Many people look forward to retirement when they can spend their days relaxing, traveling, and enjoying their hobbies. For some retirees, downsizing to a smaller home is a smart financial move to help them enjoy a better retirement lifestyle. Retirees choose to downsize for many reasons. Even if it’s the right decision for you, it’s important to remember the logistics involved with downsizing, including deciding where to live and budgeting for the move.
Reasons for Downsizing to a Smaller Home
Consider some of the most common factors that influence a retiree’s decision to downsize to a mini home.
Fixed Income
Many retirees have a fixed income lower than what they made while they were working. Downsizing house is a great way to reduce monthly expenses and make it easier to live within a set budget.
Limited Mobility or Health Concerns
As you reach retirement age, you may find it more difficult to navigate your large house. Moving to a single-story home or somewhere with fewer stairs in general makes it possible to maintain your independence without sacrificing safety. The proximity to and quality of nearby hospitals may also be a priority if you have health concerns.
Less Cleaning & Home Repair
Another benefit of downsizing is the convenience of less housework. Living in a smaller home also reduces the need for expensive repairs and renovations, which can be significant expenses for larger homes.
Desire to Travel
Without work tying you down, retirement is often viewed as the ideal time to travel. The lower housing costs that result from downsizing can make this possible. With fewer expenses tied up in a mortgage, property taxes, and maintenance costs, you can put more money towards traveling. It’s also easier to leave your home for extended periods without worrying about maintenance or repairs.
Lifestyle Changes
In addition to travel, downsizing also frees up money to help you enjoy a better quality of life, whether that means meaning funding hobbies, dining out, or splurging on gifts for loved ones. Plus, with less time spent maintaining a smaller house, you have more free time to pursue your passions. You might even downsize to a smaller home closer to family for more quality time with your children, grandchildren, and other loved ones
Plans to Retire Out of State
If you’re thinking about relocating to a warmer climate, you’re not alone. By selling a larger home in a more expensive state and purchasing a smaller home in a less expensive state, you can stretch your retirement dollars further. Downsizing makes it easier to relocate, as a smaller home requires fewer furnishings and decorations.
Deciding Where to Live
As a retiree looking at downsizing house, you must consider where you want to move. Some retirees prefer to stay in their current city, while others choose to retire in a new state or even a different country. The location you choose impacts the cost of living, taxes, and access to healthcare, so carefully consider all these factors when making your decision.
You also have various types of properties to choose from. Each option has benefits and drawbacks, so the choice depends on your lifestyle preferences, health, and budget. For instance:
- Single-family homes offer more privacy and outdoor space but may require more upkeep.
- Condominiums and townhomes typically have less maintenance but usually come with monthly HOA fees.
- Retirement communities may offer social activities and amenities for seniors, but the cost of living may be higher.
Budgeting for a Home Downsize
While downsizing can save money in the long run, there are still costs associated with selling a larger home and purchasing a smaller one. Budget for these costs to ensure you can afford the move.
Costs of Selling
When selling your existing home, you must factor these costs:
- Home repairs and upgrades needed before you can sell
- Your real estate agent’s commission, which is typically 4 to 6 percent of the sale price
- Closing costs, which can come to thousands of dollars
- Mortgage payoff penalties, which might apply if you haven’t paid off your house yet
- Capital gains tax, which the government charges for the sale of real estate and other assets
Costs of Moving
Moving to a new home also comes with costs, which vary depending on the distance of the move and the type of home you downsize to. These include:
- Buying moving supplies
- Hiring movers
- Paying for storage
- Shipping your car
- Buying new furniture or appliances
- Other incidentals
Intangible Costs
Downsizing can come with intangible costs, such as possibly ending up far away from friends and family or losing relationships with your current neighbors. While these costs don’t have a direct financial impact, they can still affect your quality of life and should be accounted for when deciding to downsize and choosing a location to live.
Downsize to a Smaller Home in Texas
Overall, downsizing as a retiree offers many benefits. With careful planning and a positive attitude, moving into a smaller house can improve your lifestyle and open up new and exciting opportunities.
Choose Firefighting’s Finest Movers & Storage to help you relocate from your large home to a smaller one. We have over two decades of experience and are accredited by the Better Business Bureau, so you can trust us to help you on your downsizing journey. We strive to SERVE every customer with Safety, Excellence, Relationships, Value, and Ethics. Our crews are based in Fort Worth, Dallas, Austin, and Houston, with the ability to accommodate moves between these locations and beyond. For more information, please contact us at (817) 737-7800 or request a moving estimate online.
