How Does Loss Aversion Affect Downsizing?

By Tammy ONeil, ACC, CPT CSSC
December 26, 2022

The ability to make decisions is executed from the frontal lobe of our brain, commonly known as the brain’s central command center or as Executive Function. This brain region allows us to plan, organize, motivate, implement, initiate, and execute. But when we avoid decision-making, we make a decision to do nothing.

Loss aversion is an innate feeling everyone experiences at some point in their life and is highly associated with fear. Losses attract more attention than gains.

We fear we won’t find something when we lose it and may grow extremely possessive of objects and refuse to get rid of them.

And yet, the more we have, the more vulnerable we are. The more we possess, the more we stand to lose than to gain.

But regulating our emotions through tactics like taking a different perspective can help minimize the feelings of loss aversion and help us make better decisions about what to keep or give away.

How does loss aversion affect downsizing?

Let’s pretend you’ve lived in your home for more than 40 years, raised a family, and accumulated lots of stuff over the years. You want to downsize from the large, multi-bedroom home in which you currently reside to a small two-bedroom house.

That’s a significant difference! Loss aversion reflects a general bias in human psychology that makes people resistant to change. When we think about change, we focus more on what we might lose rather than on what we might get.

Downsizing is a major life transition! During a time of change, how do we reframe the brain to reflect a positive emotion with change?

1. Be aware of your situation.

2. Consider the value of downsizing.

3. Determine the purpose the items will serve in your new journey.

4. If the item will not serve you, determine who you can bless with that item.

5. Decide to do one thing to start downsizing.

Whether you’re contemplating downsizing into a different home or want to remain where you are, decision-making is a crucial element of planning.

By changing our perspective from “losses” to “gains,” we can:

  • Gain a new home that is manageable and sustainable
  • Gain new friends, new experiences, and a new journey
  • Gain a new sense of self, peace, and fulfillment


Sometimes we need someone to guide us through this time of transition. As a Certified Senior Downsizing Specialist, I manage your move so that you can enjoy your new home with as little stress as possible. I facilitate the downsizing process, so you only take the things you love and bring you joy, honor, and precious memories.

Until next time, stay healthy and have fun!

Contact me for more information about how to manage a Senior Downsizing Move!  (304.834.5678)

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