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Many parents simultaneously fantasize about and dread the day their children will leave home. Just as the emotions that accompany an empty nest can be complicated, so too can the questions about what to do with all the extra space that opens up once children’s bedrooms become shrines to the past.

For people who don’t need—or want—to live in a house better suited for a full-size family, downsizing can be a practical move with long-term benefits. While a smaller home can provide the motivation to get one’s belongings to a manageable level, it can also translate into the kind of savings that can give your nest egg a major boost. Here’s why.

Did You Know?

60% of homeowners over the age of 60 report that they have “more things than they need” in their current home

Smaller Home, Bigger Wallet Along with getting married and having children, the purchase of a home is one of the most significant events in a person’s life. It’s also one of the most expensive. In fact, mortgages and other home-related expenses typically chew up between 40% and 45% of the average American household budget, which is why downsizing to a smaller, less expensive home can reap such big savings. For example, making the jump from a home worth $250,000 to one valued at $150,000 can generate as much as $6,000 in annual mortgage payment savings and another $3,250 in reduced operating expenses, such as utilities, insurance and maintenance.

A Big Tax Break Even if you’ve already paid off your mortgage, you will still have to contend with some major fixed expenses, especially property taxes. Although they are much higher in states like New York and Colorado, the average property tax bill nationally runs about 1.4% of a home’s value. That means there are potentially significant savings to be had even by moving to a lower-value home in your neighborhood.

A (Financial) Change of Scenery Although plenty of empty nesters will want to stay in the area where they raised their families, others may be inclined to pick up and move to a different state. Those who opt to downsize to a less expensive region of the country—perhaps one closer to their children or extended family—may find that it’s possible to garner substantial savings, even if they don’t want a home of a smaller size. How substantial? For context, housing in Fayetteville, Arkansas—home to the University of Arkansas and near the renowned Crystal Bridges Museum—is 37% cheaper than in Washington, D.C. Given that groceries, transportation and health care are also less expensive in certain parts of the country, anyone willing to make the move could free up a lot of money to save.

In fact, a recent report found spots in all corners of the U.S. where retirees could live off of Social Security benefits alone. Popular, inexpensive spots include Buffalo, NY, in the Northeast; Columbia, SC, in the Southeast; St. Louis in the Midwest; Albuquerque, NM, in the Southwest; and Spokane, WA, in the Northwest.