I'm a tax strategist who's spent 19 years helping everyone from startups to $100M companies, and I've worked with dozens of clients through downsizing situations. Here's what nobody talks about: the tax structure of how you own your new property matters way more than the property itself. Most people downsize and buy their smaller home outright because it "feels safe"--I had a client couple sell their $650K home, pocket $400K in equity, and buy a $250K condo cash. Huge mistake. They lost access to mortgage interest deductions and tied up capital that could've been working for them. We restructured them into a small mortgage, redirected that freed-up cash into their existing side business (she did consulting, he had rental properties), and suddenly $150K of what would've been locked in home equity became business deductions. They saved $8,400 in taxes the first year alone. The hidden cost everyone misses: moving from a house to a condo or HOA property means you're trading deductible expenses for non-deductible ones. Your old home's repair costs could partially offset business income if you had a home office, but HOA fees? Not deductible for most people. Before you downsize, calculate what you're actually losing in write-offs--I've seen that swing be worth $3K-5K annually in lost deductions. If you're downsizing with any kind of side income or business, even part-time, set up your new smaller space to maximize your home office deduction from day one. I teach clients the 45-minutes-a-day, 3-5-days-a-week rule to qualify for business deductions. That approach turned one client's downsizing "savings" from $200K in equity into $200K plus an extra $6,800 in annual tax savings that keeps compounding every single year.
How can homeowners maximize their financial outcomes when downsizing from a larger to a smaller property? The timing of the sale is crucial than many individuals think. I have also seen clients leave the shop six figures better off just by listing in late spring when there is a tightness in the inventory and the buyers are motivated. Check your property prior to listing in order to resolve any problems beforehand instead of during the talks where buyers would use it as leverage points. Things are interesting in math with taking capital gains exclusions into account. Gaines excluded by single filers $250,000 in gains or by married individuals $500,000 provided that the amount earned the exclusion with two of the past five years residing in that same home. A few sellers are unaware of the fact that they may possibly pay taxes deferral in the context of a 1031 exchange in the event that they are relocating into an investment property. Herein lies the difference that makes the difference; negotiate your next purchase and sell. One of my clients had just entered into a 60-day rent-back on a sale, which allowed them to close on their downsized house without being a two-mortgage consumer and hastening to find transitional accommodation. That had spared them an estimated bridge financing and a relocation expense of about 8,000. What common financial mistakes or hidden costs should people watch out for when downsizing? California has something to catch an individual regarding transfer taxes. You pay either $1.10 per 1000 dollars of sales price or possibly some city transfer taxes on top of this depending on which county you live in. That can translate to an additional cost that you had not budgeted in some markets in the Bay Area. The HOA fees in some smaller properties, especially the condos, can be more than what you have paid in the property taxes on your big house. I have seen downsizers pack into a condo believing that they will save money only to be struck with monthly HOA payments not to mention special charges. Have a look through the HOA financials and make sure they have a reserve fund. Not all capital investments that you have undertaken are dollar-to-dollar worth. Probably that kitchen remodel would only contribute a fraction to your sell price based on the buyer preference and comps in the neighborhood.
Great question--I've worked with small business owners for 40 years as both a CPA and attorney, plus spent 20 years as a registered investment advisor, so I've seen every angle of these transitions. The downsizing conversation comes up constantly with my clients approaching retirement. Here's what almost nobody considers: the tax torpedo from selling your primary residence. Most people know about the $250K/$500K capital gains exclusion, but I had a client in Jasper who sold their $600K home, banked a $350K gain, then got hammered because that extra $100K pushed them into higher Medicare premiums (IRMAA) for two years AND made more of their Social Security taxable. Cost them about $8K they never saw coming. If you're close to those thresholds, sometimes it's smarter to sell in a year when your other income is lower, or even consider a charitable remainder trust if you're charitably inclined anyway. The freed-up cash mistake I see most? People park it in savings "temporarily" while they figure things out, then inflation eats 3-4% annually while they're getting 0.5% interest. One couple I worked with freed up $200K from downsizing but waited 18 months to invest it--cost them roughly $35K in opportunity cost during a market recovery. My rule from managing client portfolios: have your investment strategy mapped out BEFORE you close on the sale, even if it's just a simple three-fund portfolio. Don't let emotional decisions about "keeping it safe" rob you of compound growth. The hidden cost that kills people is underestimating their true ongoing expenses in "cheaper" living. I had clients move from a 3,000 sq ft house to a 1,200 sq ft condo thinking they'd save a fortune. Their property taxes and utilities dropped, sure, but the HOA was $485/month, they lost their workshop so started renting storage ($140/month), and they ate out constantly because the tiny kitchen drove them crazy. Their actual monthly savings? About $200, not the $1,200 they projected. Track your real lifestyle costs for 90 days before deciding how much home you actually need.
