When money is tight and people look to cut their costs, the most appealing ways to save are usually the ones that can be done most easily. People will forgo expensive restaurants, stop making trips to the mall, and cancel their premium television subscription. All these approaches can certainly amount to considerable and worthwhile savings.
But when the need to save money and cut expenses is truly pressing, it sometimes becomes necessary to take more substantial and drastic measures. Among these measures is the option to downsize your home. While putting your house on the market, packing up all your things, and moving somewhere new can make for a difficult process, the savings you get from downsizing will continue to pay dividends long after the move is over. These savings go far beyond the difference in values of a larger home versus a smaller one. Here are some of those savings that anyone is this position should keep in mind:
A chance to start over on the financing front.
A new home brings with it a new mortgage, and your past record of ownership may help you secure a more favorable rate. On the other hand, if you currently own your home you may want to consult an online home calculator to determine whether it’s in your better financial interest to be renting in the first place.
Lower maintenance and utility costs.
A smaller home means that you’ll have fewer wall space, floorboards, and windows that may break or become cracked. It also usually entails a smaller yard and less costly gardening needs. On a similar note, you’ll probably see your heating and air conditioning bill go down when you downsize your home, a savings that can add up substantially over time.
When buying a new home, paying close attention to the assessed tax rate is almost as important as carefully considering the sale price itself. Tax rates can vary substantially between cities, neighborhoods, streets, and individual homes. While you aren’t guaranteed a lower tax burden when you move (especially if you are moving between states or counties) the general rule of thumb is that a smaller home will tend to incur fewer property taxes.
This is certainly not the case in all circumstances, but in many metropolitan areas the average size of a home in a given neighborhoods correlates with greater public transit options. This is because smaller homes usually equate with higher overall densities, and higher densities in turn garner greater train, bus, and rail coverage. Having greater transit options when you downsize can translate into considerable savings if you reduce (or eliminate) your use of a car.
A reason to buy less.
Many people will more freely buy clothes, kitchen items, and pieces of furniture when they know they have a big and roomy house in which to store everything that they want. When your home is smaller, however, you need to be more discerning in your purchases. While you could still use an Airdrie self storage unit to house surplus possessions, a smaller home can still act as an effective deterrent on this front.
School district benefits.
It goes without saying that a new home — especially a smaller, more economical one — could place you and your family in a school district that offers a high-quality public education, therefore saving you considerably on the cost of private schools. But a good school district can bring numerous other savings as well. Many offer free or cheap summer camp, daycare, and after-school programs. Many provide out-of-classroom assistance for children with learning disabilities. All of these benefits can add up to substantial savings.
Park district savings.
On a similar note, you and your family can realize recreation savings when moving into a high-quality park district. Does your new home fall in a park district with a community pool? A gym or recreation center? Tennis courts? All of these ammenities are likely to be offered at discounted rates to community residents.
These are some of the peripheral benefits you can gain from moving, particularly by downsizing your home and exchanging space for some extra money in the bank. Although moving is always a hassle and an expense, the long-run benefits may easily surpass any of the losses — on both core and peripheral levels. Moreover, as the housing market continues to rebound, selling and buying a home will once again become a less difficult feat from a financial perspective. So if you’re struggling to get by in the house you currently have, just remember that nothing is permanent – not even a home – and that moving might make sense from a long-term perspective.