[TOP] 10 Reasons Not to Downsize Before You Retire - Simple Money Tips for Women (2024)

29 Dec 10 Reasons Not to Downsize Before You Retire

Posted at 13:15hin Money and Your Partner, Pensions and Retirement, Saving and InvestingbyAdmin

10 Reasons Not to Downsize Before You Retire

While some people cannot wait to downsize to a smaller house when the kids are on their own and retirement is approaching, downsizing isn’t right for everyone. There are many factors to consider before you decide to sell your home and opt for something smaller. If you still owe a considerable amount on your home and want to try to pay it off, you may want to put off selling. No matter what your reasoning, here are some things to think about before you decide to downsize when you retire.

#1 Less space to entertain.

People often forget to consider how having less space will impact their social life. For example, if you downsize when you retire, you won’t have as much room when the kids and grandkids come over to visit or for holiday gatherings. If you enjoy having company over, there’s nothing worse than not having enough space and everyone feeling cramped. While you can always host events at a rented facility, it’s just not the same as having people over to your own, spacious house.


#2 Maybe a smaller house is too restrictive for your comfort.

If you’re used to having lots of space in your home, you could feel very restricted and uncomfortable with less space. And in a smaller home, you may be forced to get rid of your furniture because it’s not conducive to the space. (This, of course, is an added expense.) You certainly don’t want to downsize and then find out that you hate feeling so confined in a smaller house.

#3 This may not be the right time to sell.

Timing is everything. And depending on the housing market and what’s going on in your personal life, it may not be the right time to sell. If you have too many things going on in your family, business, or health, the last thing you need is the stress of selling your house, finding a new house, and packing up everything to move.


#4 Less storage space.

Many people don’t think about how downsizing their home will mean downsizing their stuff too. If you’re a sentimental person and find it difficult to let go of things that bring you happy memories, then you may not be ready to downsize your house. If you can’t let go of some things, you may need to rent a storage facility while you live in your smaller home. But this will be an additional cost each month that could be avoided if you stay in your larger home, right? Either way, you’ll need to do some soul-searching and be honest with yourself about this before you make a decision.


#5 You are not ready emotionally to make the change.

Many people are surprised by how emotional they can be when deciding to downsize after retirement. After all, if you’ve been in your home for decades and raised your family there, you are saying goodbye to many beautiful memories. If it’s too hard to imagine leaving these memories behind—if you look forward to making memories in the same house that you raised your own kids in—then maybe you aren’t emotionally ready to downsize.

#6 Moving costs – nobody likes moving.

While downsizing to a smaller home can save you money as far as mortgage payments go, you can’t forget about all the costs associated with moving, packing, and closing. Often, there are unexpected costs too. For instance, maybe in order to sell your house, you need to put in a new furnace or replace the roof first.

Many people choose to rent before buying another home, but if they do that, they lose the tax advantages of owning a home. All of these costs add up quickly, and many people aren’t prepared for the extra costs that come up when selling their house.


#7 Change is difficult.

If you’ve lived in the same home for a long time, selling it and moving to another location could be very difficult emotionally. You’ll be leaving memories, neighbors, and friendships behind; and depending on where you move to, you may not be able to maintain these relationships. Moving means you’ll be leaving everything familiar; you will have to find new places to shop, dine, and bank. You may have to find a new doctor and a new church too. The changes are seemingly endless.

#8 New neighbors, yikes!!!

Let’s be honest. If you have great neighbors, you need to count your blessings. Downsizing means you’re rolling the dice and taking your chances; you may not end up with decent neighbors again. Is that a chance you’re willing to take? Only you can answer that question. You may also feel anxious about making new friends in your new location and wonder if you’ll be welcomed or shunned.

#9 Too much stress to move.

Whether we acknowledge it or not, it’s stressful to move. From dealing with the bank and the closing process to letting go of sentimental objects and packing up your whole house, there’s lots of stress almost every day. There are so many things to coordinate and take care of in addition to closing your bank account, transferring your medical records, and saying goodbye to friends. Sometimes, downsizing just isn’t worth the stress.


#10 Loss of status symbol.
Some people really feel like their house is a symbol of their status or success. If you downsize and live in a smaller home, will you be concerned about people’s opinions of you change? If this bothers you, then maybe downsizing isn’t the best choice for you, and that’s okay!

As you can see, there are many things to consider before you downsize after retirement. You certainly don’t want to rush into a decision you’ll regret just because others you know are doing it. Choosing when or whether to downsize is a very personal decision that you need to make for your unique situation and experience. Remember: you’re the one who has to live with your decision. So make the decision you want to make; don’t base it on what others think or want for you.

[TOP] 10 Reasons Not to Downsize Before You Retire - Simple Money Tips for Women (2024)

FAQs

At what age do most seniors downsize? ›

This question has no definitive answer, as it depends on individual circ*mstances and lifestyle. However, research suggests that many people contemplate downsizing as they approach retirement, typically around their late 50s to early 60s. A Zillow report found that on average, most people who downsize are 55 years old.

