Millions of Canadians age 50 and older are looking around their spacious homes and are deciding they don’t need all that room anymore. The kids are gone, maybe a spouse, too. With their lifestyles changing, many are rethinking where they want to live in retirement. And they could really use the money from a sale to bulk up their retirement funds…
Here, in this article by Miranda Marquit we take a look at the Advantages to Home Downsizing:
During retirement, we often think about how to better stretch our dollars. After all, the goal is to last longer than our money. One of the ways to make your nest go further is to downsize to a smaller home.
Downsizing to a smaller home during retirement often reduces your expenses, and it provides you with a way to get a little more cash out of your previous home. It can be especially effective if you have the mortgage on your larger home paid off.
Cost Advantages of Buying a Smaller Home
For many retirees, a smaller home makes sense. The kids have grown up and moved out. Additionally, a smaller home is easier to clean and maintain. You don’t have to spend as much time and money on upkeep. Some of the lower costs that come with a smaller home include:
- Lower utilities: Smaller house, lower bills. Save money each month on heating/cooling your home, as well as electricity and water.
- Lower property taxes: When you live in a smaller home, you are likely to see a lower appraisal from the government, and your property taxes will probably be lower.
- Fewer purchases: When you know you don’t have the room, you are less likely to make so many purchases. After all, where will you keep all that stuff? Downsizing your home can help you downsize your lifestyle altogether.
Run your retirement calculations to determine if you need to free up a few hundred dollars a month to live comfortably. Simply moving to a smaller house could be the solution you are looking for, since it results in monthly savings that can ease your retirement cash flow.
Receive a Cash Infusion When You Buy a Smaller House
Hopefully, you will have paid off your mortgage by the time you retire. Creating a retirement plan that ensures that your mortgage is paid off can help you reduce your monthly obligations, as well as provide you with the ability to buy your new, smaller house outright.
Use the money from the sale of your larger home to buy a smaller home. The difference in the prices is cash that you can use to help your retirement, whether you want to go on a trip, or whether you want to change up your investment portfolio. A little extra capital can go a long way if used right.
Don’t be tempted to buy with another mortgage. All you need to do is use a home mortgage calculator to see how much a mortgage will cost you over time. On top of that, the goal is to reduce your obligations in retirement — not add to them.
Timothy Real Estate Group has professional designers and stagers that can help you prepare your home for the war. Gorilla tactics that work because it is a Price War and a Beauty Contest that can mean making and saving more with your property investment. Stay informed about Puerto Vallarta Real Estate and sign up for our newsletter… click here
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