Wednesday, December 12, 2012

Downsize or Supersize?

Sometimes I think reporters write articles just to start an argument, thereby generating reader interest. Anne Tergesen of the Wall Street Journal recently questioned conventional wisdom with an article entitled, “Everybody Says You Should Downsize. Everybody May Be Wrong.”

For generations young people get married and have children. As these “household formation units” grow they accumulate stuff to house, clothe, and feed a growing family. As mom and dad grow older they earn more money, allowing them to buy the accoutrements of the good life, expensive furniture, big SUVs, boats, and giant TVs. Then the children move away to college or real life leaving the parents with a big house filled with stuff. As they drift towards retirement they begin to think about downsizing. Do two people really need a four bedroom house? We have two sets of everyday china and two sets of fine china. How many plates do two people need? Until the real estate bubble of 2006, the increasing value of a primary residence was a significant part of a retirement plan. People moved to areas where there were jobs after graduation from high school or college. These areas tend to have high real estate prices and high taxes. In retirement conventional wisdom dictated that a couple sell the big house in the expensive area and move to a smaller house in an inexpensive area or even into an apartment. The capital gains generated by the sale of their house was then added to their income producing assets to help support an important part of the American Dream, “retirement with dignity.”

There are the obvious reasons for not following this path. If your house has crashed in value past the point where its sale would generate enough revenue to justify the cost (including the emotional costs) of relocation, it makes more sense to stay put until the market recovers. In some cities, Detroit comes to mind, there is no point in waiting for a recovery. However, in suburban Washington I believe that patient money invested in single family homes will not go unrewarded. I really don’t think the Federal Government is going to become smaller or less important in the foreseeable future.

I have always loved big yards with lots of trees, but to be perfectly honest, yard work never amused me all that much. Today, I can no longer do the climbing necessary to trim branches or trim the 8 foot hedge that stood in front of my house for over 25 years. Even walking behind a lawnmower requires a break or two before the yard is finished. Does mom really want to clean all those empty rooms for the rest of her life? Can she? When we move I don’t plan on doing any more yard work. Will I really be willing to pay someone else to do something I can still do myself?

Then there is the stuff. After 25 years in the same house we have accumulated a lot of stuff. We don’t use half of it on anything like a regular basis. In addition readers of this blog know that after my mother in law’s death we put all her stuff into a storage unit. My mother in law managed to pack most of the stuff from a three bedroom house into a two bedroom apartment. Now we have two mountains of stuff. It isn’t just stuff. It is stuff chained to memories of a lifetime. It is easy for me to tell my wife, “Don’t even open that box of photographs. Just throw it away,” but that isn’t going to happen. Recently we spent a week living in a hotel near that storage unit trying to figure out what to do with a mountain of stuff. It isn’t easy. We finished about 1/3 of what needs to be done. My wife wants some of her mother’s stuff. Our house is at the point where topology is an issue. The mathematics of space has determined that for every new piece of furniture added to our house a piece of furniture must be removed.

Until this conundrum is resolved the storage unit costs the estate $188 a month.

Anne Tergesen observes, “In recent years, new breeds of professionals have sprung up to help people declutter, organize and move their possessions. Among their recommendations: sort your belongings a little at a time so you don't get overwhelmed; don't make judgments about what your spouse should or should not keep; and take only what fits your current lifestyle.” We are actually using the services of such a professional and her partner. This woman handled moving my mother in laws possessions into storage and is arranging estate sales to dispose of the more valuable material we neither need nor want.

One of these advisors, Ann Bass of Asheville, N.C. recommends that your new house gives both husband and wife some personal space for their personal stuff and their hobbies. The old joke says that in retirement a wife gets twice the husband and half the money. Psychologists state that the first year of retirement is the second most stressful year of a marriage after the first year following the birth of the first child. Plan on providing personal space for both the husband and wife to store their tools and to pursue their hobbies in your retirement home, unless you really like to fight. A woman we know proposed moving from a one story house to a two story retirement home so she would have a place to store a huge collection of children’s books she has accumulated over a lifetime (really). Mercifully, at least in this case, sanity prevailed.

I don’t expect that we will be able to downsize. I will be relieved if we can avoid supersizing our new home to contain all the stuff that my wife would like to retain. I would encourage my readers, especially young couples that life does not consist in an abundance of possessions. What is really important can’t be weighed or measured. Those things are held in your heart or your arms.

Luke 12: (NIV)

13 Someone in the crowd said to him, “Teacher, tell my brother to divide the inheritance with me.”

14 Jesus replied, “Man, who appointed me a judge or an arbiter between you?” 15 Then he said to them, “Watch out! Be on your guard against all kinds of greed; life does not consist in an abundance of possessions.”

16 And he told them this parable: “The ground of a certain rich man yielded an abundant harvest. 17 He thought to himself, ‘What shall I do? I have no place to store my crops.’

18 “Then he said, ‘This is what I’ll do. I will tear down my barns and build bigger ones, and there I will store my surplus grain. 19 And I’ll say to myself, “You have plenty of grain laid up for many years. Take life easy; eat, drink and be merry.”

20 “But God said to him, ‘You fool! This very night your life will be demanded from you. Then who will get what you have prepared for yourself?’

21 “This is how it will be with whoever stores up things for themselves but is not rich toward God.”

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