I have a theory. Not a dream, but a theory. And it goes like this: All of us who aren't independently wealthy are being bilked. We're feeding the money-making machine without getting any part of the pay-out. And here's how it's happening, or at least one particular example....
Buying into the belief that we need to buy a starter house, then a home to raise our children in, but it's not the house we'll own forever. Because truly, who (besides the Amish) owns a house forever anymore? We're not tied to the land we live on anymore the way our agrarian ancestors were. We allow job transfers to uproot us from family and friends all the time, and so this idea that we need to own the house we're living in is outdated. But.. but... the equity, the money "wasted" on rent, it's a financial investment, my children. Really?
A quick google search showed that in Australia, average home ownership is 10 years; and in the US it's 8 years. That's not a good long-term investment. That's a minimal amount of equity when you sell that you're getting back (if the market hasn't tanked). That's not all of childhood. The only one making money on the buying and selling of homes before the mortgage is paid off is the banks! The interest they are collecting and the closing costs are making all of them uber-rich and all we are doing is making payments, making payments, making payments.
Set aside your beliefs, what society is telling you, and just think about it for a minute. Unless you're in a position to pay cash for your house, you're taking out a mortgage, a loan. Loans cost money called interest, which usually, by the time the loan is paid off, will have doubled what you paid for your house. Plus, there are closing costs, inspections - all these fees that go to the bank and others. We are keeping the wheel well-oiled, but not to our benefit. We can change the game by not playing.
I propose that we opt out. Instead of believing we need to buy that starter home, then the family home, and then the retirement home (a typical scenario given that there isn't a job change or transfer or two in the middle adding more home-buying/selling); we rent. Rent and save. Save and rent.
For all the years we are coming of age and then need extra space for raising children, just rent. Once the children are launched, then, go and buy the "forever" home (whatever that means). Buy a house that is the appropriate size for you to live the rest of your life in. Buy the retirement home. Think of the money you will have saved by NOT buying, and paying interest on, a 4-bedroom, 2 bath, 2000 sf house on 5 acres. But, but, but.... I know. There is a long list of buts. But I don't buy them.
I don't believe my family has to be tied to the bank in order to have a home.
I don't believe my family has to be in debt to have freedom.
I don't believe my family has to have a large house so we all have personal space.
I don't believe my family will be happier with more stuff.
I don't believe my family has an obligation to keep the banking industry in the black.
What I do believe in is experiences, freedom from debt, living within our means, and stepping outside society's norms.
It's time to start questioning the lifestyle being sold to us and being intentional with our living. Make the choices that fit our values rather than just going with the flow.
What do you think? Have you ever questioned this particular norm and found an alternative way to go? I'd love to hear your thoughts in the comments.
Thanks for reading and I'll see ya soon.
Ann
Please share this post and keep the conversation going.
Thanks!
Buying into the belief that we need to buy a starter house, then a home to raise our children in, but it's not the house we'll own forever. Because truly, who (besides the Amish) owns a house forever anymore? We're not tied to the land we live on anymore the way our agrarian ancestors were. We allow job transfers to uproot us from family and friends all the time, and so this idea that we need to own the house we're living in is outdated.
A quick google search showed that in Australia, average home ownership is 10 years; and in the US it's 8 years. That's not a good long-term investment. That's a minimal amount of equity when you sell that you're getting back (if the market hasn't tanked). That's not all of childhood. The only one making money on the buying and selling of homes before the mortgage is paid off is the banks! The interest they are collecting and the closing costs are making all of them uber-rich and all we are doing is making payments, making payments, making payments.
Set aside your beliefs, what society is telling you, and just think about it for a minute. Unless you're in a position to pay cash for your house, you're taking out a mortgage, a loan. Loans cost money called interest, which usually, by the time the loan is paid off, will have doubled what you paid for your house. Plus, there are closing costs, inspections - all these fees that go to the bank and others. We are keeping the wheel well-oiled, but not to our benefit. We can change the game by not playing.
I propose that we opt out. Instead of believing we need to buy that starter home, then the family home, and then the retirement home (a typical scenario given that there isn't a job change or transfer or two in the middle adding more home-buying/selling); we rent. Rent and save. Save and rent.
For all the years we are coming of age and then need extra space for raising children, just rent. Once the children are launched, then, go and buy the "forever" home (whatever that means). Buy a house that is the appropriate size for you to live the rest of your life in. Buy the retirement home. Think of the money you will have saved by NOT buying, and paying interest on, a 4-bedroom, 2 bath, 2000 sf house on 5 acres. But, but, but.... I know. There is a long list of buts. But I don't buy them.
I don't believe my family has to be tied to the bank in order to have a home.
I don't believe my family has to be in debt to have freedom.
I don't believe my family has to have a large house so we all have personal space.
I don't believe my family will be happier with more stuff.
I don't believe my family has an obligation to keep the banking industry in the black.
What I do believe in is experiences, freedom from debt, living within our means, and stepping outside society's norms.
It's time to start questioning the lifestyle being sold to us and being intentional with our living. Make the choices that fit our values rather than just going with the flow.
What do you think? Have you ever questioned this particular norm and found an alternative way to go? I'd love to hear your thoughts in the comments.
Thanks for reading and I'll see ya soon.
Ann
Please share this post and keep the conversation going.
Thanks!
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