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What are The Risks in Downsizing?

risks in downsizing
It's important to carefully examine the key risks in downsizing

Before you decide whether or not you are ready to downsize, you should consider the risks. What are the risks in downsizing? We have compiled a list of the key things you need to think about before you determine it’s the right move for you or not.

Key downsizing risk #1: Less Space

  • If you like to entertain friends, you will have less space to do this. Elaborate parties aren’t that easy to do in a small apartment. If you often host holidays, you will need to think about what that might look like in a smaller home. Additionally, there is less storage space so, all of the dinnerware you’ve invested in for special occasions might not be able to come with you.
  • If you often have visitors stay with you, you might not have the space to accommodate them. If your children and grandchildren don’t live nearby, you may want to have plenty of space for them when they come to visit. Especially if they come often. If that loss is too significant for you, downsizing might not be right for you.
  • While you may see a smaller space as cozy, in reality, you may end up feeling cramped especially if your previous home was large. There are ways, of course, that you can make rooms feel larger, but it’s definitely a risk that you feel hemmed in and catch cabin fever.

Key Downsizing Risk #2: Your Lifestyle

  • Your lifestyle will change completely because everything you do will be different. You will shop differently, you will purge possessions and therefore how you accumulate them will change, you won’t spend your free time the same way or gather in the same way, and you may not be able to entertain as you did before.
  • There is an emotional aspect that you need to work through. You may have decided that you were prepared to let go and move only to realise that this isn’t the case. You’re leaving the home you have spent years in, you raised your children there, and may have seen grandchildren playing in the garden. It’s a risk to let all of that go.
  • You will be moving to a new neighbourhood and a new home. There is a risk that you just don’t fit in or like it once you’re in place. This is why many people choose to rent before they buy – this is a costlier exercise and it means more moving, but it allows you to determine whether the area is right for you.

Key Downsizing risk #3: The Financial Side

  • There are social security implications.
  • For many, their home is a status symbol which means that letting go of that to move into a smaller home is seen as a loss of prestige. If you feel that your home represents your success, downsizing might be the wrong move for you as you risk changing people’s perception of you.

What are The Risks in Downsizing? Only you can truly determine what the risks are for your downsizing project.

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