Tips for downsizing in retirementSunday, September 19, 2021
Rose Miller, head of the JN BeWi$e Financial Empowerment Programme, says downsizing in preparation for retirement makes good financial sense.
She said for some downsizing means selling their current home and moving into a smaller and more manageable property to cut costs. For others, it means getting rid of items they no longer use or scaling down their expenses to boost their retirement fund.
“It often becomes a necessity because retirement income may not sustain your expenses when you stop working,” she said.
If you're approaching retirement and thinking about ways to reduce your expenses here are tips on how to get started and what to consider when downsizing for retirement:
Downsize your home
One of the key things you need to figure out when planning for retirement is where you want to live. This might entail selling your current home, which for most people is their most valuable asset. You can use the funds to buy a smaller property or put the money toward rent and deposit any leftover money into savings. Downsizing your home not only saves you money, but it can also save time and effort because you have a smaller property to maintain.
Be realistic when it comes to selling your home
It's important when downsizing for retirement that you get your home valuated/appraised by a qualified appraiser, who will provide you with an honest answer about the value of your home, based on comparable sales in the area. Having an objective opinion like this will help put you in the best position to sell fast.
Consider Renting: If your home can be easily configured to accommodate a tenant, consider renting out a portion instead of trying to sell it. The income can then be used to supplement your budget.
Sell your car
Even if you're done paying off your car, it can still be a major expense, covering gas, insurance, maintenance, and repairs. If you and your partner each own a car, consider selling one of them. Even if you only have one car, it might be cheaper to sell it and get around using public transportation, or with the assistance of friends or family.
Sell furniture and items you no longer need
Whether you plan to move to a smaller home or not, it's a good idea to sell items that you'll no longer need, including some of your larger pieces of furniture. This will not only generate income but reduce the clutter and improve safety. For any items you can't sell, you may want to give them to friends and family or donate them.