Should I sell my home and downsize or downgrade?

This is a reply to Ruby, a long time reader of ASSI, but it turned out to be quite lengthy.

So, I decided to publish it as a proper blog instead.






Ruby's comment and questions:

My reply:

Hi Ruby,

Of course, the property agent would want you to sell your home and buy a new one (probably from him too). ;p

Ask do you need to sell or do you want to sell your home?





Your home is a freehold property and does not suffer from lease decay.

This is a fact.

Aging freehold property?

I don't understand why is that an issue.





From the perspective of your home holding its value over time, what's wrong with that?

Now, if you need more money for retirement and if selling your home is the only way to achieve this, then, you have to do it.

Then, you can choose to either downsize (rightsize) or downgrade.





You could get another freehold private apartment but one with a smaller footprint if you care about your home holding its value and often people care about this because they want to leave their home as a legacy for their future generations.

I think a one bedroom 500 sq ft apartment should be good enough for a married couple if the space is used efficiently.






If you need the same amount of space as your current home, if you want to stay in Singapore, then, downgrading to a public (HDB) flat is the only way to go and, with the current rules, resale flats are your only option.

As retirees, I guess you don't have to be located in mature HDB estates.

It is a fact that flats in non-mature HDB estates would cost less and this option would leave more money in your pocket.





Also, as seniors, if this is the route you choose, you don't have to be so particular about shorter remaining leases of resale HDB flats as long as the price is right because HDB flats are for staying in and not meant to be a store of value for legacy planning.

You might also want to read the related post at the end of this blog which is about another reader who was thinking of downsizing.

Wishing you good health and good luck!

Related post:
Downsizing our home for better?

Pay for memberships that benefit (who) financially?

Reader says...

I have been following your blog since last year.

As a middle age self employed who’s asset rich and cash poor, I have been enlightened by your simple strategies on how to save money.

Thank you for the kind sharing!





The matter that I need advice :-

As someone who’s very good at spurring the economy I sometimes buy without much thinking.

So recently I paid a small amount (of money) to join a certain membership. Lazy by nature I thought it will be nice to follow someone whose good at what he’s doing.





So there after again I paid some more money to get another set of stock picks mainly the reits.

Last couple of weeks again they tried to sell another membership which members will get access to the CEO’s portfolio which has been widely publicised cos he’s putting his own money in.






Now this membership will cost much more than the earlier ones and as someone lazy by nature I’m thinking if I should join in and just follow what he’s buying.

But this time amount is big ($1999 for one year or $2999 for 2 years), I wonder if you could share with me your view?

AK says...

All I will say is that I have never paid any money to join any such membership.

The one membership which I like which gives me lots of benefits and which is FREE is my CPF membership.





I know.

Bad AK! Bad AK!

Good luck. ;)





Maybe, AK should do that too. 

Each reader pays me $1,000 to know what I buy and sell in the stock market. 

Then, I would have a lot more money to invest with! 

Wah! Mai Tu Liao! 

Related post:
Financial security in Singapore.