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Did you know?
From 2001 to 2005, the average homeowner saw the value of his or her house jump by more than 50 percent.
We all have our guilty pleasures. I love buying cheap, useless junk from eBay and getting used books from thrift stores. Some people love going shopping for clothes when their closets are full. Others waste hundreds of dollars a year on power ups for iPhone games. And it’s okay to treat yourself- it’s your money, and you should spend it how you like. However, it’s never useful to just pour your hard-earned cash down the drain. The $150 you spend on eBay this year could have been used to buy a plane ticket. That shopping spree could have been a payment on a brand new car. There are usually way better investments for you money. For a list of things to just stop buying, check out this post by Jacob at I Heart Budgets:
-Credit card interest- buying something on credit if you NEED to (like hospital bills or auto emergencies), or for getting rewards like cash back or airline miles is fine. However, without having the money to back it up, you soon can find yourself thousands of dollars in debt, and waste money by paying the interest.
-Appetizers at restaurants- they cost as much as an entree, and the entree portions are usually huge enough where you don’t need the extra food.
-Overdraft fees and ATM fees- budget your money and plan ahead.
If you are just now beginning your journey to buy a home, you probably have a lot of questions. You’ve probably heard terms like “adjustable rate,” “debt to income ratio,” “FHA loans,” and others- but you don’t really have any idea what they mean. If you know absolutely nothing about getting a mortgage, let alone the different types, then you need to read this guide by Elizabeth Bennett Colegrove at the Reluctant Landlord. It’s an easy to read post that outlines exactly what you will need to get a mortgage, as well as different types of loans you may qualify for. Check it out:
First time home buyer
Only 3.5% down payment
First time home buyer
Available in underprivileged and low income areas
Strict appraisal guidelines
When shopping for a mortgage, it’s important to follow the right path. Don’t get suckered in by promises of zero down payment, temporarily low interest rates, and no credit checks. Programs like this certainly exist, but will usually end up taking advantage of the buyer. You might save some money now, but you will end up paying through the nose in the long run. Read this article by Mark Riddix at Yahoo Real Estate for more mortgage mistakes to avoid:
-Adjustable Rate Mortgages- offer low interest rates up front, then raises them after a few years. It works, but only if the housing market is in full swing. If your home doesn’t build you any equity, it can quickly become a nightmare.
-No Down Payment- borrowers who make a down payment are more likely to make sure they don’t lose their investment.
-Liar Loans- these are loans that require little to no documentation
-Reverse Mortgages- there are high upfront costs, and the owner loses ownership of their home.
We all have those things that we know we don’t -need-, but that we keep mindlessly buying anyway. This week, I decided that I’m done with soda. I won’t drink it if it’s not in the house, and I’ll become healthier (and save more money) by drinking water instead. There are tons of things in my house like that. For a list of things you don’t actually need to buy, check out this post by Stacy at Six Dollar Family:
Cooking herbs- grow your own, sustainable, fresh herbs.
Lotion- I tried my own homemade dry skin repair cream and I haven’t looked back since.
Body Wash- try making homemade body wash
Pasta Sauce- I now make our own homemade pasta sauce saving myself an average of $2.00 per jar.
Dishwasher detergent- I started making my own homemade liquid dishwasher detergent.
Everything you do today affects you in the future. If you exercise and eat healthy now, in the future you will probably have less medical problems. If you save your money and don’t buy that impulse purchase today, you can use that money for a vacation later. In fact, it’s especially true in the world of finance. Smart saving and frugal spending now will pay off big later! However, mistakes you make now can still do damage to future-you. Check out this post by Haniya Rae at Bustle. These are things that can prevent you from getting a mortgage later:
-Not saving for a down payment
-Having a bad credit score and doing nothing to improve it- pay those bills on time!
-Not having a credit score at all
-Having too much debt
-Not getting pre-approved
-Not working at the same place long enough- 2 years!
Being in your 20s and getting out on your own will probably be the most challenging financial time in your life. You suddenly have to pay for rent, a car, tuition, insurance, and utilities, all while having no work experience and starting from the bottom. So, how do you go about spending your limited income? What are the best financial decisions you can make? What can you do now that will help you for the rest of your life? Check out this article by Mike Ouyang at the Lending Tree Blog for the best things that 20-somethings can buy:
-A college degree, or trade school education- those with a college degree are more likely to be employed than those with just a high school diploma, and have statistically higher paying jobs.
-Books- read anything and everything that catches your interest, it helps your cognitive skills, communication, and keeps you up to date with the world around you
-Stock and portfolio investments- diversify your options to minimize your risks
-A gym membership
-Paying off debt as fast as you can- get that credit score up, free up your finances so you can put them in other investments, like a savings, investment, or retirement account.
A mortgage is probably the most complicated loan you will ever apply for. There are lots of steps- from getting pre-approved to closing, and everything in between. If you are totally new to the home buying process, this helpful infographic by Anita Clark at Warner Robins Realty will definitely shed some light on the steps to getting a mortgage:
-Get pre-qualified- the lender will determine how much house you can afford
-Get pre-approved- the lender will state the maximum amount they can give you
-Choose the type of loan, lock in rate
-Lender verifies all paperwork/info
-Closing- title of home is transferred to buyer
Sure, you can always throw your own yard sale, get rid of some unwanted junk, and collect some cash. However, if you are crafty and have a good eye, you can also make money from OTHER people’s yard sales! Check out this post by Chrystie V. at the GSALR Blog for tips on how to flip your yard sale finds for profit:
-Use eBay to sell vintage items, antiques, children’s clothing, and collectibles
-Craigslist is great for larger items, like furniture, outdoor toys, and electronics.
-Upcycle it- with some elbow grease, sandpaper, and paint, an old piece can have a new life, and be sold for profit!
-Sell vintage items on Etsy
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