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Why Downsizing Your Home Can Save You Money

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Just this week, I trimmed down my living space by at least 1,000 square feet. I went from a suburban home with tons of storage to a downtown city loft with practically none. It was one of the best decisions I ever made, and my life has become not only so much simpler, but also way less expensive.

What many people don’t realize is that downsizing and decluttering can save you a ton of money. In addition, it makes your life considerably more stress-free.

So why is it we’re so attached to our “stuff”? Here’s a look at why we can be resistant to downsizing and how letting go of your stuff can save you big money.

Our Attachment to “Stuff”

Before I became a full-time writer, I owned a thriving professional organizing business. My job was essentially to help people declutter and organize their homes.

So I understand completely how attached we can become to our things, as well as why so many of us buy big homes or spend money on storage units to store all our stuff.

Many of our things help give us a sense of identity. For instance, that tower of books helps reaffirm that, yes, we love to read (and it proves how intellectual we are to our friends). Our closets full of clothes reinforce our individualist sense of self. Our antique furniture might help us feel grounded in a way modern furniture just can’t.

We also might inherent stuff from family and friends. These items can have a powerful hold on us. Many times, we can’t let go of these things because they’re a crucial link to a person we love. Stuff can take on a life of its own, especially if it’s given or left to us by someone special. That’s understandable.

The problem occurs when we don’t self-regulate our consumption of stuff or get rid of stuff we no longer need. Instead, when we buy stuff to fill a void in our lives, to make ourselves feel better after a bad day, or because we don’t have anything else to do.

This kind of consumption easily leads to packed homes that require significant investments to keep up. We spend time cleaning around this stuff. We pay a bigger mortgage for a bigger home to store it all, along with the bigger utility costs that come with it. Or we pay monthly for a separate storage unit, where we keep our stuff out of sight and largely out of mind, simply because we can’t let go of it.

In a sense, the stuff we own ends up owning us.

The good news is that you can hop off the consumption train any time we want. And if you do, you just might find you’re happier, have more time, and have much more money in your pocket.

How to Save Money by Downsizing

There are several ways you can save money and have a happier life when you downsize.

1. Save on Home Costs

The less stuff you have, the smaller the space you need to store it all.

The move I just made will save me $260 per month on housing. Because I got rid of so much stuff before my move, I didn’t need such a big space anymore. My savings will add up rapidly.

Stop and think about the size of your home and how much of that space you’re paying to store stuff. You might be surprised at how much your stuff is costing you.

Here’s an eye-opening exercise I used to use with all my organizing clients:

  • Write down the total square feet of your house.
  • Write down how much you pay monthly for your house or apartment.
  • Divide your total square feet by your monthly payment. This is how much you pay monthly per square foot.
  • Now, estimate how many square feet you’re using to store stuff, include your closets, basement, extra bedrooms, and garage.
  • Multiply that times your “monthly square foot” cost.

For instance, imagine your home is 2,500 square feet including storage space, and your mortgage is $1,600 per month. That means you’re paying 0.64 cents per square foot, per month, for your home space.

If you’re using 1,000 square feet of that to store stuff, then your stuff is costing you $640 per month. How much would you save by downsizing to a smaller home with a smaller mortgage payment? You do the math!

2. Save on Utilities

A bigger home means you’re spending more each month to heat and cool the space. Not only is this bad for your wallet, but it’s also bad for the environment because you’re consuming more energy.

You can use the same exercise we just did to figure out how much you’re spending to heat and cool every square inch of your home. Simply take the yearly total of your heating and cooling costs and divide your square footage by that number. Then, divide that number by 12 to see how much you’re paying each month.

For instance, if you spend $300 per month on electricity and heat, and your home is 2,500 square feet, you’re paying 0.12 cents per square foot for utilities. That 1,000 square feet you’re using to store stuff is costing you $120 per month to heat and cool.

3. Save on Health Care

When you live in a home packed with stuff and clutter, chances are your air quality is not as healthy as it is in homes with fewer things. Cluttered homes are almost always dustier and dirtier than uncluttered ones.

They’re also much more difficult and time-consuming to clean. Owning a house full of stuff is often stressful. You worry about it. You groan when you have to clean it or move stuff around. You feel guilty it isn’t more organized. This stress can also negatively impact your health.

Added Bonus: Making Money by Downsizing

Sites such as eBay and Amazon are a boon to declutterers because you can sell your stuff there and recoup some of your investment. I’ve sold several of my used books on Amazon. Last month, I brought in over $250 selling books online. The month before, it was close to $100. And it was a cinch to do.

So as long as you’re decluttering and downsizing, why not find some ways to make a little extra money from it?

Final Word

I know it’s easy to get attached to stuff. And the process of decluttering and downsizing isn’t easy or quick. Even with my professional experience, it took me months of regular decluttering to trim down my stuff, and I still feel like I have too much.

If you decide to declutter and downsize your life, give yourself time and space to do it, and work slowly. Focus on one room, or even one corner, at a time. Don’t haphazardly declutter, because you’ll likely feel you aren’t making progress and quit.

Decluttering and downsizing can be a challenge, but I promise it’s worth it in the end. The more stuff you get rid of, the more you save for the things that truly matter, like living a debt-free life or saving for your kids’ college education.

(photo credit: John Pannell)

Heather Levin
Heather Levin is a writer with over 15 years experience covering personal finance, natural health, parenting, and green living. She lives in the mountains of Western North Carolina with her husband and two young sons, where they're often wandering on frequent picnics to find feathers and wildflowers.

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