Buying a home is a big investment, no question. Whether you are buying your first home, your forever home, your investment home or your retirement home, you have worked hard for the money it will take to make this happen. So how do you know when to tap into other financial resources? How do you know when to push the funds just a little more? Should you tap into your long-term savings? What repercussions will you experience if you cash out an IRA? Consider these few points before breaking open your proverbial piggy bank!
Is this a forever home or a ‘sort of fits for now’ home? Consider whether or not you will outgrow the spaces within the year. Is the area going to work for you or do you already dread the commute? Will tapping into your long-term savings deplete the cash you need to paint and carpet or do other things the home may need? Is the space, area, setting, condition so perfect that it fits more than you dreamed you could purchase? If you look at the home and feel ‘it will do for now’ perhaps that is not a motivating reason to deplete your extra savings.
Do you feel well-educated about where and what you are buying? If you expanded your home search to be another mile South or East, for example, would you be able to afford everything you are looking for without over extending your finances?
Finally, will you still have what we call “Friday Night Money” i.e. that money you need for the little extras. That can be anything from a fun evening in a nearby restaurant to money for a simple garden hose. This is money you won’t have If you tap into every extra resource to buy your home. Again, only you know what is right for you, and where your financial limits are. Still not sure? Don’t hesitate to give us a call!