I've met plenty of homeowners who tell me the same thing: "We love our home, but it's too much house for where we are in life." Downsizing sounds simple... sell the big home, take the profit, and move into something smaller. But like most money decisions, the real impact shows up in the small details. When you downsize, it isn't only about finding a smaller place. It's really a chance to turn years of home equity into something more meaningful: freedom, flexibility, and financial breathing room for the next phase of life. The first thing I often share with clients is to look past the sale price. Many people focus on how much cash they'll walk away with, but the bigger win comes from what that money can actually do for them. Letting it sit in a checking account may feel safe, but over time, inflation quietly eats into its value. A better approach is to create a simple plan: keep some money accessible for comfort and use the rest to support long-term goals like retirement income, travel, or helping family. For example, if a couple frees up $400,000 from selling their home, we might design a mix that covers both stability and growth. Part of the funds could create a dependable stream of income each month, while the rest could be invested in a way that keeps the money working for them. The goal is balance ... not taking unnecessary risk, yet keeping the potential for progress. That said, there are common traps to avoid. People often underestimate how much the process costs — realtor commissions, updates before selling, moving expenses, or unexpected taxes that come from timing income in the same year as the sale. Some rush into a new property before thinking through how the purchase affects cash flow or future flexibility. Others blend sale proceeds with everyday accounts too early and lose track of how that money should be managed. Another mistake is letting emotion take the lead when choosing the next home. Moving should reflect what truly matters now... your daily comfort, community, and peace of mind. Rather than trying to recreate the past. The new space should support the life you're building, not the one you're leaving behind. The best results come when downsizing is treated as a thoughtful life decision instead of a quick real estate move. Before you list your home, talk through the numbers and possibilities with someone who can see both the financial and emotional sides of your plan. Done right, downsizing can be more than a move.
1. I always tell homeowners that downsizing works best when you treat it as a full financial transaction (not just a "move"). It's best to start with a proper professional valuation instead of an online estimate. Even small mistakes in local pricing can cost you tens of thousands. Also, define your financial goal before you list: paying off debt, boosting your pension fund, or freeing up cash flow. When you buy smaller, factor in council tax bands, HOA or management fees, and ongoing energy costs. I've had experience with people who'd downsize in space but upgrade their postcode, which completely wiped out their expected savings. 2. I strongly advise to ring-fence the equity immediately. Split it into three parts: liquidity for emergencies, investment in a diversified portfolio or bonds, and future needs like care, travel, or family support. This balance will stop you from spending emotionally and will keep long-term stability your priority. 3. The issue is that people often overlook agent fees, stamp duty, and the cost of making the property sale-ready. Another trap is emotional purchasing, choosing charm over practicality. That's why you always need a clear plan that will turn reduced square footage into expanded financial freedom.
