Dear Reader: First, let me applaud you both for starting to plan your future. Even if you don't make a move for several years, it's great to start the decision-making process now.
There's no question that moving to a less expensive home can reap financial benefits, both in terms of a profit on the sale of your current home, as well as ongoing savings on monthly expenses. However, from deciding where you'll move next to weighing the emotional attachment that you and your kids may have to the family home, there's a lot to consider. Although only you and your husband can truly decide when and if you want to make such a big move, I suggest that you start by crunching some numbers.
ADD UP THE TOTAL MONTHLY COST OF YOUR CURRENT HOME
Start by calculating what you spend each month to live in your current home. Your mortgage may be the biggest expense, but don't stop there. Add in property taxes, homeowner's insurance and utilities. Remember costs for water and garbage collection. Now estimate what you spend yearly for upkeep, not only for the physical repairs but also what you may pay to a gardener or housekeeper.
THINK ABOUT YOUR NEXT MOVE
A smaller home could mean considerable savings on a monthly basis, especially if you move to a less expensive community, so run several scenarios. Will you buy a smaller single-family home or a condo? Would you consider renting? Plug in some rough numbers for each scenario, including possible property taxes, condo fees, upkeep, insurance and so forth, to determine how much you could realistically lower your monthly expenses.
CALCULATE THE PROFIT ON SELLING YOUR CURRENT HOME
Housing has been rebounding in many parts of the country, but don't make assumptions. I suggest consulting with a local realtor who knows your market and can show you recent comparable sales in your area.
Realize, too, that if prices are up for your home, prices are probably up for any other home you might purchase, unless you plan to move to a less costly area.
DON'T FORGET THAT YOU MIGHT OWE CAPITAL GAINS TAXES
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