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Should you downsize your home in retirement?

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By Capital Partners Ambitious Retirees

Downsizing your home in retirement can be an exciting opportunity to adjust your space to suit your new lifestyle. While it can be exciting, no one needs to explain how emotionally charged the decision to sell the family home can be. The answer to downsizing in retirement is totally dependent on your circumstances and is usually one of the heavier conversations our team supports families to navigate. Sometimes, this decision can weigh in the back of your mind for quite some time. So we wanted to share some of the most common motivations we see when it comes to making this decision. If this resonates with you, your adviser can help illustrate what this could look like.

Retirement is often a chance to do everything you have always wanted but never had the time for. As we enjoy our post-work years and celebrate birthday milestones, many retirees will find themselves in discussions with their family and friends about downsizing their home. This decision will always be immensely personal. If downsizing has been shifting from an idea to a reality, speaking to your adviser may be a comfortable place to start. From a purely financial point of view, your adviser will likely begin by crunching the numbers for a theoretical compare and contrast. From superannuation considerations, cashflow relief and the trade-offs associated with moving, having a clearer financial picture of how this decision can help you achieve your goals may help influence your decision.

As our retirement specialist Rakesh Shah states, “there is no point planning for money without planning for life”. Your ideal retirement lifestyle encompasses more than just your bank balance or investment portfolio. If you’re considering downsizing or selling your home in retirement, it is important to consider what this decision will mean for your well-being, goals, and lifestyle. Will downsizing mean easier mobility, less upkeep with the gardening, your dream home with land, or the ability to funnel extra savings into travel and the grandkids? It is equally important to consider if downsizing will still enable you to live the lifestyle you are after? Will you still be able to entertain guests and have the family visit? How would you feel about changing suburbs or moving away from your neighbours? Our team can help you answer these questions with certainty, ensuring that your decision will complement your ideal lifestyle.

At different points in life, we must all distinguish between desirable and achievable, so understanding your longer-term lifestyle goals is critical. Lean on your team to show you your options. Through a deep dive into your goals, looking at potential trade-offs and your strategy, your adviser can help provide an informed analysis and perspective on if downsizing your home is a worthwhile consideration for you. If you have ever considered downsizing your home, your adviser and our well-connected team can help you make the right decision with confidence that your financial house and well-being will be looked after.

The information provided on this site is of a general nature only and may not be relevant to your particular circumstances. The circumstances of each investor are different and you should seek advice from a financial planner who can consider if these strategies and products are right for you.

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