Is home downsizing a good move for you? Perhaps your kids have moved out. Maybe you don’t have children, but you have space to spare. Or you possibly just need more breathing room in your budget. Whatever the reasons, scaling down to a smaller home can bring in big benefits.
Increased Cash Flow
Whether you have paid your mortgage off or not, downsizing can put more cash into your pocket. A smaller, less expensive home means that your mortgage will be much smaller—or non-existent if you can buy the home outright. Less living space usually costs less to heat, so your utility bills should come in lower as well. You can use all of that extra money on vacations, a new car, or anything else you couldn’t afford before.
The savings from downsizing can give you enough budget to pay off your mortgage and other debts sooner. Say you still have a car payment or a student loan. Taking the extra cash and using it to pay those loans off will save you paying interest on long-term loans. Putting the money you save on housing to work can pull you out of debt altogether.
Extra Retirement Savings
You could also use your downsizing savings to invest in your retirement fund, which will pay dividends down the road. Depending on how far away from retirement you are, you could double, triple, or even quadruple the value of your downsizing savings by investing it. Downsizing to a smaller home and saving more could help you to enjoy a more comfortable retirement lifestyle.
Downsizing to a smaller home and saving more could help you enjoy a more comfortable retirement lifestyle.
“Time is money,”, as they say, and most people never seem to have enough of either. Downsizing to a smaller home can help you find a little more time in your day. Smaller homes require less time for upkeep, giving you more free time to spend on things that matter to you. Not having to do as much maintenance on your home will probably cause you less stress too.
Reduced Environmental Footprint
A smaller home consumes less energy. Not only does this save you money on your utility bill, but it also helps lessen your impact on the environment. Smaller homes tend to be older homes, so often downsizing can be seen as “house recycling”. If lessening your environmental footprint matters to you, a smaller house will go a long way in that endeavor. Home downsizing is a big decision. If you can adjust to the changes that come with a smaller residence, that big decision could lead to a big payoff. You could have more cash, less debt, more savings, less maintenance, and a reduced environmental impact if you take the leap and downsize.
Ready to downsize?
Speak to a Loan Officer today!
Sources www.thebalance.com www.ptmoney.com www.money.usnews.com