Choosing to downsize is not just for baby boomers, empty nesters or the newly retired. There are many reasons to sell up and move to a smaller property. There are many younger couples that want to alleviate their cost of living, or make their lives easier with a more accessible home for health or mobility needs – sometimes called “rightsizing”. Or sometimes divorce, separation or bereavement may mean selling the family home.
The benefits of downsizing or rightsizing
If you are retiring you might want to move somewhere you can relax and take advantage of a slower pace of life. If you picture your retirement in the countryside or by the sea, downsizing could free up the extra cash you need to make it happen.
If downsizing means a smaller mortgage, you’re likely to have more disposable income to spend on other pastimes, take up a new hobby, or travel more. Or perhaps you can make some improvements or alterations to your new home.
Fewer rooms and smaller spaces mean less time needed for cleaning and maintenance.
A smaller home also means lower utility bills. Reducing energy has the added advantage of being better for the environment too.
If there is no place to put it, you’re much less likely to buy it. That means you may acquire less clothing and consumer goods. Reduced consumption is also a good environmentally friendly habit to acquire.
Things to consider
Any potential house move can be an emotionally charged decision. In a recent survey by Hargreaves Lansdowne nearly 40% of retirees rejected the idea of downsizing because they were too attached to their family home.
If your intention in downsizing is to release cash to fund your new lifestyle then you will need to take the cost of moving home into account. According to comparemymove.com the estimated cost of moving house in 2021 in the UK is £8,951.
Space restrictions in your new home may also mean selling, giving or throwing away treasured furniture, books, and mementos. Some people form emotional attachments to possessions and can’t bear to part with any of them.
A smaller home may mean less room for guests. Hosting a family Christmas or having grandchildren to stay might become a challenge.
Downsizing or rightsizing will require a lot of thought and planning and may not be for everyone. But at the end of the day you may want to remember that you could be freeing up your home so another family can fall in love with it. And you may be giving yourself the chance to fall in love with something new and exciting all over again.
If you’re not sure what’s right for you, talk to an Independent Financial Advisor.