We recently made the biggest purchase of our lives. We went out and bought our first house in Seattle, WA. Sure, we did it a bit haste but we got an incredible job opportunity in the area and the rent market flat out sucks. That is why we decided it was time. Yes, risky as we have never lived in Seattle. We traveled to look at the area and scope things out but you don't really get to know an area without living in it. Fortunately, Google has made research and information easily available to make the purchase less risky. It also allowed us to buy smart by looking at median house prices in the area, crime rates, school ratings, likelihood of appreciation, and even a walk through the streets in the area using Google Maps!
The biggest question friends in my age group have asked though: How in the world can you afford a house when everyone in our high school class is just worried about getting an apartment or breaking up, etc.? Here are my answers:
1. Marrying Young. I am not endorsing marriage young because it isn't for everyone. As a matter of fact, most people at 19 I will not recommend getting married. But after 6 months of counseling, a lot of talk, and a lot of time spent thinking about it, we knew it was time. There comes a time in every relationship (some times that 'time' comes later) that you know that marriage is the next step. But you have to be serious as marriage is the single biggest commitment you will make in your life. Most 19 year olds are not at that level. The fact that we took our marriage seriously has made our marriage rewarding. It doesn't matter if you lose your job, your house, or money. Your marriage is the single most important commitment. If you do that, I guarantee you can surpass losing your job, house, or money.
2. Paying Off Debt Early: Less than 2 years out of college, I paid off my student loans. How you may ask? Anything I had extra went to that. Birthday money - college loan payment. Bonus - college loan payment. Extra money from paychecks - college loan payment. Get the cycle? I had to borrow $25,000 so I am not talking a small amount (sure it was less than some but not easy). I even paid off my loans while still in college working two jobs! Getting married in college also alleviated college financial woes as we got so much grants for being married. And by paying off loans, my credit score increased!!!
3. Military. VA Loans rock. No down payment, lower interest rates... We have some strict guidelines on things because it is a government funded loan but not as much as you would think. We did put money down but not enough to be charged PMI (Private Mortgage Insurance) which is waved by a VA Loan! Again, VA Loans rock. End of story.
4. Saving. We have always put money away. We have a budget and we stick to it. The day we get paid, I pay all bills and put money away. What we have leftover is our budget for fun. But fun couldn't come until everything else was put away and we had savings for a rainy day. I'm not saying you have to put away a lot as even $100 adds up. If you can put more one month and not so much the next, do it. If your company has a 401k plan, also use it because retirement is also important.
5. Investments. Cisco had a great program for employees. You could buy stock at less than market value. We used that and got so much money!
6. Good Jobs Out of College. We were lucky enough to be hired on at great jobs. We made a decent amount and did well that bonuses and everything added up.
This is my list of how we were able to afford a house now. Also - remember to not compare yourself to others because your track is just as beautiful and awesome. Just because you can't right now doesn't make you anything less. You are being smart for your situation and everybody's life path is different. Do what makes you happy and is the smartest for you, not because everyone is doing it or its the status appeal.
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