Tuesday, July 10, 2012

Home Buying: Philosophies and Simplifying your Budget

I've had this post rattling around in my head for weeks. As many of you know, we bought a house. We started looking in February, right around the time I was posting about Finance month. It became perfectly clear when I started looking at our budget that we would SAVE money if we moved.

I know, it makes no sense at first blush. But here are the big ticket items that made me do a double take - both our rent and child care could go down substantially if we made some new decisions. Our mortgage is now about $400 a month less than our rent was. And child care ... are you sitting down? We found a great home / family day care center and when Zoom goes full time, we will have a savings of $600 a month.

Since we're a one income family right now, this is big for us. A little effort up front to move, for sure, but a lot of pay off on the flip side.

simplify red

The other item that really struck me as we started talking with real estate agents was their take the philosophy of buying a home. One agent (who we subsequently fired) had the distinct attitude that we needed to buy a home who's price stretched us to the point that we "thought we might barf or would make us worry that the baby would have to eat McDonald's every day." She was very much about getting a home that was a little bit bigger than what we needed, so we could "grow" in to it.

From the get go, I didn't jive with this person. The reasons were many; in this economy (and with an uncertain future for the stability of home prices) I feel it's important to buy as much home as I can afford. Afford right now. Not a stretch, not something that makes me want to be ill, but something that fits us.

I think each of us needs to be realistic when we look at finances. It's clear to me that the trend of pushing ourselves beyond the brink of comfort, with the expectation / anticipation that bigger salaries and ever rising home prices will fill the gap is reckless. Yes, reckless.

I'm not getting all gloom and doom here, I just feel that the recession has given me a wake up call. Buy what you can afford, live within your means. It's the reverse of the greedy 1980s mindset that taught us that "grabbing hands grab all they can, everything counts in large amounts."

My hope is that simplicity is about to become what extravagance was in decades past. That thrifting, making do with what you have, that taking care of our possessions and driving a car for 20 years becomes a mark of the new norm. If it does, I'm ready for it :) Who else is in?

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