My wife and I moved from Colorado to Florida for various reasons.
We would also lower our monthly expenses.
You see,there are two ways to cash in big-time by downsizing.
Lets dig deeper into this idea, starting with the concept of financially strategic home buying.
The Financial Size of Your Home
You need a place to live, andowning can make sense.
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But what if you already own your home?
Ah, now were getting to the exciting part.Why not sell it and buy something that costs less?
Did you know?
We planned to rent it out but ended upselling it for a profit instead.
Over the long run, rising home valuesdont even beat inflation.
Condos in our complex are currently selling forless than halfof what they sold for nine years ago.
You have the same total assets minus all the costs of selling and buying.
Insurance, property taxes and mortgage loans all go up with the price of a home.
If you buy aphysicallysmaller house, you might alsosave on utilitiesand maintenance.
Does This Apply to You?
Maybe yourerentingat the moment, but who knows what the future will bring?
The U.S. Census Bureau says people average almosta dozen movesin their lives.
Suppose you buy a home for $240,000 with a $40,000 down payment.
A 30-year loan at 4.5% will run you $1,013 per month.
By choosing a smaller house, youll have $1,000 less going out every month.
The possibilities are endless.
And buying a low-priced home to start with isnt about settling for less.
Your Turn: Have you considered downsizing your home?
What was the biggest challenge?
Steve Gillman is the author of 101 Weird Ways to Make Money and creator of EveryWayToMakeMoney.com.
(Can you sense my millennial sarcasm there?)
You know which ones were talking about: rent, utilities, cell phone bill, insurance, groceries…
