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Choosing the Empty Nest Go Big Go Small or Stay Home Choosing the Empty Nest Go Big Go Small or Stay Home
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Choosing the Empty Nest: Go Big, Go Small or Stay Home

Insights & Ideas Team •  September 10, 2015 | Home and Family

Imagine: The kids have moved out, and you’re nearing retirement. Your routine and finances are changing. What about your living arrangements?

What will you do with your house? The choice is as unique as your family, priorities and budget. Downsizing to a smaller home may save money and launch your next adventure. Upsizing might be right if you can afford the square footage to welcome family and friends. And if you’re already in a house and “hood” you love, maybe you should just stay put.

Here are some things to consider when deciding which nest is best.

Option 1: Find Advantages in a Smaller Footprint

With the kids grown and flown, you’ll be free to move out of the school district. Downsizing can give you freedom to see the world, experience new things and make new friends. You might even be able to afford a small home in a more desirable location (think island, big city or beach).

But you don’t have to go far. Downsizing in your hometown could let you keep roots where you’re comfortable while adding a vacation home elsewhere or simply reducing expenses.

If you’re channeling funds into kids’ education or anticipating a reduced income in retirement, you might need the financial relief of lower house payments, taxes and utility bills. It’s a good idea to talk to a tax professional to understand the tax implications of trading down for a less expensive property. If you make a significant enough profit on the sale of your home, you may owe taxes.

John and Tamara Fay downsized to a townhouse in Glen Ellyn, Illinois.

“It was a financial decision, 100 percent,” said Tamara. “We could pour everything into another big house or add a second home somewhere warm. I had been emotionally attached to the idea of a family homestead, but we had to be realistic.”

She found the smaller home surprisingly spacious. And it was affordable enough that the Fays could buy a second home in Florida—a new place for their family to explore.

If you plan to grow old in your empty nest, a small, accessible property might also be easier to maintain and more comfortable as you age. Just know that a smaller footprint means less space for guests. You may need to visit your children instead of having them come to you.

Option 2: Go Big with Your Home

If your budget allows and you’re the hospitable type, you might choose a larger house with plenty of elbow room. A supersized home can be the place where friends and family gather for meals, parties, holidays, even whole summers.

Ample square footage also makes it easier to take in family members who need a hand—whether children who boomerang back or older relatives who can no longer live alone.

That was the case for Don and Connie Schenkenberger, who had retired to Pinehurst, North Carolina. When Don’s brother suffered a stroke and needed help in the Midwest, the Schenkenbergers took him in. They relocated to a big house in Fort Wayne, Indiana.

“This put us where we could help my brother-in-law,” said Connie, “and right in the middle of our five children and ten grandchildren.”

They equipped the three-story home with an electric stair lift and accessible suite, giving Connie’s brother-in-law as much independence as possible.

Now, the spacious house is where the whole family congregates.

“No one is more than three and a half hours away—and they all come,” said Connie. “We get to be involved with our family in a way we simply couldn’t from North Carolina. That’s the purpose of this home.”

Option 3: If You’re Already Home, Don’t Move

The house where you’ve raised your children shelters a lifetime of memories, and the longer you’ve called a place “home,” the harder it can be to leave. If seeing your child’s empty room is all the change you can bear, why add the hassle, expense and emotion of moving?

Perhaps you also feel connected to community. You may not want to leave the people and places that are significant in your daily life. Plus, if you have an easy commute to a job you need to keep, moving might not make sense.

Then there’s everything you’ve put into your home. At last, you’ve got things the way you want them (or mighty close). That’s taken time, effort and money. If your home is paid for or the last payment is near, you may soon have breathing room in your budget. With that financial ease, you could take a trip, add to your retirement funds or offer support to your kids.

Helping children save money is why David and Sharon Phillips have kept their house in Oak Park, Illinois. All three of their adult kids have returned for short and long stays. Right now, two live at home, along with a spouse and baby.

“Luckily it’s a big house,” said Sharon. “But when the kids leave again, it will seem too big. For now, it’s right, and I’m enjoying this moment while it lasts.”

Surprising moments—like when the nest is full when you expected it to be empty—are good reasons to revisit your financial plans.

“We sat down with a financial planner and discovered that having the kids back home wouldn’t really add any big expense,” said Sharon. “Our house is paid for, and most other expenses—taxes, utilities, insurance—are basically fixed. The food bill did change, so we just asked for a share.”

So What’s the Right Size for Your Empty Nest?

Choosing whether to downsize, upsize or stay put means getting clear on what you want, what your family might need and what you can afford. By considering all these factors, you can decide which nest is best.

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