Money – A Barrier Not Freedom

Millennials, this is for you.  Just starting college?  Finishing college?  Started your brand new career?  Can’t find a position in your field so you’re still bar tending?  But, not just millennials, EVERYONE.  Money has become a barrier.  It holds us down, keeps us back.  With our estimated national debt being at 19.3 TRILLION freaking dollars, no wonder Americans now more than ever cannot figure out how to handle their money.  It’s literally thrown at us, all bundled up nicely in a credit card, or a student loan.  Hey, here is a huge ton of money you can have for free!* (*but it’s not really free, if you don’t pay it off now it’ll haunt your dreams, invade your sanity and follow you around forever).  Taste the sarcasm there.  Kind of.  How many of you are living paycheck to paycheck?  Truthfully?  Sites like GoFundMe.com and YouCaring.com have exploded enabling us to mismanage our own finances even more.

Now more than ever we are in a crisis. We are spending $5 on coffee, on a credit card, with an interest rate, which could end up being a $30 or $40 or even $100 cup of coffee.  We are carrying student loan debt, credit card debt, car loan debt, mortgage debt, ect ect and still spending and spending.  As I got into the real estate industry, and had to talk to people about their financial situation, it became more and more clear to me.  We have no clue what we are doing with money.  It makes the world go around, so much so, we can’t get a grip on it.  Have you heard of Gaby Dunn‘s Bad with Money?  Check it out.  It’s eye opening!

Here are some of the concerns I have come across in talking to people about home ownership.

  • I don’t have anything saved for a down payment.
  • I don’t have a plan (money) if we buy and something expensive breaks down (roof, HVAC).
  • I’m worried I won’t be able to make the monthly payments.
  • I’m not ready to make that kind of commitment

All of these have to do with managing money, even the last one.  If you know how to budget then you can save for a down payment.  If you know how to budget and stick with it, you can have a plan for expensive emergencies.  If you know how to manage your finances you can be confident you can make the monthly payments.  It is said, landlords grow rich in their sleep.  Mind you, owning isn’t for everyone.  And that is okay.  But think about it… The average home for rent in Montgomery County is approx $2,500.  In Frederick County it’s $1,800. That’s $21,600-30,000 per year that isn’t accruing any equity for you.  If you can afford that in rent, then you can probably afford to own.

What’s the first step?  Talk to a financial planner.  These are different than a financial adviser.  They don’t tell you where to invest your money (at least from the start), they help you with your monthly budget, how to plan for emergencies, track where your money is going ect.  Don’t think you can afford one?  You CAN’T afford not to have one.  It’s tough getting down and dirty with your finances. But it’s necessary.  Listen to Gaby Dunn’s second podcast episode and do the math for your retirement.  It’s scary stuff if you have no plan and are never going to be in a Michael Bay movie.  I’ve included some links for financial planning below (these are not affiliate links.  I don’t get reimbursement for clicks or referrals, I just know they are legit and can help you).  It can’t hurt to reach out.  If you ever have any questions, I am always happy to help!  My next post will be about you who do own right now, so stay tuned.  As always, please like, share, comment ect.  I’d like to know what you want to hear about and what is important to you!  Maybe just maybe, I’ll even podcast myself.

 


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