It’s Kind to be Financially Stable
In terms of both lifestyle and monetary stability, buying a home provides a new sense of reliability to first-time homeowners. In some cases, mortgage payments paid monthly may be less expensive than some rental rates (Hello, savings!). June is National Homeownership Month, and while there’s so much to celebrate about being a homeowner, the pathway to financial stability is one of the biggest advantages. Here are three ways homeownership leads to financial stability.
Homeownership Builds Equity
Are you ready to build equity while backstroking through your Benjamins? Or perhaps you picture yourself as Scrooge McDuck diving into a vault filled with gold coins. Either way, most financial advisors will attest that real estate and homeownership are the pathway to long-term wealth. Now while we can’t guarantee you’ll be McDuck, owning a home offers the opportunity to build equity. Simply put, the equity is the value of your home minus the amount owed for it.
In most situations, you’ll be simultaneously paying down your home loan while it accrues value. The equity built over time is yours to use in case of change to your financial status, to build generational wealth, or even to assist in financing additional properties.
Homeownership Inflation-Proofs Your Payments
Not feeling so grande after seeing your coffeeshop total? The effects of inflation can be seen in your coffee purchases and your car fill-ups. Rent is likewise affected by inflation. If knowing your biggest monthly expense is at risk of going up, up, up, then it’s time to consider homeownership. With regular and known payments made through the life of your loan thanks to fixed interest rates, you’re guaranteed a known payment.
Plus, rent in many markets is comparable to mortgage payments. When you consider that rent does not add value to your financial wellbeing, the fluctuating costs may just not be worth it.
Homeownership Allows You to Tap into Your Wealth
There may be times in life where you need to say, “Show me the money.” As a homeowner who’s building equity in your property, you have the option to tap into that accrued wealth to further your financial goals. For example, upgrade your home and further its value by pulling some of the equity out of your property to finance the renovations or additions. A cost-savings scenario is to use the equity to pay off additional debts at a higher interest rate. If you’re ready to downsize, the equity you’ve built plus the reduced cost of your new home can result in a very comfortable retirement.
Homeownership increases your financial stability thanks to equity accrual, set payments, and the flexibility to pull from your wealth as needed. The home buying process should feel just as stable. When you work with a Kind Ambassador, you’re partnering with an experienced professional with access to a variety of loan programs designed to suit your unique needs and financial goals. Find your local Kind Lending loan officer by visiting Kind Lending.