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It may sound very easy to simplify your life. You will be surprised to learn that simple and easy are not that close of synonyms. There will be trouble with downsizing, in this post I will explain what some of the problems you face with downsizing.
You Have Too Much Stuff
Even if you try your best to be a minimalist, you will be buying many things throughout your life. Unfortunately, much, if not even all of your stuff you own will have less value to someone else than to you. So either you will not make much money selling your stuff, or you will be holding onto your stuff.
If you want to sell your stuff online, note that many popular e-Commerce sites charge fees for listings, so it will cost money to sell your stuff. Furthermore, there are policies that could mess up your sale. If you want to try to sell your stuff at a yard sale, you may need a permit.
You could still downsize and keep all of your stuff, but the trouble with downsizing then is that you still need storage space for that stuff. You would be surprised at how much of the space in your house you have dedicated as storage for the stuff you never use. If you try to downsize and have no where else to put your stuff, you will have to rent out a storage unit. Why would you want to downsize while at the same time paying around $2,000 annually for said storage unit?
There is a third option, the landfill. If you cannot live with either of these three options, you cannot truly downsize.
Emotions Can Hinder The Sale
You have made many memories with your house. It may be hard to let go. But that will not be the main trouble you have with downsizing.
While you can remodel to increase the value of your home, many remodels do not provide a very large return of investment. Chances are you have made a modification to your bathroom sink, garage, or living room that was purely emotional. Even some kitchen remodels, one of the most well known remodels to raise the value of houses, does not always give you a return of investment. When you become emotional and try to make your home your own, you make your home less for someone else, making it less of an investment.
You Have Not Changed Your Lifestyle Before
If you have not been really able to change your lifestyle to stabilize your finances before, you cannot make what would be the largest lifestyle change very suddenly.
Then again, if you have not made many lifestyle changes for your finances before and you are thinking of downsizing your house, maybe your house is not the issue. You could find other ways to downsize your lifestyle and save you money without all the issues of downsizing your house. Maybe you have sufficient income, but your spending just overpowers your income each time. Try to find ways to cut back. You can eat out less, go on fewer vacations, or fill up less of your house with consumer goods.
Downsizing is not an ideal you can just suddenly try out. It takes effort. You will have to learn how to sell and absorb the costs of being a sales person. You may not be able to emotionally be able to let go of your house and even if you can, you may find that some emotional decisions you have made for your house have lowered the value of your house. Furthermore, you may find that changing your lifestyle is difficult. Downsizing may be a good way to forge your wealth, but you may find other ways of changing your lifestyle can help you out more in boosting your finances.