For me, when homeowners decide to downsize, the key to maximizing their financial outcome starts before the sale. Ttoo many people rush into listing without preparing the property strategically. Simple updates like fresh paint, decluttering, and small improvements, can create a big impact and help you capture top market value. I also encourage my clients to time their sale carefully based on local market trends. Even within the same city, the right season or week can make a meaningful difference in the final sale price. Once you've sold and freed up equity, it's important to be intentional with that capital. For some, that means buying a smaller, more manageable home in cash to eliminate a mortgage payment; for others, it might mean reinvesting part of the proceeds into income-producing assets like rental properties or diversified portfolios. In my experience, the best long-term outcomes come from balancing security (owning your next home outright) and growth (letting part of your equity continue to work for you). As for common mistakes , one big one I see often is underestimating the costs of moving and transition. Between repairs, agent fees, moving expenses, and potential tax implications, the net proceeds can shrink fast. Emotionally, some homeowners also overestimate how much "smaller" they're comfortable going, which can lead to regrets or another move soon after. Downsizing isn't just about living smaller, it's about living smarter. With the right planning, it can free up equity, reduce stress, and strengthen your long-term financial stability. Jack Ma Founder & Realtor, Jack Ma Real Estate Group https://jackmarealestate.com
One often major overlooked opportunity is to do a 1031 exchange and pay zero capital gains taxes. To do so you would need to convert your home to an investment property. The simplest way to do that is to rent it out for a year or so before you sell. This changes the status from your primary residence to investment property, then you can do a 1031 exchange. If you have significant equity built up, that you do not want to get taken to the cleaners on in taxes, One strategy, could be to refinance your house with a home equity line of credit, use that loan to buy your downsizing home or just rent the smaller house while you rent your larger space and net the difference income. You would likely be able to use deprivation so you don't have to pay taxes on it. A year later you can sell your larger home and exchange it into professionally managed properties in a DST (Delaware Statutory Trust) or buy a more income producing property like a four plex. Now you are earning tax sheltered income from the equity that wa sin your home while preserving the equity. Compare that to paying capital gains tax and then reinvesting in the stock market or bonds would likely take you 5- 10 years just to make up for the lost taxes.
"Downsizing isn't about having less it's about making what you have work smarter for your future." When homeowners downsize, it's not just a real estate move it's a strategic financial decision that can significantly strengthen long-term stability. The key is to treat the freed-up capital as an opportunity to realign priorities, not as disposable income. Smart homeowners often reinvest part of the proceeds into diversified assets such as low-risk bonds, dividend-generating funds, or even smaller rental properties that can create steady income streams. It's also wise to clear any high-interest debt before chasing new investments. The most common mistakes I see are underestimating moving and renovation costs, and overestimating how much "extra" cash will truly remain after fees and taxes. A well-structured plan ensures that every dollar from the downsize continues working for you, not just sitting idle.
Homeowners downsizing must approach the process as a Mandatory Capital Reallocation Audit. Maximizing financial outcomes requires absolute focus on eliminating latent liabilities in the larger property before sale. This means funding all necessary repairs and cosmetic fixes to ensure the asset achieves OEM quality presentation, justifying the highest possible closing price. Do not sell an operational liability. The money freed up must be treated with the Zero-Risk Investment Mandate. The capital is not for immediate consumption; it is for generating long-term operational solvency. The funds should primarily be deployed to eliminate all high-interest debt, such as consumer credit, which is an immediate drain on financial capacity. The residual capital should be placed in low-volatility, verified instruments that prioritize capital preservation over speculative growth. This protects the core financial asset. The most common financial mistake is the failure to calculate the Total Operational Cost Transfer. People focus on the mortgage difference but ignore the hidden costs of the new property: HOA fees, higher tax assessments, and the cost of replacing furnishings that do not fit the smaller, optimized space. The major hidden cost is the capital gains tax if the sale exceeds exclusion limits. Consult a specialist to enforce the Tax Liability Mitigation Protocol before signing any contract. Treat the entire transaction as a strategic effort to secure your financial integrity.
Downsizing can be a smart way for homeowners to get more out of the equity they've built over the years. I've helped many people make this move, and it often comes down to timing and preparation. Understanding the local market and being clear about what you want next can make a big difference in how much you gain from the sale. When that larger home sells, the money that's freed up can open a lot of doors. Some people use it to pay off a mortgage or reduce debt, while others see it as a chance to invest or simply create a stronger financial cushion. A smaller property usually means lower maintenance costs, which often leads to less stress and more freedom to enjoy life. There are still things to plan for. Moving expenses, small repairs, and property taxes can catch people by surprise. I always encourage homeowners to look at the full picture before they list their home, so they know exactly what to expect. With the right preparation, downsizing can create both financial stability and peace of mind. At the end of the day, it's about making thoughtful choices that fit your goals. A smaller home can feel like a fresh start, and if it's handled carefully, it can set you up for a more comfortable and secure future.
