Retirement can bring in a lot many changes to your current lifestyle. And one of it could be shifting from a bigger independent house to a condominium. With an ease to maintain, it may also be the most viable and practical option. It also gives you a breather from a high maintenance lifestyle.
Downsizing to a condominium will involuntarily save lots of money; nevertheless a little extra planning can further lower the costs. Following are a few pointers for you to work on:
1. Choose only the Essentials Amenities
Amenities in a condominium are always attached to a cost. Hence choose a condominium that has all the essential facilities and don’t fall in the trap of alluring amenities like a swimming pool, underground parking, gym, salon etc.
2. Decide the Size
Maintenance costs are incurred on per square footage basis. Hence bigger the condominium, higher is the maintenance cost. However a larger building with more number of units means lesser maintenance cost.
3. Condominium Insurance
Shifting to a condominium also requires a shift in your insurance policy. The maintenance fee does cover for the exteriors and the common areas like lift and lobby, but interiors are still on you. So pick a condominium policy that covers whatever is required inside the four walls of your condominium. Not only content but the structure as well. Also decide on how much coverage is appropriate. The thumb rule is to go by half of the market value of interior structures so that in case of a disaster, you have enough to replace. The condominium insurance should also clearly define if its cash value coverage or replacement-cost coverage.
4. Downsize the interiors as well
Smaller accommodation also means smaller furniture. Do not carry the emotional and massive baggage of old things with you to the new house. Get rid of bulky furniture and assess what all will be redundant in your new accommodation. Carry only whatever is essential and fits in the new house. Inform your realtor, neighbors and community about downsizing and arrange for an open-house sale. Whatever is still left and is in working condition, click pictures of those and put online for sale. Whatever is still left, donate it!
5. Transfer the Services
This is very important to save on the crossover charges. Inform the existing service providers of telephone, cable or internet well in advance. Or if you want to get rid of the present service providers, get the new installation appointment as soon as you know the move-in date. Don’t forget to cancel the old services.
6. Reinvent the old Financial Plan
Reinvent the old financial plan to suit your present income and expenses. Ideally, downsizing to a condominium should save you enough money even after paying for maintenance, utility, loans and property taxes. It’s great idea to calculate your income from all sources and make an income v/s expenses comparison. This will give help you to know exactly how much you can spend on recreation activities that you always…