Downsizing Options for Baby Boomers

There are countless variables in life which make it nearly impossible to predict the future. Whether you're talking about your own life, your children's future, or how society will change in coming years, we can only make educated guesses about where any of us will be in a decade or two.

One of the few things we can predict with a high degree of certainty is the continued growth of the senior citizen population. According to the Institute on Aging, the percentage of retirement-age adults in the United States will reach 20% by the year 2030. That's when the youngest members of the so-called "Baby Boomer Generation" will turn 65.

Although the proportion of older Americans will level off after that, the actual number of people in that demographic group will keep increasing. An advantage of growing older in the next few decades is that we will be in good company! As a result, services, societal attitudes, and government programs will likely be more in-tune to the needs of an aging population.

Empty Nest Syndrome

When children grow up and leave the nest, middle-aged parents often look around them and re-evaluate their needs. As more people reach retirement age, a major lifestyle decision many couples will be weighing is the possibility of "downsizing." While they may still want to be able to have enough room for family gatherings and overnight guests, a large home may no longer fit their lifestyle or financial goals.

Buying a condo, cottage, or other type of smaller home can offer retirees a lot of benefits, especially for those ready to scale back on property maintenance. Moving into a gated community or planned development can free you from the burden of lawn mowing, landscaping, and other time-consuming maintenance tasks. Since these potential benefits may also come with restrictions, it pays to fully understand and feel comfortable with Homeowner Association agreements.

There's also the option of purchasing a smaller and easier-to-manage new home in which you don't have to comply with the requirements and fees of an HOA. For senior citizens of all ages, moving to a house that has a smaller yard to maintain and fewer stairs to climb can make life a lot easier. More compact homes also bring with them the advantages of lower heating and cooling costs.

Depending on financial resources and goals, some Baby Boomers decide to keep their family homestead and buy a second property for vacation purposes, rental income, or a combination of both. While that may seem like the opposite of downsizing, costs can be offset by renting the vacation home to reliable tenants or sharing it with family and friends. Owning a second home also gives you the option of transitioning completely to it when you are ready to downsize or relocate.