Approach the move like a strategic investment, not just a lifestyle shift. I've seen how freeing up equity can open new opportunities, but only when handled thoughtfully. Before listing, it's important to understand the true market value of your home and all selling costs involved. Many sellers underestimate expenses like agent commissions, repairs, and closing fees, which can quickly erode profits. That's why some choose a direct sale because it eliminates many of those costs and speeds up the process. Once you've sold, don't let that freed-up cash sit idle. Diversify where it goes: paying down high-interest debt, building an emergency fund, or putting part into long-term investments. One of the biggest mistakes I see is people underestimating transition costs: moving fees, new furniture, or unexpected maintenance on the smaller property. Those can add up fast. Downsizing should feel like a financial reset. When done right, it's a chance to create long-term stability, lower ongoing expenses, and regain flexibility in how you live and invest.
People frequently realise how closely their wealth is linked to their house while they are downsizing. While releasing equity has great potential, long-term stability depends on how successfully you convert that equity into flexibility. The opportunity to lower fixed home expenditures is the largest financial advantage of downsizing. Reduce your monthly obligations as much as you can if you wish to maximise your results. You have more power when you have a reduced mortgage or no mortgage at all. I advise people to view downsizing as an opportunity to rethink their financial plans. If you spend the money you free up wisely, it may be a turning point. You will receive a guaranteed return that frequently exceeds the market if you pay off high-interest debt. The long-term value of that equity can be extended far beyond what it would be in a savings account by funding tax-advantaged accounts like IRAs and HSAs. Building a prudent broking portfolio with a portion of the income can help protect against growing living expenses if you already have a sound retirement plan. The emotional cost of downsizing is one aspect that is often disregarded. People are under pressure to replace furniture that is still functional or update a new area. That's usually where the spending snowball begins. Moving difficulties, storage, property transfers, new insurance policies, and any problems discovered after closing can all result in unforeseen expenses. You can avoid dissatisfaction and maintain the integrity of your financial strategy by planning for these with a reasonable buffer. It's not always the case that the homeowners who profit most from downsizing are also the ones who sell for the highest price. They typically have the best idea of what will happen next.
If you want to get the most out of downsizing, start with a careful look at both your current market and the area where you plan to buy. When you sell while demand is high, you usually walk away with more money in your pocket. Choosing a new home with an efficient layout and lower maintenance costs can keep your quality of life high without sacrificing comfort. Smart timing and careful selection help you avoid unnecessary expenses, like overpaying for repairs or getting locked into a property with high fees. Also, take advantage of tax rules that might let you exclude some capital gains or reset your property taxes, so you keep more of what you earn. Once you have the proceeds, direct some of that cash to high-interest debt. Paying off credit cards or personal loans with double-digit interest rates frees up money every month and improves your financial health. Adding to retirement accounts like an IRA or 401(k) lets you build long-term security, while a strong emergency fund gives you breathing room when surprises come up. Diversifying your investments can help protect and grow your wealth over time. Don't forget about health and long-term care insurance. Medical bills can wipe out savings fast, so planning ahead preserves what you have worked for. People often miss transaction fees and moving expenses, which can take a bite out of your profits. Even smaller homes sometimes carry higher HOA fees or maintenance bills. Rushed decisions based on emotion or a failure to adjust your estate plans can cause issues later. Finally, review your insurance, since your needs may change after you move.
When you approach downsizing as a business choice, it works best. There should be a clear plan because you are reallocating capital and selling your largest asset. Homeowners frequently overlook the cost of liquidity in favour of obtaining the best price for their property. The discount you receive on your house if you sell in a buyer's market may be far greater than the money you save by relocating sooner. You may be in a better negotiating position if you wait for inventories to tighten. You shouldn't let the equity you unlock sit around. I help people divide their earnings according to their goals. Put money away for your emergency fund. Depending on your time horizon and risk tolerance, set aside an additional amount for long-term investments. Consider allocating a portion of the earnings to short-term Treasury bonds, dividend-paying ETFs, or municipal bonds to generate passive income streams if you are retired or nearing retirement. These don't require you to take money out of principal to cover living expenses. Underestimating new living expenses and careless spending are the major errors. It's a common misconception that smaller homes are necessarily less expensive. That isn't a given. Association dues may surpass previous maintenance expenses if you move into a condo. Your utilities and property taxes may increase if you relocate closer to the city centre. Additionally, I witness folks overspending on new home furnishings. Your equity won't go as quickly than anticipated if you have a clear budget with accurate cost projections.
