Did you know that only 18% of retirees have more than $400,000 in their retirement savings? With only 18% of retirees having this amount of money saved away, it is concerning for other senior citizens who want to retire without being strapped for cash. Once you enter retirement, you may become overwhelmed with your Medicare questions and finances. One way to save money for retirement is by downsizing homes. Downsizing homes means moving to something smaller than you currently live in. If you want to save money and experience change, keep reading for five reasons to downsize after retirement!
1. Manage home better
Being a homeowner requires work, especially if you live in a large home with a yard. From mowing and weed eating the lawn, inside and outside maintenance, and cleaning every room in your home, owning a home is no simple task. You can save time and effort on home maintenance by simply downsizing!
Downsizing in retirement allows you to enjoy your days and weekends with friends and family without spending all day cleaning your larger home. You may also be able to save money on home repairs if you move into a more up-to-date modern home or apartment. If managing your home is starting to damper your mood, consider downsizing after retirement.
2. Save money for health insurance
Retirement can be expensive, and Medicare health insurance is no exception. Many retirees enter retirement excited about their “free” health insurance from the government. However, Medicare being free is a myth, as it most certainly comes with monthly premiums.
According to the Fidelity Retiree Health Care Cost Estimate, an average retired couple aged 65 in 2022 will likely need approximately $315,000 to cover health care costs during retirement. Medicare has premiums, deductibles, copays, and coinsurance. Since Medicare leaves you with out-of-pocket expenses, beneficiaries purchase additional insurance, such as Medigap Plan G, to help cover those costs. Medigap plans also have monthly premiums, so this will be a cost you will need to consider.
Downsizing in retirement could be your answer to how you can save money for your health insurance!
3. Navigate through your home safely
More than 36 million older adults fall every year in the United States, which is one out of four seniors. A fall can cause severe injuries and can even be fatal. When you downsize homes, you can navigate through your home more safely.
Age often comes with mobility restrictions. So, if you live in a home with a big floor plan or a two-story house, you may become exhausted after walking around doing day-to-day activities. If you plan to spend your retirement primarily at home and not traveling, consider downsizing homes to avoid potential falls and eliminate the free space.
4. Have a reason to declutter
It’s normal for seniors to collect stuff throughout their lifetime! However, it’s common for those collectibles to end up stuffed in a closet and never see the light of day. Downsizing homes can be the initiative to finally declutter all your belongings!
You don’t have to get rid of all your memorabilia, but you can sort through your items. You can create three separate piles for things you want to keep, donate, or throw away. Enjoy the walk down memory lane while you declutter before you downsize.
5. Follow your dreams
Lastly, downsizing after retirement allows you to follow your dreams! In retirement, you don’t have to settle down in one place. Many seniors become snowbirds and travel to warmer states, or they up and move entirely to their dream location.
Retirement is when you can do the things you have always wanted to do while working. Use downsizing as your excuse to leave everything behind and live your life as you were destined.
Don’t be strapped for cash by staying in your large home! Although there are just five reasons to downsize after retirement, know that there are plenty more.