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Recently, Griffin Miller wrote a terrific piece on retirement downsizing for Bankrate. I’d like to highlight a few of these points here and add a couple of my own.

Downsizing can be an enticing option for many retirees to help lower living costs, there’s more to it than financial considerations. Many need to make their homes more senior-friendly and possibly make their lives easier, others would like some extra money to pursue a new passion in retirement. Whatever the reason, downsizing should be a holistic process – one that considers sentiment and financial pragmatism in equal measures. It’s a chance for a check up on your overall state of being, from your finances to your emotional readiness, from your habits to your social needs.

It is helpful to set up a plan to extinguish debt in all its forms, if possible. However, if eliminating debt is not practical, maybe you can refinance the debt you have to a lower interest rate or better terms that may enhance your situation. For example, maybe your larger home still has a mortgage, but downsizing to a smaller home or condo can provide the opportunity for a smaller mortgage to service or even no mortgage at all. You might also look forward to lower utility costs and less maintenance.

Your next step is a checkup of savings, investments, and estate planning matters. A well-trained financial professional you trust could play a critical role in this part of the downsizing process. While some of these things may seem intuitive, much of it is not, and this is too important to take the learn-as-you-go approach. To that end, it is crucial that you bring these matters to a professional.

Next, consider what you want to do in retirement. While there is nothing wrong with a retirement devoted to travel and leisure, many retirees benefit from continuing to work either part-time or as volunteers. If you think you may want to pursue a working retirement, consider where you will want to be and the options available to you. I’ve found that the magic combination lies in cheaper real estate; desirable weather and activities; travel options; and access to good healthcare options. Also, remember that telecommuting allows countless people to continue their working lives and education from anywhere. Be confident that you are planning far enough ahead. Think about what kind of living circumstances will still look attractive to you when you are 70, 80, or 90.

Talk to your family about your plans. There may come a day when you may need to rely on others for help, and you need to have these conversations well before then. Additionally, if you are considering downsizing certain assets or property that have been in the family for a long time, it is worth discussing this with those that might be affected. It is healthy to acknowledge you don’t need your grandmother’s bureau anymore, but check to see if it can stay in the family before you call Goodwill.

Also, keep in mind that physical downsizing is not something done in a month. Give yourself time to go through each room in your home and prioritize what you are going to need if you move to a smaller place. Make a list of what is going to friends or family members, and what you will donate or trash. Be thoughtful as you consider family photos and other keepsakes that might have high emotional value. This is not just a big moment for you; it is a change that reverberates across your family.

When you do move, chances are you will need to invest in some new household items or furniture to fit with the fresh surroundings. Try to avoid going overboard with this – careful downsizing can be undone quickly by excited shopping.

With a thoughtful downsizing process, you can simplify your life and save money in the process. You can realize the freedom that comes from decluttering your life, and begin this new chapter energized. Maybe it is worth considering.


Investing involves risk and investors should carefully consider their own investment objectives and never rely on any single chart, graph, or marketing piece to make decisions. The information contained herein is intended for information purposes only, is not a recommendation to buy or sell any securities, and should not be considered investment advice. Please contact your financial advisor with questions about your specific needs and circumstances.

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