Retirement Tips

Living Large by Going Smaller: Pro Tips for Pain-Free Downsizing

Retirement is the perfect opportunity to reassess what’s important and make room for the things that really matter — in the literal sense. Whether you’re moving from a four-bedroom to a two-bedroom home or you simply want to have a clean slate going into the next phase, downsizing your physical belongings is a great way to simplify your life.

And while downsizing can feel a bit overwhelming at first, letting go of unnecessary possessions can actually be liberating.

According to author and professional organizer Marie Kondo, “Keep only the things in your home that ‘spark joy.’ Discard everything else.” Easier said than done. But Kondo’s popular book, The Life-Changing Magic of Tidying Up: The Japanese Art of Decluttering and Organizing, has people around the world purging non-necessities to achieve what she terms “the nirvana of housekeeping.”

Since September 27 is International Declutter Day, it’s a great time to take a closer look at the things taking up space in your home.

Divide and conquer…the clutter

When it comes to downsizing, it can be hard to know where to start, according to Deborah Gussoff, a certified professional organizer and residential specialist at New Jersey-based In Order, Inc.

“The key is to take the larger project and break it down into manageable, bite-size chunks,” she explains. “Let’s say you’ve lived in your home for 30 years. That means, unless you’ve been diligent about regular purging and donating, it most likely has three decades of accumulated stuff in it.”

Gussoff suggests beginning with a small project — like your linen closet — and work on paring down until it’s completed.

It’s easy to feel unsure, sentimental and in over your head, Gussoff acknowledges, but you can’t let those challenges stand in the way of your downsizing goals. That’s why she recommends pairing up with a friend or family member to help keep you “focused and on-task to prevent you from going down the memory lane rabbit hole.”

Ready, set, declutter

Ready to let go of some of the belongings you’ve accumulated over the years? Keep in mind these professional tips:

• Don’t wait until the last minute. If you plan to downsize your home in three years, Gussoff recommends starting the process now. Go room by room and get rid of the items you no longer need, use or love. Remember, a house that’s clutter-free shows better to prospective buyers, and often sells faster and at a higher price point.
• Keep your destination in mind. If you’re moving to a warmer climate, you probably won’t need five parkas and 10 wool sweaters; one of each may suffice. If you’re moving to an apartment without a dining room, you can sell or donate your china for 16.
• Don’t let guilt make decisions. Keeping something simply because it was a gift is holding you back. Like Kondo says, if it’s not bringing you joy, it’s time to part ways.
• Give your family a say. There may be items of value or heirlooms that you want to divide equitably among your children or other family members. Use a rotating system where each person takes a turn picking a desired item. It may help mitigate arguments down the road when the estate needs to be split.
• Don’t be afraid to ask for help. Hiring a professional organizer can teach you how to declutter effectively and help you stay on task to conquer your organizing challenges. It will make the process far less arduous and manageable.

Bigger isn’t always better

Empty bedrooms, high utility bills and a large lawn to mow — it’s no surprise that 37% of baby boomers plan to move at some point, and 42% say they would prefer to live in a smaller home.

And whether you're “right-sizing” to a condominium, a 55+ community, or a ranch in Florida, a reverse mortgage loan could be a smart financing choice for purchasing your next home. Available exclusively to homeowners and homebuyers age 62 and older, a Home Equity Conversion Mortgage (HECM) — commonly known as a reverse mortgage — can make it easier to afford the home you really want.

Another loan option, an Equity Elite Reverse Mortgage, is designed for homebuyers as young as 60 years old. It can be an advantageous choice for buyers of higher-value homes, as well as condominium buyers, because more condos qualify with Equity Elite. Available in certain states, this new loan offers loan amounts of up to $4 million, as well as no Mortgage Insurance Premium (MIP) fees — which can mean lower up-front costs as well. There’s also an option called Equity Elite Zero that eliminates nearly all closing costs.^†

Whether you choose a HECM reverse mortgage or Equity Elite: Both loan options can help you get the keys to your new home, without having to drain your retirement savings.

Find your dream home — at any age

If owning a new home is in your future, Reverse Mortgage Funding can help. Call 888-277-1567 and set up a convenient phone appointment to learn more about financing options available to you. You can also email inquires@reversefunding.com.

^†With this pricing option, borrower receives a lender credit covering nearly all closing costs. There is a non-refundable independent counseling fee of approximately $125 on average, which the borrower pays directly to the counseling agency. Terms and conditions apply. Not available in all states.

Equity Elite Reverse Mortgage (“Equity Elite”) is Reverse Mortgage Funding LLC’s proprietary loan program, and it is not affiliated with the Home Equity Conversion Mortgage (HECM) loan program, which is insured by FHA. Equity Elite is available to qualified borrowers who may also be eligible for HUD, FHA’s HECM program or are seeking loan proceeds that are higher than HUD, FHA’s HECM program limit. Equity Elite currently is available only for eligible properties in select states. Please contact your loan originator to see if it is currently available in your state.

Upon a maturity event, any non-borrowing individuals with an ownership interest in the property, including non-borrowing spouses, will have 90 days to purchase the property from the estate or, if the non-borrower inherits the property, pay the loan in full using any sources of funds available to them. Any non-borrowing individual, including a non-borrowing spouse, should have a plan to pay off an Equity Elite reverse mortgage upon the borrower’s death or any other maturity event. If the non-borrower is unwilling or unable to purchase the property or pay the loan in full, there is no protection for the non-borrower (including a non-borrower spouse) to maintain an interest in the home or to continue residing in the home past the maturity event and the non-borrower may be evicted upon foreclosure. The FHA HECM program has protections in place for certain non-borrowing parties, so a reverse mortgage applicant with certain non-borrowing parties should strongly consider a FHA-insured HECM loan (see HECM guidelines or ask an RMF representative for details). Under the Equity Elite reverse mortgage loan program, a maturity event occurs when the last surviving borrower no longer lives in the home as his or her primary residence for at least 12 months, the property charges (including taxes, insurance, HOA dues or any other property charges) are not paid, required repairs are not completed or the property is not maintained, or any other maturity event, as specified in the Security Instrument, occurs.

L2185-Exp092019

Retired? 5 places in the U.S. you will want to visit this fall Getting the Retirement She Deserves