Is a downsize in your future? When you hear the word “downsize,” most people immediately think of empty nesters. However, downsizing to a smaller and/or more affordable home could be a smart move for a variety of family types, such as retirees (or those close to retirement), small families, those with some children who have moved out of the house and some children still living at home, and more.
The financial (and logistical) benefits of downsizing can benefit a wide variety of individuals and families.
More often than not, a smaller home means a smaller price tag. When you downsize, your monthly mortgage payments will likely be lower than they were for your previous house. This frees up cash for you each month to spend on other expenses, like travel, entertainment, and more.
Tired of cleaning and maintaining a large home? Not only are smaller homes often more affordable, they typically require less upkeep. Imagine the sigh of relief you can breathe when your job is done after cleaning one bathroom instead of three!
Saving thousands of dollars over the life of your loan means more money you can put into your savings account or retirement fund. This can be beneficial for anyone at any age, but might particularly be appealing to those nearing retirement. If you want to really build up your retirement fund for a handful of years before you start tapping into it, downsizing may be a good option for you financially.
Pay Off Other Debts
Having a lower monthly mortgage payment, when you’re accustomed to living with your current payment, can be a helpful tool for paying off debt. Simply take the difference in your old and new mortgage payments and put that extra amount toward the debt you’re trying to pay off – whether it’s a credit card, car loan, student loans, etc. You’ll be able to pay off those debts faster, but you won’t feel much of a difference in your day-to-day because you’re already used to having a certain amount of fixed expenses each month and have likely been living that way for years.
A smaller space takes less energy to run – including heating and cooling, water, electricity, and more. Not only is this great for the environment, it can also save you money on your utility bills.
Expand Your Location Options
You can’t exactly build a three-story, 3,000 square-foot home in the middle of a city. However, small homes and condos are available just about everywhere. For instance, if you’ve been itching to move to a larger metropolitan area, you’ll likely have better luck finding a home with less square footage. A smaller house means more options for location.
Are you ready to get started on your downsizing mission? Find a local mortgage expert in your area to get started and learn how you can get pre-approved today.