While it's true that we live in a society that often holds that "bigger is better," it can be worthwhile to shift your thinking and consider whether a smaller home would actually serve you and suit your lifestyle.
Potential Advantages of Downsizing
Increased cash flow:
If you're spending less on your mortgage payment, you are likely to have money leftover every month to allocate for other needs or desires. Or perhaps you could pay cash for a smaller home from the proceeds of your existing home.
Fewer rooms and smaller spaces cut down on the time expended to clean and maintain. Smaller homes can reduce the time spent on household tasks, leaving more hours in the day to do something else more enjoyable. In fact, when asked about their primary reasons for downsizing, 36% of baby boomers, 18% of Gen Xers, and 19% of millennials said they did so because their previous homes were too difficult to maintain.1
Lower utility bills:
It costs a lot less to heat or cool a smaller home. Typically there is no wasted space, such as vaulted ceilings, in a smaller home. Less square footage decreases the amount of energy expended. Reducing energy is better for the environment and helps to keep your home green.
If there is no place to put it, you're much less likely to buy it. That means you may acquire less clothing, food, and consumer goods.
Less responsibility, smaller workload, increased cash flow, and greater flexibility—added together, they all reduce stress. Homeowners who have successfully downsized sometimes appear happier when they're no longer overwhelmed by the demands of a larger home.
Potential Disadvantages of Downsizing
Moving to a smaller home would probably result in selling, giving away, or throwing out furniture, books, and kitchen supplies. You'd have to sort through and empty out the garage, basement, and attic. Some people form emotional attachments to stuff and can't part with any of it.
No room for guests:
Hosting a huge holiday dinner might be out of the question in a smaller home. Out-of-town guests might need to stay at a hotel when they come to visit.
Some homeowners report feeling cramped because there is less space in which to maneuver. It's hard to get away from other family members and enjoy private, quiet time because there are fewer rooms to escape to when needed.
Sometimes appearances are more important than comfort levels. For homeowners who place a great deal of importance on how they are perceived by others, a smaller home might not project a coveted image of financial success.
Especially for long-term homeowners, trading down means changing a lifestyle, and some people are resistant to change. There is a certain comfort level obtained by staying with what is familiar.