Downsizing during retirement can help you reduce costs and put some more money in your pocket so that you feel more secure about your finances during retirement.
Downsizing by selling your property has advantages and disadvantages, which you should evaluate before making this decision.
From 1 July 2022, eligible individuals aged 60 years or older can choose to make a downsizer contribution into their superannuation of up to $300,000 per person ($600,000 per couple) from the proceeds of selling their home.
For downsizer contributions made before 1 July 2022, eligible individuals must still be aged 65 years or older at the time of making their contribution
On 3 August 2022, the Treasury Laws Amendment (2022 Measures No. 2) Bill 2022 was introduced into Parliament. In this, the Government has proposed that the downsizer eligibility age be further reduced to 55 years. This measure is not yet law.
Downsizing has financial benefits, but it does come with emotional costs and is a fairly significant decision to make. It may not be a solution for everyone, but it is one that you should consider carefully.
It is important to discuss the implications with your advisor and, perhaps also, your family members before determining how you will proceed.