The home you are living in currently may not be the right home for you in the future. Many people buy their dream home with the hopes of staying in it forever. Things change and your dream home of a couple of decades ago may not fit your needs today. Let's look at five signs that it's time to downsize your home.
You Are About to Retire
Retirement is a milestone in your life. You have worked for many decades and want to enjoy life. Looking around, you may find your current home is just too big. It takes money to keep up the maintenance and, as you grow older, it may become more difficult for you to handle. Investopedia explains, “downsizing your house can have a dramatic and direct effect on mortgage expenses. At the very least, it can result in a significant reduction in your monthly expenditures, a significant increase in your free cash flow and massive savings in interest over the term of your mortgage.” You can downsize when you retire to a home that is more suited to your new lifestyle.
Your Kids Are Grown
The last kid graduated and is out on his own. The house that was once full of children, toys, and clutter is now quiet. Downsizing at this point makes financial and lifestyle sense. You can lower your mortgage payment and put that money towards retirement. Plus, you will have less space to maintain and more money to pursue travel or hobbies.
You Are Struggling Financially
If you've noticed yourself stressed and worried over mortgage payment and cost of living it may be time to consider downsizing. You may find that your mortgage payment is just too high with your current salary. Downsizing to a smaller home would allow you to lower your mortgage payments to one that fits your current salary level. According to Clever, downsizing can be rather beneficial as it not only reduces mortgage payments, but it also helps you free up equity, which can help bring peace of mind.
Your Health Condition Has Changed
When you bought your home, you were in great health and could handle the maintenance and chores with no problems. Then, something changed. Your health isn't like it used to be. Maintenance and housework have become a struggle. Downsizing would allow you to reduce the maintenance and housework that has to be done, making life a bit easier.
You Can Make a Profit
You may have bought your home when prices were down after the real estate crash over a decade ago. Now, prices have come back up. Your neighborhood may be one of the hottest markets in your area. Good Housekeeping recommends, “your property is likely to be worth more now than when you bought it, but smaller properties and certain locations will be more expensive. So it’s essential to get a valuation to find out how much your current property is worth and check prices in the area that you want to move to – and make sure that you’re actually going to save money!” If you sell your home right now, you could make a substantial profit on the sale and take that money and buy a smaller home without a mortgage.
These are just five reasons why it may be time to downsize. Don't let time slip away before you make the move.
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