How to Downsize for Retirement

November 16, 2019

Usually, life on retirement funds is very different from life on a working salary. Depending on how well you saved, if your job provided a pension, and what you receive from Social Security, you may be living on a fraction of your previous income.

Thankfully, your expenses are likely different as well. If you know where to cut back, you can broaden your budget, live more comfortably, and continue to prepare for the future.

Want to downsize for retirement? Here’s where to start:


Housing is one of the greatest expenses in anyone’s budget, sometimes ranging from the recommended one-third of your paycheck to half of your paycheck. Whether you own your living space or rent, downsizing is a viable option to save money.

New Location

Most people live near where they work, but if you don’t have many pressing commitments with set locations, you’re free to seek out more cost-effective areas. Maybe it’s a little further out of the city, which you hadn’t previously considered due to commuting traffic.

New Size

For retirees that once raised a family, downsizing from the multi-bedroom house or apartment to a single bedroom situation is ideal. While a location may hold precious memories for you and your family, it’s typically not worth the extra cost.


If you have a partner in retirement, downsizing from two cars to one can save a great deal long-term – not only on insurance payments, but also future repairs.

Selling one car can also provide a one-time boost to your savings, which can be used on a vacation, be spent on family, or create added buffer room in emergency savings.

It can be hard to give up a car, as it helps provide movement and a sense of freedom. Nonetheless, it’s fairly easy to adjust to sharing a car. It only demands a little extra planning for activities and, should scheduling conflicts arise, the ability to negotiate with your partner.

Daily Expenses

Retirees generally have more time available to them. Unless you’re volunteering, working part-time, or have a very booked dance card, you can use this extra time as a way of saving money.

Most people with full-time jobs feel drained at the end of their day and opt for fast food, pre-made meals, or other ways of saving their time and energy. Retirees can downsize these expenses by using their added time more constructively.

For example, you can opt for home cooked meals instead of take-out. Rather than buying coffee in the morning, you can make it at home. If something in the home breaks, you can spend time repairing it yourself, instead of hiring a professional to save energy.

Early Bird Discounts

Without a job monopolizing and dictating a large portion of your day, you have more freedom in performing errands and activities.

Look for places that provide early bird specials, which working folk can’t take advantage of due to their hours. While the savings may seem minor, they quickly add up over time.


For those with the time and energy to spend, couponing can save your budget. Take the time to sign up for free coupon ads, scour the stores for coupon inserts, and clip and categorize them for later use. With enough strategizing, you can end up saving more money on groceries than you spend.


Downsizing may seem stressful, but it can save you money long-term. This not only helps ensure your retirement can be enjoyed more comfortably, but that you have the funds to spend on travel, family, and all those splurges you dreamed about during your working years.