As I mentioned a few weeks ago our family is considering a move to smaller, more affordable housing in an effort to pay off our remaining debts, and finance a few larger expenses coming up with cash. If we stayed in our current home we would likely have to finance those expenditures (orthodontics, replacement car for my wife, presents and toys for the family etc.) and I would consider that a move in the wrong direction.
We are willing to sacrifice just about anything but school zones, as education is important to us and private schools are an expensive alternative to a quality school system in our current area. It isn’t easy to buy smaller, because most people see that as a step back, when the “American dream” is to constantly buy bigger and better. However, for us it is a personal decision at our family level and we are not overly concerned with what others think. Besides, if we do buy a smaller home and pay it off early, imagine the wealth building we could do with no house payment and no other debts!
The thought of packing, moving and unpacking makes me cringe. When we moved to a new city a few years ago I swore I would never voluntarily move again because it is just such a hassle. However, times have changed and I now see the value in downsizing. I imagine much of what is in our current home will not fit in the homes in our price range, and that’s fine. We’ll have a few yard sales, donate to worthy causes and give away remaining items to friends and family.
On the flip side, downsizing our living quarters should help reduce our monthly bills. Lower house payments, lower utility payments and less maintenance costs should help increase our monthly cash flow towards debt repayment and savings. Our long term, seven-year plan is to pay off this house and our remaining debt and then build wealth like crazy. We’ve lost some ground thanks to bad financial decisions in our 20s, but plan to make up for it this decade by making some sacrifices early on. A paid-for, appreciating home will be a valuable asset in the next decade as the housing market rebounds (and it will). We will then be in a better position to buy or build what will likely become the home we “retire” in.
While we are still a few months out from making a move, a drive around our city Sunday confirmed the neighborhoods we are interested in. We saw several homes in our price range for sale that appeared to be just what we were looking for, but we still have some work to do on our current home before we can pull the trigger. Driving by the houses I could almost feel the “house fever” building inside of me, and I had to remind myself that impatient, impulsive decisions are almost never the right decisions, especially as they relate to finances. We are doing things the right way, and at the right pace.