Morning! today I have a guest post from Kevin Watts who blogs over at Graduating from debt, enjoy! Let me know if you would like to guest post on RFI.
The house, the white picket fence and a couple of kids running in the yard, starts every “American Dream”. Something that we can be proud of that has been achieved through all our hard work. But there are things to consider before achieving your own “American Dream”. But owning a property is not without its benefits.
We spend a lot of our lives saving money and living with-in our means, but we never questions our selves as to why we do this. The main two factors include freedom and security. You want to build a nest egg and security investment for your precious family, and rightly so. You want to make sure that if anything unforeseen happens you have funds available to accommodate them.
Once we have made sure we feel human instinctively secure we work on freedom. The power to unlock what you and your family need and want on demand, and to live your life the way you choose.
So how does taking out a massive mortgage help?
With security and freedom over shadowing our financial goals, how does taking out a mortgage help build your dreams? The fact of the matter it does not help you feel more secure, if anything it helps you feel less secure because of the outgoing payments each month. But this is not something to be put off by. The waiting for the fruit to ripen is worth the reward. In years to come when you own your home out-right you will see a massive return on your investment and all the years of feeling a little less secure will be worth it. So long as you keep up with your repayments you have nothing to worry about, apart from the up-keep of the property.
What finances should you consider before buying?
There are several things that you should think about before purchasing property. These are just a few of the main ones.
- WHEN THINGS GO WRONG. It does not matter what age or financial state you are in, you need to plan for unexpected occurrences. There is no amount the can be said you need as a minimum or maximum; this is because everybody’s emergencies will be unique to all others. You need to make sure though you have enough to pay at least one months payment for the property to make sure if something does happen you have a bit of breathing time to plan you next move.
- LIFE DEATH AND ILLNESS. Insurance is the best you can have to help you feel more secure and safe. You should consider for all of you family life, illness, death and property insurance. With this you can sleep easier knowing that if something does go wrong you are covered.
- RETIREMENT. You also need to consider retirement, even if you think that is years away there is no time like the present to plan. You need to plan to save; you need to consider how much you will need to live on when you retire and for how long. Paying into a pension plan would be advisable.