I grew up in New York City, where square footage tends to come at a premium. As such, I'm more than used to the idea of living in a smaller home, and I never really minded having less space until I had kids.
These days, I live in a nice-sized suburban home that's probably four times the size of the home I grew up in. And while it's a fairly expensive home to own and maintain, it makes sense to give my kids room to spread out.
But one of the first moves I plan to make in retirement (or perhaps ahead of it) is to downsize to a much smaller home. Here's why.
Image source: Getty Images.
1. I don't want sky-high property taxes eating away at my retirement income
I'm doing my best to save for retirement by prioritizing my nest egg. These days, I not only max out a solo 401(k), but I also put money into a taxable brokerage account and HSA in the hopes of setting myself up with a nice income stream later in life.
But saving money at that level requires some sacrifices on my part. It means taking on extra work and minimizing my spending in different expense categories. And so the last thing I want to do is spend my career building savings only to fork over a large chunk of my retirement income to property taxes later in life. I'd rather shrink my square footage and slash that bill.
2. I don't want to spend my days worrying about maintenance
The more house you have to maintain, the more time and money you're apt to spend on upkeep. That's something I might have the patience and energy for now. But I don't know that I'll have it once I'm older.
Also, as it is, I plan to work in some capacity during retirement. And the reasons for that are multifold.
First, I'm someone who thrives on structure, so I think working is the sort of thing that's important for my mental health. And also, while I'm trying my hardest to build retirement savings, I don't know how well my nest egg will hold up. As such, I hope to work as a retiree for the financial benefit, too.
But because I intend to hold down a job, I don't want to have to worry about spending hours each week on home maintenance in retirement. And the less space I have, the less of an issue that becomes.
3. I don't think I'll need the space
I'd like to say I won't be the kind of parent who pushes her children to leave the nest for good once they go off to college. But my parenting style has always been to encourage independence, so I'm hoping not to have grown, adult kids living under my roof for too long once they've gotten their degrees. And if that's the case, I won't need as much space as I do right now.
A move that makes sense for a lot of people
It's fairly common for seniors to downsize their homes once retirement rolls around. Doing so could mean not only spending less money on property taxes and maintenance, but also walking away with a nice home sale profit.
Of course, it's not always easy to part with a home you've lived in for years. On my end, I'm sure I'll have moments of feeling sentimental about the home where my kids took their first steps. But the practical side of me knows that hanging on to a larger home in retirement just doesn't pay for many reasons. And that alone should help me feel good about my decision to downsize once I'm able to act on it.
