With retirement looming, kids off to college, and friends making plans for their later life it may be time to start thinking seriously about the years ahead. One of the big decisions people may make as they near retirement age is whether they should downsize. Moving to a smaller home can release money to enable you to enjoy retirement with more financial comfort. Here’s how you can potentially take those first steps to downsizing your property.
Decide What You Need
When planning a downsize you’ll have several things to think about besides selling your home. You might want to be nearer members of your family or there may be a favorite place you want to spend more time. Don’t forget to think about facilities near you and to plan for five to ten years ahead. While you may enjoy a good level of fitness now, should you fall ill would that remote cabin really be such a good idea? Having shops and other amenities within walking distance of your home is practical. For some people being part of a retirement community is a positive choice whilst others decide on a smaller apartment within a city or town.
Budget for Your New Life
Once you have a retirement plan to downsize, start budgeting how much you’ll need to get by. This should include money to enjoy your interests, such as travel, as well as maintaining your daily lifestyle. You may need some help to do this but it is worth planning out the money you will need for retirement in order to see the potential for downsizing and the choices you have. While it is important to budget it is also vital to ensure you don’t overstretch your finances and become unable to afford unexpected bills or vacations.
Start Clearing Your Closet
When you have a plan you may need to start clearing out any clutter and unwanted items. Think about regifting items you have enjoyed but no longer require to family and friends. You may have a yard sale with unwanted things or start selling online to raise cash. Use your local thrift store to offload anything no longer of any use. Once you have had a good clear out you’ll get an idea of the space you don’t require, your home will be more appealing to buyers, and you’ll have less to pack for your move. This is also a good way to potentially create more retirement income and savings.
Search for Your Smaller Home
If you know the area you are heading to you can start looking for a place to live. As well as the property you’ll need to check out local facilities and think about the conditions in winter when it is more difficult to get around. Do check out transportation. If there is none, how will you get around if you have to stop driving? Are there lots of steps to your new home and how will this work if you were less able to manage. You are probably fit and healthy right now but old age creeps up on everyone and factoring in these issues will help avoid more moving later.
Once you have that perfect apartment or new house you’ll need to plan the date and start getting ready to settle into both a new area and lifestyle.
This content is designed to provide general information on the subjects covered. It is not intended to provide specific legal or tax advice and cannot be used to avoid tax penalties or to promote, market or recommend any tax plan or arrangement. You are encouraged to consult your personal tax advisor or attorney.
Gary Marriage Jr. is the founder and CEO of Nature Coast Financial Advisors, which educates retirees on how to protect their assets, increase their income and reduce their taxes. Marriage is a national speaker, delivering solutions for pre-retirees, business owners and seniors on the areas affecting their retirement and estates. He is an approved member of the National Ethics Bureau, and has been featured in “America’s Top Hometown Financial Advisors 2011” and was selected to contribute to a book with Steve Forbes titled “Successonomics”
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