Are your kids (or yourself) renting a home ?
Are Your Kids Renting?
Or do they own their home? If the answer is renting, here’s a few facts that may convince you that ownership is better.
The average homeowner in this country is 38 times wealthier than the average renter. If you don’t own your home, your chances of accumulating wealth are slim to none. Let’s look in depth at this.
Let’s say you spend $1500 per month on rent over a long period of time. That’s $18,000 per year. And what do you have at the end of the year? A stack of canceled checks. Let’s extrapolate this over 30 years. That $18,000 per year turns into $540,000 over a 30 year period. If you spend that money on rent, what do you have at the end of those 30 years? You have nothing. You are right where you started – owning nothing. But if you were to spend the same amount on paying down a mortgage, at the end of 30 years you could end up owning an asset worth a lot of money, and you would no longer be paying rent or a mortgage.
Purchase a Home
It’s been said that the biggest financial mistake young adults can make is to not purchase a home.
If your children have not bought a home yet, and are renting, please urge them to buy a home. Today is a good day to do it, yesterday would’ve been better. And if you are the one renting, the same applies to you. Are your kids renting?
We hear all of the time that they haven’t been able to save enough for the down payment. Are they veterans? If yes, they may qualify for a mortgage with no cash down. And they may be able to get the seller to pay their closing costs. And if they’re not veterans, an FHA loan only requires 3.5% down. On a $300,000 house that’s only $10,500. In addition, the seller may pay the closing costs.
So – what are they waiting for?
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Will you be buying and/or selling a home? Contact us.
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