The first most important investment is buying your own home. Don’t live in rental properties. In my whole life, I have never rented a place to live. When you are living in your own home, you will always feel more secure.

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Think of it as if you are renting. Instead of paying rent now you are paying a mortgage. Sometimes, mortgage payments can be more than what you would normally pay as rental. But then again, when you are paying interest and mortgage, you are also paying capital back, which is like savings. Plus rents go up every year but your mortgage payments will stay the same so in few years you will be paying less then rental payments.

Remember, the first most important thing is that you have to have a roof over your head which belongs to you. What it means is that you have to buy your own home as soon as possible or you will never be able to buy a new house as prices of the houses will go so high that it will be difficult to buy a house. If you have a habit of spending money on small things, you will never be able to save money to put a down payment on your home and buy your own home. Any couple who develops a habit of not spending on small things should be able to put a down payment for their house and will be financially secure in 5 to 10 years, if not rich.

I know a lot of people who have bought homes in New York, Los Angeles, or other big cities. After 20 years, they sold their homes and moved to cheaper states like North Carolina or Florida and bought another home at 1/3 of the cost and lived with the profits which they made by selling their city house.

You can keep on paying rent or you can own the same house in 15 years and don’t have to pay rent after 15 years, and all the mortgage interest that you paid actually was a rent you paid to yourself and after 15 years, your home becomes free and clear and whatever the value of that house is, that is your equity to keep.

Real estate is the biggest money making machine, ever

By investing in real estate you can have a continuous flow of rental incomes.

Return on your money year after year: If you buy a house for $60000.00 and you put a 10% down payment which is $6000.00 You borrowed $54000.00 amortized over 15 years at 6% interest which is equal to $3200 per year a year it may cost you $1800taxes,$700 insurance,$900 maintenance and counting 5% vacancy $800 with a total expenses of $7400 per year. If you rent this house for $800 a month or $9600 a year it will give you a net reurn of $2200 per year on $6000 investment. This is close to 32% return on $6000 of down payment. As over a period of time rents will increase and if the etc money what is made every year is put back to pay off mortgage then property will be free and clear in 15 years.

By Ashok of http://becomerichinfiveyears.blogspot.com



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