4 Myths People Believe About Downsizing for Retirement
Preparing for retirement at any age is not only challenging, it’s downright scary especially in an unpredictable economy, with near-historically low interest rates and looming recession. When preparing for retirement, the best approach is to first create your vision, priorities and goals and then assess how much you will really need. Avoid getting caught up in the misinformation. Keep in mind these common myths, and plan your retirement with a big dose of reality. (1)
Downsizing for retirement is often thought of as a way to simplify one's life and declutter their home. However, many things need to be clarified about what downsizing entails. Here are eight myths that people often believe about downsizing for retirement:
Downsizing Your Home for Retirement is Only About Saving Money
Although saving money is a perk, there are several other reasons to consider downsizing your home when retiring. You likely have substantial equity if you've owned your house for an extended period and paid off most or all of the mortgage. If you're an "empty-nester" and your home is too large for your needs, selling it can free up a ton of money to add to your retirement savings.
Having enough funds to support yourself during retirement is vital, and selling your home quickly can give you the financial security you need. You could use the money from selling your house to buy a smaller condo or enter assisted living.
Shrinking Your Home May Not Give You the Savings You Desire
Your monthly overhead might stay the same as you think when downsizing to a smaller home, depending on where you're relocating. If moving from a rural area into an urban center, the increased cost of living in the city may balance out any supposed savings.
Some people downsize their homes when saving little money monthly on mortgage payments. Downsizing makes more sense if you're moving to an area with lower living expenses.
More things to think about are HOA or condo association fees. You could be responsible for maintaining the building you live in or paying for access to community amenities such as a pool and gym. Another element is property taxes; if you're considering moving, research how much you'll pay in your new location.
Downsizing Is A Lot of Work
If you list your home using conventional methods, be prepared to wait months for an offer. You'll have open houses and showings, but finding the perfect buyer willing to pay what your house is worth can still take a while. Those selling a house are often discouraged by the time investment and inconvenience it requires. Even after receiving a fair offer, the purchaser's financing may fail before finalizing the sale.
Using a professional home-buying company, you can sell your home quickly without waiting months or spending thousands of dollars on repairs and upgrades.
Downsizing Is the Only Way To Improve Your Financial Situation
You don't have to sell your house to acquire extra money for retirement. Take a more detailed look at your budget and find other ways to save money. For example, if you're used to paying someone to take care of your lawn, you can do this yourself with the extra time on your hands. The same goes for housekeeping services or other regular things like meal delivery.
You Can't Downsize If You Have Poor Credit
If you're looking to move into a retirement community or age-restricted development, your credit may be checked as part of the application process. However, you can still downsize your home if you have poor credit. Many other living options are available, from buying a smaller home outright to renting an apartment.
You Won't Be Able to Find a Home You Love as Much as Your Current One
Although it's normal to feel sentimental about your home, try to think about your downsizing decision logically. If you're moving to be closer to family, have more money for travel, or reduce your monthly expenses. It's also important to consider that your home is just a physical structure - the memories you've made there will stay with you no matter where you go.
You Won't Be Able to Downsize If You Have Too Much Stuff
If you're downsizing from a large home to a smaller one, you'll probably have to get rid of some of your belongings. This can be difficult, but it's important to remember that material possessions are just that - material. You can always buy new things, but you can only sometimes buy more time or experiences.
Start by going through your things and determining what you need and can live without. You may be surprised at how much stuff you can get rid of.
You Won't Be Able to Find a Home In Your Price Range
The cost of living has indeed been rising in recent years, but you will still be able to find a home in your price range. There are many ways to find affordable housing, from searching for government-subsidized units to looking for homes in more affordable areas.
Tips for Selling Your House Faster?
If you've decided that downsizing your home is the best way to improve your financial situation for retirement, here are some tips to follow:
1. Use a professional home-buying company: This will help you sell your house quickly without making any repairs or upgrades. We are Louisville home buyers; we will buy your home for cash; give us a call if this is the route you would like to take.
2. Do your research: Make sure to research the cost of living in your new location and compare it to your current overhead expenses.
3. Be prepared: Have your budget and all relevant paperwork in order before listing your home.
4. Be patient: Selling a house can take time, but if you're prepared and patient, you'll eventually find the right buyer.
Conclusion
Downsizing your home for retirement doesn't have to be a daunting task. There are many benefits to doing so, from saving money to freeing up equity in your home. Downsizing can be simple if you want to sell your house to raise money for retirement. You can start right away.
There are already buyers who would love to purchase your home-all-cash buyers that will give you a fair price without seeing the property. And you don't even have to make any repairs or upgrades. You can now get the money you want without waiting and use it for whatever you like. If you're considering downsizing your home for retirement, why not try? Remember that
we buy houses Louisville KY.
We here at Kentucky Cash Home Buyers are dedicated to getting the most cash possible into your pockets for your home as-is, so that you can get the most out of this situation and prepare to move on. We will buy houses in any condition without you needing to fix your home before sale.