Downsizing - A Smart Move
It's More than a Corporate Move
If you look at downsizing in terms of corporations, then you know it is a financial decision. And, it generally has a positive effect on the bottom line of any company. Less overhead means more profits - simple. As a matter of fact, the exact same principle works when it comes to downsizing your house. Although most of us associate downsizing with retiring or looking for a smaller place after the kids have left home, downsizing has become a popular move for more and more hard-working folks who are doing smart things with their real estate and their money.
Look At the Money You'll Save!
The cost of living has soared over the past few years, and with energy prices rising daily and home prices fluctuating, it just makes good sense to move into a smaller place. The advantages are numerous and certainly worth investigating. For instance, you can immediately reduce your largest expense - your monthly mortgage payment. Most people spend at least 30% of their gross income on their mortgage. That works out to about 50% of net. That's a lot of money. Reducing the size of your house can translate into more money to do other things in life - and save you a bundle in interest costs. A smaller mortgage leaves more money at the end of the month instead of the other way around.
After mortgage, taxes are the next biggest cash outlay for a homeowner. By moving into smaller square footage, it's possible to reduce your taxes appreciably. If you choose a new neighborhood, preferably one with lower real estate taxes and lower income taxes, you can lower the assessment on your new digs. You may also end up saving a lot in travel costs, groceries, car insurance and gas by moving into an area that is different.
A Lot Less Maintenance
By moving out of a huge home that requires massive upkeep, you can save on costs that would be double what they would if you were in a smaller place. Think of the savings in maintenance costs - less landscaping, no more pool service and repairs, fewer rooms to paint and a smaller roof to fix. And, even if you have to do your own work around the new place, it will likely be a lot less than you're doing in the McMansion.
Think It Over - Then Move
Before you make the decision to move, though, go through your present home and assess how much of it you really use. Spend some serious time thinking about why you want to move, too. Consider all of the changes outside of financial relief - neighbors living a lot closer than they do now, maybe a condo where pets are not welcome (can you live with that?), a new lifestyle that is very different from what you have now.
Take your time, plan and make sure you're doing the right thing for yourself before you make the move. If it's for you - then just do it.
