As you approach your seventies, all sorts of questions surface about how you are going to spend your later years. Sometimes people are trying to help you, others want to sell you something, and those closest to you are genuinely interested in your welfare.

Is your will up to date? Have you got a valid Power of Attorney in place? What are you going to do in your retirement? They are all valid questions to which you should have a ready answer. The first two need to be a definite yes, but that’s a different subject.

The more complex one is are you going to downsize? Sell up the family home where you have probably lived for years, and buy somewhere smaller? There could be financial reasoning of course, particularly for those who haven’t been able to build up an adequate pension pot. For them, it’s a question of making ends meet. It could be a physical reason – the upkeep is too much. Or an emotional one, where you’ve lost a long-term partner and can’t bear to be there without him or her.

A massive decision

Whatever the reason, it’s a massive decision. Moving house is a stressful time and an expensive one. Stamp Duty, legal fees, estate agent costs, moving expenses, etc. add up to a not inconsiderable total. They are enough to suggest to me I’d only want to do it once in retirement, if at all.

There are inheritance tax advantages of downsizing and passing the equity you create onto the next generation, but that’s perhaps a separate article all of its own.

If you listen to economic commentators, they believe that downsizing frees up family homes in a way that keeps the housing market active. They argue there are wasted bedrooms that could be better used by a family rather than a couple, but then maybe they are forgetting about AirBnB and Gold Cup week!

There’s no right answer, of course, but the impact can be substantial.