Owning real estate is an excellent investment strategy with a holding that produces returns equal to the stock market but with less volatility.
Additionally, residential real estate offers investors unique tax advantages and can employ leverage to increase overall returns to them.
In this post, we will give you the best real estate investing strategies you can use to get started.
Before anything else, you have to know that your goals and timeframe will determine which investment strategies in real estate work best for you.
And here are your options:
Real estate investors buy and hold SFR properties to earn rental income, profit from property value appreciation, and take advantage of specific tax incentives. Single-family rental property is the most popular real estate investment type for novice and experienced investors. SFRs (Single Family Residential) are simple to locate, acquire, and run.
Residential real estate buyers have access to various financing choices, including conventional loans, loans backed by the government, private lenders, and lenders with portfolios of properties.
Reinvesting income from rental properties is a common supplement to the buy-and-hold approach many real estate investors employ.
The "snowball effect" saves net cash flow on one rental property until they have enough money for a second rental property down payment. Next, both rental properties' net cash flows are kept until they have enough money saved for the third asset.
The snowball effect of cash created by an investor's rental properties grows larger as the investor's portfolio grows, much like a snowball that rolls down a hill.
Owners may reinvest rental revenue by making extra mortgage payments to pay down a property faster. After appreciation and mortgage prepayments, the investor conducts a cash-out refinance to purchase another rental property.
Investing in rental property may demand a substantial down payment. People who own their home but don't have enough money to buy a rental property use house hacking.
The common examples of house hacking are the rental of a spare bedroom or converting a basement into a studio apartment. Savings from home hacking rentals can be utilized as down payments on rental properties until funds are available.
Some investors will also employ a low down payment Federal Housing Administration (FHA) or Veterans Affairs (VA) loan to buy a modest, multifamily property. The requirement that the borrower resides in one of the units as their principal residence is one of the potential disadvantages of this strategy.
However, residing next to tenants is an excellent opportunity to learn about investment strategies in real estate and obtain practical property management expertise.
Investors utilize buy, remodel, rent, refinance, repeat (BRRRR) to buy fixer-upper property with short-term financing, make renovations, rent to a qualifying tenant, then refinance and draw cash out once the property has stabilized cash flow.
In the BRRRR investment strategy in real estate, investors repeat the same steps, like the snowball effect. Active investors with the time, knowledge, or a trusted, cost-effective network of contractors and handypersons to remodel should use BRRRR.
If everything goes according to plan, house flipping is a high-risk real estate investing strategy with a potential high payout. Fix-and-flip investors don't want to be landlords since they only own properties for a few months. After buying an undervalued home, a flipper may perform targeted modifications to increase its value or hold onto it to profit from appreciation.
A home flipper who takes too long or underestimates repairs may run out of money. Fixed and flipping is best for people with knowledge of assessing fair market property worth, remodeling costs, and enough funds to finish on schedule and budget.
These are just some strategies in real estate investment. If you find this helpful, we've created more tips on how to invest in properties in Part 2!
Buying your first home is an important decision, and it can be an overwhelming experience, particularly the closing process. But the question is, "What is the closing process?"
This post will give you an overview of what it's about and the necessary steps to complete it.
Closing is the last process before receiving the keys to your new house. This is a real estate transaction that involves the buyer and the seller and maybe, the participation of some other parties.
A settlement is the same as a closing, which means that any contractual responsibilities between a buyer and a seller are resolved at that point. This accounts for any remuneration owed to your real estate agent, title firm, or attorney.
Buying a home involves several steps and often takes thirty to sixty days until you are finally ready to close on it. This closing meeting could occur in your lender's office, insurance company, real estate agent, or title firm.
You will be required to read and sign several documents throughout the closing process, including the following:
Loan Documents
Closing documents refer to the papers that either the home buyer, home seller, or both parties involved in the sale of a home must sign for the deal to be finalized.
In most cases, the documents will provide the home buyer with information regarding the total amount of the closing fees while the seller will receive confirmation of the sale.
Purchase Agreement
The seller must sign the purchase agreement and then send it back to the real estate agent representing the buyer. This agreement details any conditions attached to the offer and the date that was settled upon for the transaction to be completed.
The seller must hold any "good faith" or a deposit the buyer offers in escrow until the transaction is completed. The deposit is released from escrow as soon as the mortgage paperwork is signed, and the buyer is free to utilize it however they see fit, generally using it toward the down payment or other expenditures associated with the closing.
Closing Disclosures include mortgage terms, interest rates, monthly mortgage estimates, and closing expenses.
Real estate law requires lenders to inform buyers of the Closing Disclosure three business days before closing. Buyers can analyze and comprehend mortgage costs during this time.