What is the best age to downsize your home? ›

The responses find people believe 66 is the ideal age to downsize as they reassess their lives and plan for retirement. If you're planning to sell your home and purchase a smaller property in the future, there are positive reasons to do so, including these three.

Should you downsize before or after retirement? ›

Downsizing before or during retirement can help you save and stretch your retirement dollar. Convenience – You're not alone if you're tired of doing all the housework and maintenance for a larger home. Many downsizers switch to smaller homes where the upkeep is less expensive and taxing.

Is there a downside to downsizing? ›

The downsides of downsizing

Less living and storage space. You might want to keep a larger home that gives you plenty of room for hobbies, storage and anything else that comes up. Leaving a neighborhood you enjoy. If you've been long-time friends with your neighbors, you may not want to leave.

How do I know when it's time to downsize? ›

You may need to downsize when you have challenges maintaining your home. Common examples of doing so include empty nests, retirement and health changes. You may want to talk to a financial advisor before downsizing to make sure your unique needs are being met.

At what age do most seniors need care? ›

Seniors over 70 who need assistance with two or more daily activities qualify for assisted living. Here is a breakdown of the average age of seniors in assisted living according to a Consumers Affairs report in 2021: The average age of seniors in assisted living is around 84 years of age. 52% of residents are over 85.

How to sell furniture when downsizing? ›

Best Place to Sell Things Online
  1. Online Auction Sites. ...
  2. Amazon. ...
  3. eBay. ...
  4. eBid. ...
  5. Etsy. ...
  6. Bonanza. ...
  7. Craigslist. ...
  8. Facebook Marketplace.
Aug 28, 2023

Should you sell your house and downsize? ›

There's no question that downsizing can have many financial advantages. A smaller house can mean less upkeep, lower monthly expenses—and maybe even potential cash from a sale. But before making a decision, it's important to assess how taxes could play a part.

What is the 25 rule for housing? ›

To calculate how much house you can afford, use the 25% rule we talked about earlier: Never spend more than 25% of your monthly take-home pay (after tax) on monthly mortgage payments. That includes your mortgage principal, interest, property taxes, home insurance, PMI and HOA fees.

What not to do when downsizing? ›

Don't Make These Common Downsizing Mistakes
  1. Downsizing Without Having a Plan. ...
  2. Failing to Make an Accurate Budget. ...
  3. Taking Unnecessary Items With You. ...
  4. Moving to an Area That Doesn't Suit Your Lifestyle. ...
  5. Failing To Stick to Your Schedule. ...
  6. Focusing on the Negative Aspects.

What to do first when downsizing? ›

Here's what to do.
  1. Clean One Room at a Time. Decluttering an entire home becomes more manageable when you break it down into smaller steps. ...
  2. Sell or Donate Unwanted Items. You have three main options for disposing of things you no longer want or need. ...
  3. Set Up Decluttering Rules. ...
  4. Consider Your New Space.
May 14, 2024

What is the best size home for retirement? ›

And if you ask us, the perfect size for a retirement home is 1,500 square feet.

What is a potential drawback to downsizing? ›

What Are the Disadvantages of Downsizing? Some companies may try to downsize as a way to reduce expenses, especially if they are facing a cash crunch. However, they run the risk of losing employee loyalty and valuable institutional knowledge.

Is downsizing financially worth it? ›

Downsizing your home in retirement can reduce your housing expenses including mortgage payments, property taxes, insurance, and maintenance costs. Additionally, a smaller home often means less upkeep and maintenance, freeing up time and resources for other retirement pursuits.

What are some of the drawbacks to downsizing? ›

Disadvantages of Downsizing Your Home
  • Mortgage Costs. If your current home is paid off, you might be able to sell it and buy a new home outright with the profits. ...
  • Costs of Buying or Selling a Home. ...
  • Moving Expenses. ...
  • Potential Fees. ...
  • Possible Storage Costs. ...
  • Limited Work-at-Home Options. ...
  • No Extra Space. ...
  • Lifestyle Creep.
Jul 7, 2022

What percentage of retirees downsize? ›

What percentage of retirees downsize?" According to SeniorLiving.org, "Roughly 51 percent of retirees ages 50 and over move into smaller homes after retirement."

What percent of seniors want to age at home? ›

92% of older adults surveyed prefer to live out their later years in their current home, while 8% said they would prefer to live in an assisted living facility.

What is downsizing after 50? ›

Moving to a smaller, more manageable home as you grow older is known as downsizing. Exploring the financial, social, and safety outcomes of downsizing is crucial before you make the decision to move. Safety modifications are essential for aging in place and can be added to your current or new home.

What decreases in older adults? ›

What's happening. With age, bones tend to shrink in size and density, weakening them and making them more susceptible to fracture. You might even become a bit shorter. Muscles generally lose strength, endurance and flexibility — factors that can affect your coordination, stability and balance.

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