Downsizing your home
Circumstances change and downsizing to a smaller property can be an appropriate change to your life in the right direction, or as we like to say- the first step to your new life. Downsizing is a smart move for most seniors because it takes away the burden of having to tend to a house that is no longer truly needed. The benefits of moving into a smaller place are numerous, but the act itself isn’t always easy, especially if you’ve been living in your home for a while.
These are a few considerations in the decision-making process before you jump head first into buying a smaller space, retirement housing or even entering a higher aged care facility.
How do I know if its time to downsize?
It’s best to start planning as far in advance as possible. Even if you’re not fully committed to downsizing your home for retirement, you should still come up with a plan in case you find yourself in a situation where the move is necessary, like you or your spouse getting sick. Look into housing options that are both appealing and affordable and start saving money. Having a solid plan will make the process much less stressful if you have to move on a whim and especially easy if you’ve been planning to downsize for a while.
Location/destination is a primary issue
The benefits that come with downsizing are going to be negated if you move into a place in a bad location. If possible, move closer to family members or close friends. If that isn’t an option, move into a place where you don’t have to worry about who is going to help you if you’re sick, injured, or unable to do certain day-to-day tasks. A housing community tailored to seniors’ needs, close to transport, medical facilities is essential for those looking for a comfortable home with future needs are considered.
Downsizing isn’t something that’s easy, and it can be a very emotional process. Do, however, with some proper planning and time management, the move doesn’t have to be too burdensome.
What are the benefits of downsizing?
Firstly, run the numbers. Have you found that downsizing actually leaves you with a bit of extra cash? Have you weighed up the emotional effects? Then, why not take the plunge? Whilst downsizing isn’t a decision anyone should take lightly, there are a number of benefits to the move. These include:
Paying off the existing mortgage
Generally downsizing means purchasing a property for less than the value of the existing home. Freeing up this extra cash is a great way to pay off any outstanding principal amounts on your mortgage which will save you paying more interest.
Increasing your retirement savings
If you sell your existing home and buy a smaller and less costly home, you could be looking at saving up this extra money for your retirement savings.
Downsizing contributions into superannuation
The Contributing the proceeds of downsizing into superannuation measure was one of several announced in the 2017-18 budget as part of the Government's package of reforms to reduce pressure on housing affordability in Australia.
Lower living costs
While there are many costs with moving house and downsizing there are some long-term financial savings to be made. This includes cheaper utility bills because the less space you have the less you’ll be spending on gas, heating, cooling, and maintenance.
Housing, in-house help and moving into retirement villages or higher care? Aged care options are complex, with forever changing rules & costs buried in fine print which can be quite distressing for you.
Get expert help
There are professionals who can help you with every step of the downsizing processes. Real-estate Agents, conveyance agents can help you with the whole buying/selling process. Aged Care Advisers, Financial Advisers can navigate the financial mind field if you can't. Make sure you have a licensed adviser look over your whole situation thoroughly.
SFR Property Professionals with the help of SFR Advisory Group is here to help. Take the hassle out of what is one of the most complex transactions of your life.