Think about how much space you have in your home. How much of it do you actually use? Unless you’re living in a cramped apartment in the city, chances are you’re not utilizing every area of your home.
Moving into a smaller space might feel like a step down, but that’s not always the case! Downsizing and decluttering can save you tons of money, and feel like a fresh start if you’re looking to live a bit more minimalistic.
Below, we’ll discuss a few ways downsizing can save you money, and prove financially beneficial long term.
What financial benefits can I gain from downsizing?
1. You’ll minimize your debt
Whether it’s student loans, medical bills, or simply an overly budgeted mortgage, downsizing is a great way to help minimize those debts. While you might not see the payoff right away in the short-term, that decreased monthly mortgage payment will add up quickly, and can be put towards existing debt. You’ll also be saving tons of money on utilities and property taxes, which can rack up quickly in a large home.
2. You’ll boost your retirement fund
Once you’ve started paying off your debt, you’ll be able to put more money towards your retirement fund. Whether you’re on an individual or group retirement plan, chances are you’re probably putting at least 3% towards retirement each month. As we all know, getting started with retirement savings should happen sooner rather than later. By downsizing, you’ll be able to add more to your retirement fund each month, and set yourself up for long term success.
3. You’ll earn some extra cash
If you’re planning to downsize, you’ll need to do some decluttering. Instead of throwing things away or taking it to a dump, consider selling it! Facebook marketplace and neighborhood garage sale groups are huge these days. Or, you can host a traditional in-person garage sale as well. You could also consider taking your clothes to a consignment shop, or take smaller items to a pawn shop.
How do I know if downsizing is right for me?
While all of this sounds good in theory, downsizing shouldn’t be taken lightly. There are a few questions you should ask yourself before taking the leap.
- How will this impact you emotionally? If you’re attached to your home and/or area and can’t see yourself living anywhere else, comfort may trump any financial benefits.
- Am I utilizing too much space? Maybe your kids have gone off to college, or you no longer need a home office space. If it feels like you’re wasting space, you probably are.
- Have you considered associated costs with downsizing? Remember, there are still moving costs to be considered. Will the long term financial benefits outweigh the short term costs of moving supplies, a moving truck, travel expenses, etc?
If you’re looking to downsize and need to do it rather quickly, Home Buyers Express can help! We buy homes for cash, and you won’t have to worry about closing costs, home inspections, foreclosure, etc. If you’re in Maryland and are in need of assistance fast, contact us today.