If you think moving up in life means buying a larger home you may want to rethink things. Most families have plenty of room to downsize their home without sacrificing too much.
A look at the numbers: The average new single-family home is 2,700 square feet, according to Census data. You may say that’s not too big until you look back at history. In 1950, the average home size was less than 1,000 square feet—and families were larger back then. By those standards, today’s homeowners are living large!
Moving into a smaller home may feel like a step down, but a closer look reveals quite a few upsides.
A look at the numbers: The average new single-family home is 2,700 square feet, according to Census data. You may say that’s not too big until you look back at history. In 1950, the average home size was less than 1,000 square feet—and families were larger back then. By those standards, today’s homeowners are living large!
Moving into a smaller home may feel like a step down, but a closer look reveals quite a few upsides.
Less Is More
One question we always hear when the topic of downsizing comes up is: “Where will I put all my stuff?” Take a look at all the items you have around your home that you haven't used in years and start getting rid of stuff. It’s time for garage sale or use Facebook marketplace.
A smaller home means less space but also means less time, stress and money spent on upkeep. Think of all the fun you could have if you didn’t have all the upkeep. You just might find time for a new hobby that you’ve been thinking of.
Take a look at these numbers
Still not convinced? What if you reduce your mortgage by $500 a month and put that cash toward other financial goals?
Here are just a few of the strides you could make:
Pay down your Debt:
If you’re working hard to pay off your debt, downsizing your home will escalate the process. If you owe $18,000 on your student loan with a 6% interest rate and a minimum payment of $200 a month, you’ll be paying on that loan for 10 more years!
But pay an additional $500 on that same loan each month, and cut seven years and eight months off your pay-off date. You’ll be free from student debt in less than two-and-a-half years!
Increase Your Retirement Fund:
Once you’re debt free with a fully funded emergency fund, it’s time to build wealth for the future. The financial gurus recommend investing 15% of your household income into Roth IRAs and pre-tax retirement plans.
If you’re still working your way up to 15%, that extra $500 could be the push you need to get there. The difference $500 could make in 30 years, you could have an additional $1–1.6 million in the bank to get you through your golden years. You can enjoy living with that nest egg!
Pay Off Your Mortgage:
Trade that mortgage for a paid-off home! Use the proceeds from selling your current home to pay cash for a smaller one. Just imagine the financial advantage with no mortgage to worry about!
If you can’t pay cash, shoot for a 15-year fixed rate mortgage and put at least 10–20% down on your new home. Apply the $500 you saved from downsizing to your new monthly payment. At 3% interest, you could pay off a $200,000 mortgage in less than 10.5 years, saving almost $16,000 in the process.
Is Downsizing Right for You?
Downsizing may not make sense in every situation, but it’s worth a look if saving money and simplifying life appeals to you. Ask us to help you determine what your home is worth and show you options for cutting costs. TopGaHomes knows what it takes to get top dollar for your current home and negotiate the best deal on a new one.
Ready to downsize but don’t know where to start? Contact us today!
One question we always hear when the topic of downsizing comes up is: “Where will I put all my stuff?” Take a look at all the items you have around your home that you haven't used in years and start getting rid of stuff. It’s time for garage sale or use Facebook marketplace.
A smaller home means less space but also means less time, stress and money spent on upkeep. Think of all the fun you could have if you didn’t have all the upkeep. You just might find time for a new hobby that you’ve been thinking of.
Take a look at these numbers
Still not convinced? What if you reduce your mortgage by $500 a month and put that cash toward other financial goals?
Here are just a few of the strides you could make:
Pay down your Debt:
If you’re working hard to pay off your debt, downsizing your home will escalate the process. If you owe $18,000 on your student loan with a 6% interest rate and a minimum payment of $200 a month, you’ll be paying on that loan for 10 more years!
But pay an additional $500 on that same loan each month, and cut seven years and eight months off your pay-off date. You’ll be free from student debt in less than two-and-a-half years!
Increase Your Retirement Fund:
Once you’re debt free with a fully funded emergency fund, it’s time to build wealth for the future. The financial gurus recommend investing 15% of your household income into Roth IRAs and pre-tax retirement plans.
If you’re still working your way up to 15%, that extra $500 could be the push you need to get there. The difference $500 could make in 30 years, you could have an additional $1–1.6 million in the bank to get you through your golden years. You can enjoy living with that nest egg!
Pay Off Your Mortgage:
Trade that mortgage for a paid-off home! Use the proceeds from selling your current home to pay cash for a smaller one. Just imagine the financial advantage with no mortgage to worry about!
If you can’t pay cash, shoot for a 15-year fixed rate mortgage and put at least 10–20% down on your new home. Apply the $500 you saved from downsizing to your new monthly payment. At 3% interest, you could pay off a $200,000 mortgage in less than 10.5 years, saving almost $16,000 in the process.
Is Downsizing Right for You?
Downsizing may not make sense in every situation, but it’s worth a look if saving money and simplifying life appeals to you. Ask us to help you determine what your home is worth and show you options for cutting costs. TopGaHomes knows what it takes to get top dollar for your current home and negotiate the best deal on a new one.
Ready to downsize but don’t know where to start? Contact us today!
