You’ve spent your entire life accumulating stuff, from the furnishings in your bedroom to the cabinets under your sink. Now that you’re retired, though, there’s no reason why you have to keep it all. By downsizing and packing up some of those items, you can save money on moving costs—and have more cash for traveling or spending time with friends and family. The benefits of downsizing are clear: smaller homes offer less maintenance and upkeep over time than larger ones do; they also take less energy to heat or cool. It’s easy to get started by thinking about what rooms in your home could use a little decluttering—but then again, when is anything simple when it comes to moving? We’ll walk through some tips below on how best to prepare yourself mentally and physically before making any major changes in your living space.
Plan for the future.
Planning for the future is an important part of downsizing. You may not be moving for a few years, but it’s still important to think about all aspects of your life, including where you want to live and who will take care of things like utilities and maintenance.
Planning ahead can help make sure that when it comes time to sell or rent out your home, everything goes smoothly. A financial planner can help figure out what kind of income stream will work best in retirement (if any), as well as how much money might be needed on an annual basis for basic expenses such as food and shelter–and even other items like travel costs or entertainment options.
Be realistic about the size of your new home.
If you’re downsizing, don’t buy a bigger house than you need. Many retirees often buy houses larger than they need in anticipation of entertaining the grand kids and other family members. Often, this dream doesn’t materialize. You may be retired, but friends and family still have jobs and commitments that limit their time.
If you’re not sure what you need, don’t buy a house just because it feels like the right thing to do. It may not be worth the added expenses and responsibilities if all your furniture fits easily into storage containers and boxes. Many times a condo or townhouse is a better solution for downsizing, especially if travel is in your plans.
Be clear about your financial goals for retirement.
It’s important to know how much you will need to cover your expenses in retirement. You need to figure out what kind of lifestyle you want, and then plan for it. If possible, talk with other people who are in or close to retirement and get their opinions on how much they spend on food, travel and entertainment.
If you are not sure about how much money you will need in retirement, consider these options:
- Look at past spending records (from credit card statements or checkbook registers) and see how much was spent on various categories of expenses over time. Use this information as a guideline for estimating future monthly costs; add any expected increases into the mix as well.* Talk with friends about their budgets for everyday living expenses such as groceries and utilities.* Plan for unexpected costs that may come up during retirement such as medical bills from an accident or illness; include these amounts when creating a budget based on past spending records
Consider downsizing as a way to lower your monthly payments or other costs.
- Consider downsizing as a way to lower your monthly payments or other costs.
- If you plan to retire in the near future and want to reduce the cost of living, consider downsizing your home. The cost of maintaining a large home can be prohibitively expensive, especially if it’s located in an urban area where property values are high. By moving into a smaller house with fewer rooms and amenities, you could save money on utilities (e.g., heating) as well as maintenance such as lawn care–and even insurance premiums if you’re paying off any mortgages still owed on the property.
- In addition to saving money on housing expenses after retirement, downsizing also allows retirees more freedom when traveling because they don’t have so much stuff weighing them down when packing up their cars for trips out of town or abroad!
The best thing that you can do is start planning well in advance of a move so that you can enjoy your new lifestyle when it comes time to settle in
The best thing that you can do is start planning well in advance of a move so that you can enjoy your new lifestyle when it comes time to settle in.
If you’re thinking about downsizing, don’t rush into a decision. Take as much time as needed to make sure that moving into a smaller home is really what’s best for you and your family before making any commitments or putting down deposits on a home or condo unit.
Downsizing your home is a big decision and it can be stressful, but it’s also one of the best ways to prepare for retirement. When you downsize, you have more time on your hands and less stress because you don’t have to worry about maintaining a large house or yard anymore. You can use this extra time doing things that matter most to you like spending time with family or traveling abroad!