Clayton Blog

Downsizing After Retirement: A Strategic Move

You’re retired! Time to bury the alarm clock, shred the neckties and hit the open road.

 

But what about your house? It’s a big decision. Fortunately, there’s never been a better time to downsize!

 

Typical Transition Questions

Retired Woman on Manufactured Home Porch

 

You may find the idea of downsizing after you retire overwhelming at first, and you’re not alone. According to a 2004 study1, about 36% of 50-65 year olds are open to the prospect of finding another place to roost after retirement.

 

The intrinsic value of a family home cannot be understated, but is it practical? Here are a few things to consider:

 

  • How much time do you spend in every room in the house?

  • Is a large portion of the house dedicated to storage or simply goes unused?

  • Is it costly, inefficient or difficult to maintain?

 

The Goal of Downsizing

 

The purpose of downsizing is to find a living situation that is most appropriate for your needs. For most retirees, a large house can be a burden.

 

Downsizing to a smaller home often means less maintenance, which frees up time and energy to enjoy retirement!

 

A Great Downsizing Solution

Retired Couple Downsize Clayton Home

 

Clayton offers a variety of manufactured housing options.  If you own land or have a destination in mind for retirement, a manufactured home can be a great option!

 

Clayton will work with you to design a home that fits your style and needs. And best of all, you get to choose the view!

 

The Best Part? Freedom

 

Probably the biggest upside to your largest asset and finding a smaller home is financial freedom. You’ve planned for retirement over a lifelong career. Downsizing offers an opportunity to grow your savings and free up funds so you can thrive in retirement. So why now?

 

Boom Time for Boomers

Couple on Porch Manufactured Home

 

Interest rates currently remain low, prices are relatively stable in most areas and people are buying again. Downsizing now may prove to be a good investment, which will go a long way toward securing your future in retirement. Not to mention, it’s an opportunity to seize a low interest rate while it’s available if you decide to finance your home purchase.

 

Your Nest and Nest Egg

 

Padding your nest egg with the proceeds from a home sale is an option for helping create a financially secure retirement.

 

According to a report by the Government Accountability Office, about 55% of Americans aged 55-64 have less than $25,000 saved for retirement.

 

Selling your home and downsizing to a Clayton manufactured home is a great way to add to your retirement savings or free up funds for investment! Before selling your home or property, be sure to check with your tax advisor about possible tax liability.

 

Freedom on a Fixed Income

Happy Older Couple

 

Monthly expenses are a fact of life and typically, the bigger the home, the higher the cost. In 2015, an average retired individual received about $1300 per month in Social Security, according to data from the Pension Rights Center.

 

The Pension Rights Center also indicated that about 85% of adults 65 and older receive Social Security benefits and about 65% also receive income from assets.

 

Downsizing can significantly reduce the amount you pay each month for a mortgage, escrow for taxes and insurance and even the cost of utilities. This can be helpful if you no longer receive income from earnings and rely on Social Security benefits.

 

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So be adventurous! Make the most out of your retirement and embrace a new beginning by downsizing to a more manageable home.

See Clayton Homes Less Than 1,000 Sq. Ft!

  1. "The Future of Retirement Living." Metlife.com. June 2004. Accessed December 16, 2016. https://www.metlife.com/assets/cao/mmi/publications/studies/Future-of-Retirement-Living.pdf.

Topics Financial