downsizing your home can make it easier to own and maintain two households through the seasons.
When is Downsizing a Bad Idea?
It may not always be the right time to downsize. Many considerations go into the timing of a downsize; here are a few:
When Your House Is Appreciating Quickly
If your home is gaining value at a rapid pace, it might make sense to wait before downsizing/moving. Neighborhoods in newer areas of town often see homes appreciating in value at impressive rates, especially if there is a new development, investment in local public services and schools, or an influx of business to the area. Under these circumstances, it often makes sense to wait awhile, at least until the price climb levels out, and then to sell when your home is worth more.
When You Have Many Guests
Do you love to host? Whether it’s having friends over for a quiet dinner or significant events, prolific hosts can benefit from extra space, even if they don’t always use it themselves. Just because the kids have moved out doesn’t mean that spare room is going to waste — at least not if you love to have people at your home.
If hosting makes you happy, or if your home is known as the “go to” for events among family and friends, then downsizing may not be right for you.
Before Your Kids Have Started Careers
According to CNBC, nearly 23 percent of millennials live with their parents. The high housing cost vs. low wage growth issue mentioned earlier is having a considerable effect on the millennial generation, who leave college to find a job market that doesn’t reward them for their education.
It’s an unfortunate circumstance, and it means that chances are high that your college-age kids will need to move back in with you, at least for a little while, after they graduate. So, just because they’re off to college doesn’t mean you’re an empty-nester yet. It might make sense to hold off on downsizing until they are settled comfortably into their careers — and their own spaces.
Downsizing is, in the end, an extremely personal decision. Some people find excitement and catharsis in leaving the big family home behind and starting a simpler life. Others find it difficult to part with the meaning they cultivated inside of and attached to a home. These are both valid emotional responses and exemplify why a decision like this is necessarily more than practical.