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Downsizing Tips

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Wednesday, June 15, 2022

Many older Americans are considering making a change to the way they live as they stop working. Research by Ameritrade found that 42 percent of Americans plan to downsize when they retire. Downsizing happens for many different reasons, often financial. No two people are the same and everyone has their own lives to lead. No matter what the reason, should you choose to make a move and change your lifestyle, if you plan on moving to a smaller space you will be going through a range of challenges and emotions. It is a time of transition and it is a monumental task to begin paring down your life. 

The above-mentioned study shows that 17 percent of those who choose to downsize want to get rid of excess commitments so that they can be closer to family and be more involved with their kids and grandkids. The idea of downsizing can feel overwhelming as well as have other social implications. You may feel judged rather than feel you have a sense of freedom. But the fact of the matter is that paring down your life can be a beneficial move. Your lifestyle is more manageable and having a smaller space and fewer bills means it’s easier on your pocketbook. 

William Campbell, Senior Vice President at David Lerner Associates says, “Downsizing can be a positive move especially when you retire. Cutting costs on your mortgage or even being able to live mortgage-free gives you more freedom in your later years. Plan smart and be sensible when you invest and you should be able to enjoy a secure future safe in the knowledge you have prepared for it.”

When you are planning on making the move to downsize you need to take a few factors into account.

  • Will you stay locally or move further away? Will it be a different state?
  • What is the main factor that is behind the move? Is it warmer weather? [1] Ameritrades' research found that of the 42 percent of Americans who want to downsize when they retire, 25 percent want to move somewhere warmer like Florida.
  • Tax breaks? Natural beauty? Or simply to cut down on costs and responsibilities?
  • Do you want to move closer to family or friends? What are the areas nearby that fit your criteria?
  • Do you want to live in a house, condo, apartment, or group living community? Just 6 percent want to move to a retirement community.
  • Do you want to have greater access to a certain activity or hobby (like hiking, skiing, golfing, or fishing)

Downsizing is a really big change to the way you live but it is also a great opportunity to declutter and reignite your passion for life. Fewer distractions mean you can concentrate on the things that matter to you in your retirement. Whether you rent or buy depends on your specific situation.  Don’t be afraid to ask for help from friends, family, and professionals.



Material contained in this article is provided for information purposes only and is not intended to be used in connection with the evaluation of any investments offered by David Lerner Associates, Inc. This material does not constitute an offer or recommendation to buy or sell securities and should not be considered in connection with the purchase or sale of securities.

To the extent that this material concerns tax matters, it is not intended or written to be used, and cannot be used, by a taxpayer for the purpose of avoiding penalties that may be imposed by law. 

Each taxpayer should seek independent advice from a tax professional based on his or her individual circumstances.

These materials are provided for general information and educational purposes based upon publicly available information from sources believed to be reliable-- we cannot assure the accuracy or completeness of these materials. The information in these materials may change at any time and without notice.

David Lerner Associates does not provide tax or legal advice. The information presented here is not specific to any individual's personal circumstances. Member FINRA & SIPC

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Founded in 1976, David Lerner Associates is a privately-held broker/dealer with headquarters in Syosset, New York and branch offices in Westport, CT; Boca Raton, FL; Lawrenceville, NJ; and White Plains, NY. For more information contact David Lerner Associates Call 800-367-3000 Visit our website: www.davidlerner.com

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