The loan estimate estimates homebuyer costs, but the Closing Disclosure is accurate. Buyers can also check their name spelling and loan duration on the Closing Disclosure. The lender will provide updated Closing Disclosures and reset the 3-business-day window when the buyer notifies them of the changes.
Conclusion
A team of escrow officers will work through each piece of paperwork with you step by step to ensure that you fully comprehend the terms and circumstances of your transaction.
We also provide a variety of technological options to simplify the closing process. These solutions include electronic signatures and remote online notarization, making it simpler than ever to complete your closing without leaving the convenience of your home.
The term "seasonality" refers to the recurring cycles and shifts characteristic of a given point in time throughout the year.
It is a crucial component that can dramatically affect the real estate market, and it is one of the many aspects that influence the real estate industry, just like it affects many other sectors.
Buyers, sellers, and real estate investors must understand how seasonality affects the market because it can affect pricing, demand, and total market activity.
In this post, we will look into seasonality in real estate market and how stakeholders can use this learning to make more informed decisions.
Pricing and seasonality in real estate market have a very close relationship. Prices of homes might be expected to move up and down following the marked seasonality of the region.
For instance, during spring and summer, when there is a boom in demand, sellers may choose to advertise their properties at higher prices to capitalize on the increased interest from buyers.
On the other hand, when business is slower in the fall and winter months, sellers may need to change their prices to attract possible purchasers. Buyers and sellers of real estate must be aware of the seasonal pricing trends and consult with agents with significant knowledge of the local market to make well-informed decisions.
Seasonality is a factor that can substantially impact the real estate market's level of demand, both positively and negatively. The spring and summer months saw increased demand in the past since potential homebuyers prefer to move during more agreeable weather conditions and before the new school year begins.
Consequently, there is a trend toward a rise in real estate inventory during this period, providing buyers with more options.
On the other hand, demand may decrease throughout the fall and winter months due to the approach of the holiday season and the possibility of severe weather.
As a consequence of this, there is a possibility that inventory will decrease, which will make this a more advantageous moment for sellers as there is a possibility that they will face less competition.
The rental market is also subject to seasonality, which affects both the demand for rentals and the available inventory. For example, because students move into college towns at the beginning of each school year, the need for rental housing there may reach its highest point.
On the other hand, demand can fall during the summer, when many students take time off for vacation or return to their hometowns.
Landlords have a responsibility to plan their rental strategies in a manner that is appropriate, taking into account seasonal fluctuations and the possibility of vacancies at specific times of the year.
It is essential to understand that the effect of seasonality in real estate market can drastically differ from one geographic region to another, which must be considered.
Spring may be the busiest shopping season in some parts of the country, but it may be falling in others, particularly those with milder climates. Compared to areas with more temperate temperatures, the seasonal slowdown in the real estate market may be more noticeable in areas with harsh winters.
Investors and other market participants must extensively study the region they are interested in to understand the seasonal patterns affecting the local real estate market.
Seasonality is critical to the real estate market. Buyers, sellers, and investors can benefit from seasonal demand, pricing, and inventory patterns. By understanding seasonality, stakeholders can better enter the market, set prices, and negotiate deals.
A knowledgeable real estate specialist with local market knowledge should advise you on any investment. With this information and expertise, market players can effectively analyze the real estate market and achieve their goals year-round.
First time buying a home in Indiana? Then look no further! In this post, we'll list down the programs and grants offered to homebuyers in Indiana.
Hoosier housing prices are considerably lower so if you haven't bought a home before, this might be good news. But wait, there's more! Indiana helps first-time homebuyers greatly. You may move into a new home sooner if you qualify for down payment assistance.
Below are some essential details on buying a home and the home-buying programs and grants they offer.
According to the Indiana Association For Realtors, Indiana's July 2023 median house sale price was $258,700. Over the past year, that price fell 3.8%. However, high housing prices can make down payment savings challenging.
Luckily, there are various financial assistance to choose from:
Loans for Indiana First-Time Home Buyers
At a 20% down payment, first-time homebuyers in Indiana can acquire a conventional loan with a low-interest rate and without PMI. Indeed, few first-time buyers are saving 20%.
Some low-down-payment mortgage programs allow borrowers to buy a property with 3% or even 0% down:
FHA, VA, and USDA loans need principal house purchases. Therefore, these loans cannot be used for vacation or investment properties. In most programs, you can use the given money or Down Payment Assistance (DPA) for your down payment and closing costs. Meanwhile, your mortgage loan may allow you to buy a house with little cash. Your lender might recommend a first mortgage program based on your finances and home purchase aspirations.
