Friday, April 3, 2020

4 Times When It's Financially Smart to Downsize Your Home

Many people who are going through a financial struggle, don't tend to think about their living arrangements. They think that because they have a house loan that they're unable to switch. The truth is that downsizing to a smaller home is a great financial move in these types of situations.

You Get A Job With Lower Pay

Whether you've been let go of an old job or simply have decided that your passion is in another field, taking a job with a lower pay maybe something you've decided to do. Along with a lower paycheck comes a smaller budget. Downsizing to a home that has a monthly payment that you can afford is a necessary option to keep your finances in order.

You've Gone Through A Divorce

If you've been through the long-drawn-out process of divorce proceedings, you may fret at the thought of undergoing more paperwork for a mortgage. However, the reality is that without two paychecks supporting the mortgage, you may not be able to do so on your own. 

Even if you can, you may find that you don't want to commit that big of a portion of your paycheck to your monthly mortgage payment. Downsizing to a smaller home with a smaller mortgage payment may be the best financial option for you.

Your Housing Expenses Have Surpassed 30 Percent Of Your Income

The U.S. Government has been utilizing 30 percent as the magic number of what a person's housing expenses should be. If you noticed that your housing expenses exceed this threshold, then it's a good time to consider downsizing. 

According to government standards, anyone paying over 30 percent for housing expenses is financially burdened. Consider moving to a luxury apartment community instead to decrease your housing cost, but still, enjoy living in a fun environment.

You Can't Afford Regular Maintenance

If you find yourself struggling to afford those costs associated with household maintenance, then it's time to consider downgrading. You don't want to live in a home that you're unable to maintain as your home will begin to deteriorate and more costly issues will inevitably crop up. Instead, move into a smaller home that allows you to afford the regular costs associated with maintenance.

Downsizing to a smaller home can be a very strategic financial move for many. The above are just four common scenarios that scream it's time to downsize. The truth is that downsizing can be so beneficial for people on a financial and mental level. It's best to take downsizing into consideration instead of pretending that it's not a possibility to enhance your financial state.

No comments:

Post a Comment

Join 1000's of People Following 50 Plus Finance
Real Time Web Analytics