Rent Vs Mortgage

Over the past 20 years Canadians have decided that owning a home is a great financial investment.  While owning a home has many advantages, there are also many reasons you may not want to own a home.  The following is a short list of some of the main reasons for and against owning a home:

Pros -

• Sense of ownership
• Build equity in an asset rather than paying it all to someone else
• A house usually grows in value at, or above, the inflation rate
• Privacy
• Freedom to do what you want with the house for decorating and renovations
• Financial security for retirement

72 Hour Emergency Kits Are Important

This is a repost of an article I wrote back in Nov of 2009.  I thought that with the recent evacuations around Alberta and the Rocky area that it was worth posting again.

Are you prepared for an emergency?  There are some areas of the world where they have become accustomed to evacuating their homes at a moments notice.  Hurricanes, tornadoes, and forest fires are just some of the natural disasters that affect people’s lives annually.  As a result, people who live in areas plagued by these events have 72 hour kits that allow them to leave home quickly, and be prepared to live away from home for at least 3 days.  Many have suitcases packed to help them live for up to a week without access to their home.

The basics around a 72 hour emergency kit are:
1. Know the risks
2. Make a plan
3. Get a Kit

Costs of a Home

A couple of weeks ago I spoke with a 23 year old, single young man who has been living with his parents for the past 18 months.  He was talking about saving up money for a down payment on a home.  He already has a pretty good idea about what mortgage payment he can afford.  He is buying a small house, with the hope of moving into a larger one in several years.

I threw him for a loop, though, when I asked him about property taxes and maintenance costs.  He had not thought about those costs.  He figured property taxes would be about $400, but when I told him to expect property taxes to be around $2,000 or more his jaw almost hit the floor.  He had no idea the taxes would be that high. 

There are always added costs to owning a home.  Here are a few I could think of:
Property Taxes - these always seem to be more than you thought, and they tend to increase pretty much every year, sometimes by several percent.  It often means having to put away $150 to $300 away each month to pay for them, a cost that can really add up.

Rates Are Going To Rise

Rates have been at historic lows for about 2 years in Canada, and about 3 years in the United States.  As the international and national economies improve, interest rates really have nowhere to go but up, and that is going to impact you.

There are 2 groups of consumers who will be most concerned with increasing rates: Investors/Savers and borrowers.  The first wants rates to increase, the latter does not.