The Upside to Downsizing for Retirement
August 30, 2021
Before joining a retirement community like Blue Hills Village, many retirees downsize from living in their family home into smaller, more manageable accommodation. Downsizing can secure financial freedom in retirement. But for many, it takes a heavy emotional toll. The substantial gains from selling your biggest asset might not pay for a foundation of happy memories. But as Newton’s Third Law wisely stated: For every action, there is an equal and opposite reaction. It’s important to remember there are upsides to downsizing. Here are a few to look forward to:
Lifetime financial security—but not without sacrifice
Although your home’s true value is a personal and subjective figure, the significant financial gain from downsizing into a lower priced home is obvious. Many retirees will make this position their goal throughout their working lives. But despite the appeal of financial freedom, the reality of leaving your property, giving any lingering ‘Boomerang’ children notice, and parting with your memories can feel too daunting.
As you sit in your favourite armchair reminiscing about family get-togethers, remember you are sitting on a massive amount of capital or equity—and tick tock—it’s waiting to be used. Imagine the freedom of not having a mortgage while boosting your savings and enjoying superannuation tax benefits. Downsizing into a smaller home does exactly that—providing financial opportunity and more time for a monthly fee. But this doesn’t mean turning your back on a lifetime of treasured memories and possessions.
Swap clutter for community spirit & convenience
It’s clear why many retirees downsize to live as part of a retirement community like Blue Hills Village. Belonging to a like-minded community benefits your overall wellbeing, but as we get older it can be more difficult to maintain social connections. Most modern communities provide residents with shared spaces and lifestyle facilities on-site, so it’s easy to build friendships and lead an active social life. At Blue Hills, features like indoor bowling and beautifully landscaped surrounds are perfect for enjoying with friends old and new.
Another benefit of downsizing is convenience. Ask yourself, “can I really bother with home maintenance and chores like mowing the lawn?” Hiring professionals can be a costly, ongoing expense. And even if watching The Block unlocks your newfound DIY passion, it probably isn’t worth risking your health. Downsizing into an independent, self-care home, like a One Bedroom Villa in a community like Blue Hills, does away with all the annoying chores. The village operator is responsible for all landscaped grounds, shared facilities and buildings, leaving you to visit family and friends, plan a trip or simply watch your (maintenance-free) garden grow.
But a smaller space means less storage and inevitably, you’ll have to part with some possessions. The sentimental value of all those knickknacks might seem priceless but skipping the decluttering simply defeats the purpose of downsizing. To ease the process, you can ask a trusted friend or family member to help with decluttering by providing neutral feedback. You can also try focusing on one room at a time to boost motivation. Just remember, downsizing is about sizing up the perfect fit for your dream retirement.
The views and opinions expressed are those of the authors. Please consult your own legal or financial advisors before making any decisions.