Over the years, I've seen how downsizing can unlock real financial freedom — but only if you approach it with a plan. First, it's important to get a clear sense of your current home's value and what your next home will actually cost. People often underestimate how much things like agent fees, closing costs, or even moving expenses can eat into their profit. And if you're buying before selling, timing becomes everything. The longer you're carrying two properties — even for a few weeks — the more those costs can add up, from double mortgage payments to overlapping utility bills. Downsizing isn't just about the one-time cash boost. It's also about setting yourself up for the long run. Smaller homes often come with lower property taxes, less maintenance, and lower utility bills — all of which add up to real monthly savings. But the real magic happens when you put the money you free up to work. Whether it's paying off debt, topping up your emergency fund, or investing for retirement, every dollar has potential. I always recommend starting with the basics: make sure you're covered for unexpected expenses, reduce any high-interest debt, and then look at longer-term investments. That's how you create absolute financial stability. One thing I often tell people is not to treat the freed-up cash like a windfall. It's tempting to spend it on upgrades, new furniture, or an extended vacation — and there's nothing wrong with enjoying a bit of it. But if you want the move to really pay off, it helps to find a balance between lifestyle upgrades and long-term goals. Setting aside a portion for enjoyment and putting the rest into something that grows over time is a great way to do that. I've also seen people run into a few common traps when downsizing. One is underestimating the costs of the new home — especially if it needs repairs or updates right away. Another is ignoring the tax side of things, like capital gains if your old house has appreciated a lot. And finally, there's the emotional side. Letting go of a home filled with memories is tough, and it can lead people to either hold on too long or overcompensate by spending more than planned on the next place. At the end of the day, downsizing should be about simplifying life — and strengthening your finances. If you go into it with clear goals, a bit of patience, and a plan for how to use the money wisely, you'll come out of it not just with a smaller house, but a much stronger financial future.
I'm Art Putzel, managing partner at a commercial real estate firm since 1987 and a CPA. While I focus on commercial properties, I've seen enough lease negotiations and property transactions to spot the financial traps people miss when downsizing. The hidden killer is timing mismatch with capital needs. I once had to negotiate a tenant out of a lease early, and the costs were brutal--they owed the remaining term plus our commission got complicated. When you're downsizing, if you need to break a lease or sell before your mortgage terms are favorable, you're lighting money on fire. I've seen people lose 15-20% of their equity just in early exit penalties and overlapping housing costs. Map out exactly when your current obligations end and when new ones begin, down to the month. Here's what shocked a friend when I reviewed their liquor store lease: one word changed their operating cost share from 10% to 33% when an anchor tenant left. Downsizing has the same trap--your new HOA might look cheap at $200/month until you read the fine print about special assessments. In one shopping center we managed, costs swung wildly year-to-year based on snow removal contracts and landscaping bids. Your "smaller, cheaper" condo could hit you with a $10,000 roof assessment six months in. The money you free up is tempting to spend immediately, but I learned from managing our own company finances: keep 18-24 months of the difference liquid before making any moves with it. We saw operating expenses spike 40% one year when HVAC systems died right after acquisition. Your downsized home will have its own surprises, and that freed-up equity needs to cover them before you think about investing it elsewhere.
In my experience, people often choose to downsize for two main reasons: freedom and focus. For some, it's about financial relief, reducing mortgage costs, taxes, and maintenance so they can allocate resources to travel, family, or investments. For others, it's about simplifying their lifestyle. They want to spend less time managing space and more time enjoying what matters. What shows is a common desire to gain more control over their time and money. That said, downsizing isn't just a logistical move, but a change in mindset. The emotional part tends to be the hardest: letting go of possessions tied to memories or adapting to a smaller space that feels unfamiliar. Financially, people sometimes underestimate hidden costs like storage, moving, or renovations to make a smaller place functional. My best advice is to start early and be intentional. Don't rush the process or treat it as just a move. Treat it as a transition to a new chapter. Think about what you genuinely need, not just what you've grown used to having. When done thoughtfully, downsizing can feel less like giving up space and more like gaining clarity and flexibility in how you live.
