Keeping up with the Joneses is a serious affliction. It’s where you refuse to be outdone by your neighbors. They buy a new car. You, too, buy a new car. They purchase a second home. And you, too, feel the pressure to purchase a second home. It can turn into an endless vicious cycle of one-upmanship that, in the end, will do you no good.
So here’s a friendly proposition. Why not go against the grain and let the Joneses do as they please while you lead the life you choose? We can start with the subject of homeownership.
Sure, a five-bedroom house looks good on you. It speaks of your personal successes. You have worked hard and can now afford to splurge on a palatial abode. But is it something you really need?
Bigger house, more work
Living in a big house requires thorough maintenance. There are many rooms to clean and appliances to maintain. That is something you cannot pull off all on your own. You will need the help of professionals.
If you do not mind living with people outside of your immediate family, you can have an in-house cleaning staff. Or you might opt for an army of the on-call house helps. Either way, these require people management on your end.
The same goes for appliance maintenance. For example, your palatial house is most likely outfitted with an advanced HVAC system. That requires consistent maintenance and repair. You’ll need to work with a professional service provider.
Bigger house, more expenses
Because you cannot run a big house all by yourself, you need experts, such as those mentioned above. That costs money. Such an expense is on top of the mortgage you need to pay if you haven’t already paid the house in full.
Also, the more rooms you have, the more appliances you use. That equates to higher utility bills.
You also need to factor in insurance. Plus, the taxes you pay for your property. And the bigger the house, the higher the rates for these payables, too.
Smaller house, more freedom
If you are a retiree, downsizing to a smaller home will prove beneficial financially. You can use the money you make from the downgrade for other expenses. On top of your pension benefits, you will have enough resources to pursue a new hobby. Maybe sign up with that country club you’ve always dreamed of joining and play golf with other retirees?
If you’ve been afflicted with wanderlust, you can go on a cruise. Or better yet, travel the world. Your downsized home will be there waiting for you, smaller but a home nonetheless.
Smaller house, more peace of mind
Downsizing is also a worthy option for empty-nesters. Have all your children left for college or gone working in the big city, and it’s just you and your partner at home, moving through a house with at least three spare bedrooms? Why not put that property in the market, use the money from the sale to purchase a smaller home, and whatever’s left goes to what you deem fit.
You can invest the surplus funds you made from downsizing in corporate stocks or forex. That way, there’s a chance for it to grow. Or you can put in gear the business that you’ve always wanted to pursue. That should keep your and your partner occupied even sans your grownup children. Or if you have debts, now’s the time to pay them and get a clean slate. Whichever way you go, downsizing your home as a financial decision proves smart from all angles.
Our culture tells us that more is always better. We live in a world where having less is frowned upon and considered a symptom of personal failure. But it’s not too late to be freed from this potentially destructive way of thinking. Take a cue from the Dalai Lama.
The Dalai Lama always travels with a small red bag. In one of his public appearances, he was asked about the contents of his bag. Without fuss, he opened the bag and showed what’s inside to the reporters. There were a chocolate bar, a toothbrush, a case for his eyeglasses, Kleenex tissues, and candy in it. That’s all. It’s the aptest lesson in material modesty. One that remains relevant up to this day.
Now, we are not sure what kind of house the Dalai Lama lives in. But it’s safe to assume he lives in a spare and humble abode. That’s something you can aspire to as well.