Tuesday, January 31, 2017
1. Save Money
The bigger the space we have, the more things we buy to fill every square inch of it! One of the great things about downsizing your home is the ability to stop wasting money on furniture, decor, and home items that are used to fill space rather than to fulfill your life. Downsizing into a smaller home will you help you prioritize your life, with only space for the things you need, you will spend less on random purchases and only bring what is necessary in your life.
As you prepare for the downsize, you will find many things you have and don’t need. As you find these items, sell them on Craigslist or Facebook Marketplace. Depending on how much stuff you have collected to fill all the spaces, you may make thousands of dollars just selling things you don’t need anymore. There is also a good chance your old “large home” will sell for more than your new “smaller home” will cost.
3. Lower Stress
Most homeowners can agree that having a larger home leads to greater stress and upkeep. Time slips away with all the cleaning, home maintenance, yard upkeep and can lead to a home that is stressful and costly. Downsizing your home can be the first step to minimalizing and lowering the stress of your day-to-day life. You will be surprised how reducing your daily to-do list and maintenance will free up your time for leisure activities, spending time with your family, getting more rest, and you just might end up loving your home more than loathing it.
4. Save Energy
If you have ever lived in a large home you know one of the big downsides are the high energy costs. From heating and cooling a smaller space, to fewer electronics and the water savings, you will enjoy lower utility bills year round. A smaller home will also give you the added benefit of reducing your carbon footprint.
5. More Traveling
You might not have thought of it before, but when you leave town it requires a lot of work and planning. With the high cost associated with a larger home there are less funds for travel. Living smaller provides more free time and allows you to save more. If you decide to travel with these newly saved funds, it can be less of a hassle when you need to leave your home for extended amounts of time, especially if you downsize to a townhome or condo. Consider opting for a smaller home that has less upkeep and look for a homeowners association that will maintain the grounds and amenities. This allows you to enjoy the time you’re home and requires less planning, that way there's less to worry about while traveling.
6. New Adventures
For many, downsizing their home can lead to a new chapter in life. Whether you are an empty nester, newly widowed or just looking to change things up, downsizing can start a new beginning. With all this new free time and saved money you might just pick up a new hobby or restart and old one. From the things you could learn, to the places you can see and the people you may meet, a whole new part of life can begin.
7. You Can Splurge
With less space to fill, you can afford to spend a little more on the things you do need. Some people might think of a downsize to mean they are going to live a less fabulous life—think again! Splurge on a few things and/or hire a designer to get the most out of your new space. Your new home may be smaller, but it can be fancier.
8. Debt Reduction
If you’re not just downsizing to enhance your life, you might consider downsizing to get back on track. While it won’t be true for all homeowners, changing to a smaller living lifestyle can help keep you from overspending, overcharging, and the overspending that you may be doing for your large home. A smaller home will help reduce your monthly bills and curb shopping because there isn’t enough space for unnecessary things! If you’re trying to save money, repair your credit and change your ways, consider downsizing your home. Your future self will thank you for it.
9. Earlier Retirement
If you make the right moves, you might find your fiscal independence a lot sooner in life. If you have reduced bills, a higher saving rate and reduced your spending habits, you may find that you can bring an early demise to the ole’ 9 to 5 routine. For more information on this subject, visit the Mr. Money Mustache blog.
Thursday, January 26, 2017
Thursday, January 19, 2017
There’s no more important time to work on your credit score than when you’re about to apply for a mortgage. Improving your credit can save you a ton of money—we’re talking about thousands of dollars over the life of the loan. Here are the actions you can take that will have a notable impact on your score.
Pay down your credit card balances
Credit utilization is one of the biggest factors in determining your credit score. Your credit utilization should at least be less than 30 percent of your limit, and it’s even better if you can get it below 15 percent. This rule applies to both individual cards and your overall credit limit.
It may even be worthwhile to use some of the cash funds you were planning to use for a down payment to pay off credit card balances.
Do no harm
While you certainly want to improve your score if possible, at the very least you’ll want to keep it steady. Avoid opening new lines of credit if you’re applying for a mortgage in the very near future. This will cause a hard inquiry to show up on your credit report.
Take care of negative items
It’s good practice to check your credit report for negative items a few times a year—you can get one free report from each of the three major bureaus (Experian, Equifax, and TransUnion) per year.
If you find any negative items (collections, late payments, etc.), write a letter to the original creditor. Explain the circumstances that led to the negative item, and request that it be removed from your report. It can be surprisingly effective, and removing a negative item will improve your credit score in a hurry. You can find some good templates for a request letter online.