Every year, people around the country move into smaller living spaces for a wide variety of reasons. Whether it’s downsizing to a rental property or selling a home to move into a smaller one, downsizing can offer a lot of benefits. Most people downsize as part of a financial decision, since a smaller space often means lower costs. Many of the other reasons for downsizing can also be directly or indirectly related to finances. Use this guide to find out the common reasons for downsizing, determine whether or not you need to downsize, and ways to make downsizing simpler.
Common Reasons for Downsizing Your Home
- Lower monthly costs— The main reason that most people downsize is to increase the spendable income every month by lowering their rent or mortgage payments. A smaller home is a great way to decrease the biggest part of your budget so that you can save money in other areas, such as:
- Taxes: In a smaller house, you’ll pay significantly less in real estate taxes. Not only will you decrease your mortgage payments, but you’ll also be able to decrease other major costs as well.
- Utilities: Going from two water heaters down to one can be a great money saver. Even if your downsize isn’t that drastic, heating and cooling a smaller space is far more efficient and costs a lot less.
- Maintenance: A smaller home will be a lot more affordable to maintain, especially in the long run. For example, if you ever need to install a new roof or paint the exterior, having a smaller home will reduce the total cost of replacement.
- Move to a better location— Many people will sacrifice square footage to live in their ideal neighborhood or in a downtown space. While the need to downsize can be related to higher costs in that area, these people are mainly driven by their love for a specific location.
- Don’t need that much space— Empty nesters will often be left with more house than they need once all of their children have grown up and moved out. Moving into a smaller home can be much more convenient for maintenance and a new lifestyle.
- Newer but smaller — Larger isn’t always better. Some people will sacrifice some space to move into a better or more modern home because they value amenities over space.
- Smaller footprint— As people are becoming more interested in preserving the environment, many have chosen to minimize their ecological footprint by living in a smaller home. In that case, downsizing is not only a housing choice, but a lifestyle choice.
- Sometimes it isn’t an option— Unfortunately, downsizing isn’t always an option. A recent divorce or sudden unemployment scenario can force people to downsize their living arrangements in order to afford rent or mortgage payments.
Should You Downsize Your Home?
Moving into a smaller home is a very big decision, so it requires a lot of planning and foresight to make sure it’s the right move. Just because there are a lot of benefits to downsizing, that doesn’t mean that it’s right for everyone. While many instances of downsizing are based on necessity, some decisions are made based on future goals and the willingness to sacrifice square footage for the ability to invest more money elsewhere.
If you are debating whether or not downsizing is right for you, here are some things to consider:
- Does size matter to you?— This is a simple question that you should ask yourself before you consider anything else on this list. If the size of your home doesn’t matter to you, then you should reconsider downsizing. If you value a high square footage layout, explore other options to decrease your monthly expenditures before making the decision to downsize your living space.
- Will it ease your financial situation?— Another simple question that will help you decide if downsizing will actually be beneficial for you. If you can help your financial situation by moving to a smaller place, then it is definitely a worthwhile decision.
- Overall cost of downsizing —This is an important aspect to consider in the total cost of moving, even when you’re going to a smaller place. You may have to buy entirely new furniture that fits your new space better, and getting rid of belongings can be considered a “cost” as well, albeit not monetarily.
- Do you like the neighborhood/area?— Any time you move, you have the opportunity to live in a neighborhood you really enjoy. When downsizing, your list of options increases significantly. Neighborhoods that were once out of your price range, like downtown condos or apartments, are much more affordable when you’re looking for a smaller size.
- Is it the right house for you?— You want to make sure that you’re making a decision that you’ll love. That means the criteria for your new home has to be much more complicated than just being smaller. You don’t want to sacrifice happiness, just space.
How to Make Downsizing Easier
Now that you’ve decided that downsizing is the appropriate step for your life, it’s time to start focusing on how you can make it easier on yourself. In most cases, it’s fairly difficult to make the transition from a larger living space to a smaller one. It’s a lot like trying to pack too much into your carry-on suitcase. It can leave you with making big decisions on what should be kept and what won’t be making the move with you.
- Take inventory of your belongings— The first step of downsizing is to take a thorough inventory of everything that you own so you can figure out what you really need and what you can part with. Categorize your belongings to figure out must-have items and items you can replace with smaller sized counterparts.
- Don’t duplicate items— When downsizing, you probably won’t be entertaining any large groups of people, so you can stand to lose a few chairs or beer glasses. Don’t weigh yourself down with duplicate items that you may only need in unique situations, and limit yourself to what will be used frequently.
- Explore storage options— One thing is certain when downsizing; you’ll need to become a storage fiend. That means you’ll need to look into shelving units, ottomans with built-in storage, and other storage solutions. By using these great storage options in your smaller living space, you’ll be better organized and can avoid feeling cramped in your new home.
- Stay organized— One of the keys to happiness when living in a smaller home is to stay organized so you don’t end up with a cluttered living space. Take the time to consider where something will be stored before you bring it into your home so you don’t ever end up with more than you have room for.
All in all, downsizing your home can be a worthwhile decision for all sorts of people. It can cut down on your carbon footprint, simplify your life, and most importantly— save you a lot of money. Take the time to really think about what downsizing means before making the decision to move and you’re sure to enjoy your smaller home.