I've spent 23+ years in real estate and construction, and I've walked dozens of clients through downsizing--here's what the financial planners won't tell you because they don't see the property side. **Transaction timing can cost you six figures.** I had an investor client sell their 4-bed in Palm Beach during summer when inventory spiked--left $80K on the table compared to selling 90 days earlier in peak season. Then they bought the downsize condo in fall when demand was high. That timing mismatch alone ate up almost all their equity gain. List your larger home in Q1 (Jan-March in Florida), close in 60-75 days, then hunt for your downsize during the slower summer months when sellers are motivated--you'll capture both sides of the seasonal arbitrage. **Capital gains exemptions require strategic use of freed-up cash.** If your profit exceeds the $250K/$500K exemption, don't just park that excess in a savings account. I've helped clients immediately reinvest a portion into qualifying home improvements on the new property within the same tax year--solar installations we do at Gomez Roofing can run $15K-$35K and qualify for the 30% federal tax credit while also reducing your cost basis if you sell again later. One couple downsized with $620K profit, immediately funded a $28K solar system and a new roof, cutting their taxable gain while slashing future utility bills by 70%. **The real killer is underestimating your new cost-per-square-foot.** Smaller doesn't always mean cheaper--I've seen retirees downsize from a 2,800 sq ft house to a 1,400 sq ft luxury condo and their monthly carrying costs actually *increased* because of HOA fees ($850/month), higher property taxes per square foot in dense areas, and special assessments. Run a true monthly cost comparison including insurance, utilities, fees, and maintenance reserves before you commit--in South Florida, a smaller waterfront property often costs more to maintain than a larger inland home.
I've worked with hundreds of families through downsizing over my 20+ years as a financial advisor, and the biggest mistake I see is treating the equity windfall like found money instead of repositioned capital. When clients pocket $300K-500K from downsizing, my first move is calculating their true cost-per-square-foot of their current lifestyle--not just mortgage, but the hidden stuff like lawn service, HVAC maintenance on a 3,500 sq ft home, property taxes that'll keep climbing. Here's what actually moves the needle: take that equity and immediately split it into three buckets before you touch a dime. I had a client couple in their early 60s downsize from a 4-bedroom in Orange County to a 2-bedroom condo, freed up $485K. We put $200K into tax-advantaged accounts they couldn't access easily (removed temptation), $185K into a dividend-focused brokerage account generating $650/month to cover their new HOA fees plus extras, and kept $100K liquid for the "oh crap" fund. Five years later, that dividend account alone has grown to $240K while paying them monthly income--they basically got paid to downsize. The tax trap nobody warns you about: if you've lived in your home less than 2 of the last 5 years, you lose the $250K/$500K capital gains exclusion. I've seen people forced to downsize due to health issues at the 18-month mark, and that timing cost them $75K in unnecessary taxes. If you're even thinking about downsizing, talk to a CPA about your timeline before you list the property. One more thing from my ModernMom work--if you have adult kids who might boomerang back or aging parents who might need to move in, don't downsize too aggressively. I wrote about this recently with young college grads struggling to launch. That extra bedroom might feel like wasted space until your 24-year-old needs it for six months, and suddenly you're either cramped or watching your kid pay $1,800/month in rent when you have equity sitting there.
I'm a CPA with 15+ years handling business financial strategy, and I've guided clients through major liquidity events--downsizing is fundamentally the same challenge: what to do with a sudden cash influx. **The biggest mistake is ignoring the entity structure question when you receive the windfall.** I had a client who downsized and freed up $340K, then immediately dumped it into personal investments without considering whether forming an LLC to hold rental properties or dividend-generating assets would shield them from liability and create better tax treatment. We restructured six months later--cost them $8K in legal fees they could have avoided. If you're planning to deploy that capital into income-generating assets, talk to your CPA about entity selection *before* the sale closes, not after. **Cash flow modeling beats lump-sum thinking every time.** I build financial models for businesses raising seed rounds, and the same discipline applies here--I tell downsizers to project their monthly cash needs for the next 10 years, then ladder the freed-up capital into CDs, Treasury bonds, or dividend stocks that mature when you'll actually need the money. One couple I worked with had $280K from downsizing sitting in a 0.5% savings account for two years while inflation ate 8% annually--we laddered it into 1-year to 5-year CDs at 4.5-5.2% and immediately improved their real return by $11K+ annually. **The hidden cost no one discusses is the loss of your old home's depreciation and cost basis history.** If you've been itemizing home office deductions or running a small business from your property, downsizing resets that entire tax picture. I've seen clients lose $15K-$22K in annual deductions because their new condo doesn't accommodate a legitimate home office setup--calculate what you're giving up in ongoing tax benefits, not just the one-time capital gains.