3 Reasons to Downsize Your Home Even if You're Nowhere Close to Retirement

Shedding some space could pay off big time.

It’s somewhat common for homeowners to downsize as retirement nears, or once their careers wrap up. After all, retiring often means moving over to a lower income. And downsizing can be a means of savings at a time when money might be getting tight or more limited.

Plus, by the time many people reach retirement age, their children are old enough to be able (and want) to live on their own. And if you no longer have kids living at home, then paying for a larger home may not make sense. After all, what's the point of keeping a four-bedroom house when it's only you and your spouse living there, and you share a single bedroom?

But you don’t have to be nearing retirement for downsizing to be a smart move. Here are a few reasons to shed some square footage -- even if you’re years or decades away from exiting the workforce.

1. You want to save money

The more it costs to put a roof over your head, the less you’re apt to save. Downsizing could be a big source of savings, though. You might swap a larger monthly mortgage payment for a much smaller one. And you might end up with a considerably lower property tax bill as well. That should give you more financial freedom and make your bills easier to manage.

2. You want to do less work

The more living space you have, the more work it might create. Think about the process of cleaning your house. If it takes you three hours every week to clean four bedrooms and three bathrooms, it might only take 90 minutes to clean a two-bedroom home with one and a half baths. That’s time you can spend doing other things -- catching up with friends, enjoying various hobbies, or even relaxing and getting more sleep.

3. You want to make progress on other financial goals

A larger home can cost more than a smaller one. And the money you keep spending on it might be impeding certain goals.

Let’s say you’ve fallen behind on retirement savings because you’re spending so much of your income on housing. Downsizing could free up funds for your IRA account or 401(k) plan.

Similarly, let’s say your goal is to help put your kids through college. If you downsize and shrink your housing costs, you can free up money for your children’s education fund.

It’s not just for retirees

Although retirement is often when people decide to downsize their homes, there’s no rule stating you have to wait that long to shrink the size of your living space. You may find that downsizing earlier in life brings you closer to different goals and makes your expenses and schedule easier to manage.

And remember, downsizing might give you access to certain amenities you don't have in your current home. If you move from a detached house to a townhouse or condo, you might get to benefit from an on-site swimming pool, gym, and tennis court, to name just a few potential perks. So don't assume that downsizing will mean settling for a lesser quality of life.