5 Signs That Downsizing Your Current Home Is All That You and Your Family Needs

Owning a big home has continued to be the dream of many American families. Even though a section of
the population has actually achieved this, a significant number of families are making huge financial
sacrifices to pay for the houses they are living in.

There are times in a family lifecycle when moving into a smaller home could just be the perfect decision
you can ever make. While some people think that downsizing means a step-down, a critical look
presents great upsides, including saving money and time. Below are some signs that it’s the right time to
downsize your current home.

Over 30% of your earnings go to mortgage, property and insurance taxes

Whenever you realize that over 30% of your take-home pay is channeled to insurance, property and
mortgage taxes, it’s time to downsize. It’s unlikely that you will set aside money for savings when the
cost of housings gets to that level. Relocating to a smaller house will definitely save you from the
looming financial disaster.

Cost of repair and maintenance is constantly on the rise

It is estimated that the average homeowner in the US spends about 1%-4% of the property value
towards annual maintenance. It’s a clear sign that you need to downsize if your repair and maintenance
costs exceed this range. Unless you find the cost reasonable, you need to move into a smaller home with
reduced cost of upkeep.

You are not able to upgrade your lifestyle anymore

If you come to establish that your housing costs don’t give you any options and that your life is limited
to certain aspects, it’s time to shift. Your mortgage must never stop you from dining out, going on
vacation or even doing basic upgrades in your home. If this is the case, then it’s time to downsize to a
manageable home.

Too much space in your home

There comes a time in the family lifecycle when children have gone to their homes and what used to be
their rooms is not in use anymore. It’s advisable to move to a smaller home at that moment. This will
definitely lower your annual cost of repair and maintenance.

Housing cost is below 30% of your earning but still unable to save

When your maintenance cost is within the recommended levels and the combined taxes are less than
30% of take-home pay then you should be able to save. If you are still unable to do so and the cost of
housing accounts for greatest expenditure, it’s time to trim down.

Downsizing should be the immediate action whenever you notice one or more of the above signs. It will
not only offer peace of mind but also boost your financial base significantly.