We got married ten years ago. After two kids came in next six years, we thought about moving to a new home. We were living in a rented apartment and determined to shift to a spacious accommodation. Why not get our own home built up? Yes, we did that and finally shifted with bag and baggage in 2010.
We made a heavy investment of our saving for getting our first home built up. With a big basement, larger bedrooms, kids’ toy room, an ample sized kitchen, a larger acre of yard, a garage the two-stored building became a pride of possession for us.
We lacked in prophetic vision at that time. We failed to realize that our needs would not remain same over time. Kids grew up and their toys’ room was left like an additional but unused storage space. Once upon a time, the basement area was used to be the venue of parties that we hosted at least twice every month. For big celebration, terrace was also used. These days, flow of guests is on wane and terrace offers enough space to accommodate them.
Our garage is a big one and two cars can be housed in it. With our two kids now studying in other states, we no longer need two cars at a time. We have planned to sell one car and that means, a part of our garage will have no use.
In a word, a larger part of basement is now left unused. The idea of downsizing our home struck me and we started calculating how much we can save by doing that.
Payment on Mortgage
According to our rough estimation, we could be able to save $500 every month on our mortgage payment by shifting to a new house that is 30% less than what our present home values. We have finally taken a decision in favor of shifting after being convinced that we get to save a larger sum on mortgage payment.
Saving on Maintenance
Big apartment means you have to spend a lot for annual maintenance. What about daily maintenance? Well, that also demands huge expenses. Dusting all furniture items and moping of floor take a lot of time, effort and money. You will not do cleaning work yourself and need help of more than one maid servant. After we shift to our new home, I will do most of the work myself. It will keep me fit and help me save a great deal of money.
Saving on Taxes
Bigger the apartment, higher is tax! At present, I have to cough out $5000 every year. By shifting to a smaller home, I will be able to manage with only $960 every year for property tax. Now you see how much I will be able to save every month on property tax.
Saving on Power & Fuel Bills
We currently spend a little over $300/month for our power bill and natural gas. Sometimes, the figure goes down while other times, it rises. However, the average figure is what I mentioned earlier.
I know when we will finally move, we will be teary-eyed. But as we are convinced that we could save a significant amount every month, we could force a smile on our face.
This is a guest post from Tina Roth. She is a personal finance blogger at PROFinance blog. She is a commerce graduate and loves to write about money and personal finance management.