Indiana Home Buying Programs
The Indiana Housing and Community Development Authority (IHCDA) discounts FHA and conventional mortgages. Though specific target communities offer these, first-time homebuyers are the primary beneficiaries. As with state-run mortgage schemes, you must choose an IHCDA-approved lender. There are also income and housing price constraints. A 640 or 680 credit score is required if you have many debts.
Indiana Home Buyer Grants
Assuming you'll live in your new house for nine years, the IHCDA's down payment aid programs are better than many states.
These programs allow you to borrow 3.5% to 6% of the sale cost for:
Better, a DPA loan has no monthly dues or interest; your loans will be forgiven after nine years of home ownership without refinancing. Throughout those nine years, you must repay every cent borrowed if you sell, move, or refinance. Think about the long-term homeownership goals before signing up.
The IHCDA First Place Program
First-time homebuyers, homebuyers in target areas, and veterans who qualify can borrow up to 6% of their purchase price under the First Place Program. This help is a forgivable second mortgage for 30-year FHA mortgages.
The second home loan comes with zero interest and monthly payments. After nine years, if the buyer doesn’t sell or refinance, it’s forgiven. The First Place Program won’t work with the mortgage credit certificate.
Borrowers have to fulfill the following DTI and FICO score requirements:
The agency regulates single-family homes, condos, townhomes, planned unit complexes, and mobile homes. In addition, the buyer’s income must meet agency requirements. Remember that most eligible applicants have moderate to low incomes.
The IHCDA Next Home Program
Indiana Housing may help first-time and return homebuyers via Next Home. However, a 30-year FHA loan is necessary. Still, you can utilize the 3.5% purchase price for your down payment.
The down payment subsidy is forgiven after two years if you don’t sell or refinance. Aid and mortgage credit certificates can be combined.
Helping To Own (H2O)
The Helping To Own Program provides up to 3.5% of the FHA loan down payment; however, only Indiana first-time homebuyers qualify.
There are choices if IHCDA home buyer help did not work for you -- one is to ask your loan officer or two, a realtor for local down payment grants and loans.
All the organizations mentioned should offer free help to first-time homebuyers in Indiana or their localities. HUD offers statewide, regional, and local resource lists in addition to:
Have more questions? Send us an email or call us at 317-316-8224 today!
In the first part, we’ve discussed seven questions to ask when getting into real estate and provided some helpful answers to real estate questions. We will resume sharing the other real estate questions, so be ready.
Below are some additional real estate questions that might be helpful for first-time and repeat buyers who need a review of some essential details.
The national down payment average is 11%. That number comprises first-time and repeat consumers. The national down payment average is 11%, although first-time homebuyers often put down 3–5% because some first-time homebuyer programs don't demand large down payments.
Longtime popular FHA loans require 3.5% down. Additionally, some schemes allow family members to give down payments. Conventional loans needed 20% down for years. Repeat buyers used equity from their previous house as down payment monies for these loans. Some new conventional lending programs allow 3% down with private mortgage insurance.
If your present home's equity will go toward the new home's down payment, it must be sold first. Some home buyers rent their homes as an investment. Then, the current home won't need to be sold. Your loan counselor must assess your risk profile, including credit history, to see if you can borrow on a new house while keeping the title of the old one.
When moving for work, buyers need more time to sell their homes. If you are moving but staying with the same employer, ask if they offer relocation assistance.
The ability to browse for properties online and look at images before leaving your living room has revolutionized the home purchasing game. Comfort is at its peak. However, nothing surpasses seeing and feeling a home in person.
Your agent will require a check with a home offer. In good faith, earnest money shows the seller the buyer's offer is genuine. Earnest money reserves the home for you. If a deal is reached, earnest money goes toward the down payment and closing charges. If the deal fails, the buyer gets their money back.
Written offers should include a time limit within which the seller is expected to react to the offer. They should have enough time if you give it to them in twenty-four hours.
Sellers might choose to accept or decline the initial offer. Sellers can also counteroffer, a typical third option. Keep in mind that realtors routinely negotiate bids and counteroffers. Every amendment should bring the parties closer to a deal.
FHA and VA loans require home inspections. Other mortgage options do not require inspections. Nevertheless, home inspections are advised since they can find hidden defects. Home inspections make one of the most significant investments of a lifetime worry-free.
Final walk-throughs allow buyers to verify no changes since the last time they were there. If repairs were required in the offer, a follow-up visit confirms everything is done as per the contract.
Do you have other questions we didn't cover? If yes, feel free to drop them in the comments below.
Thank you!
Part of being a real estate agent is to answer real estate-related questions that curious home buyers and sellers might ask.
Whether you're a first-time or seasoned home buyer, seller, or real estate agent, here are some of the common questions that you might encounter:
Mortgage pre-approval is the first step in the home-buying process. It's important for many reasons, such as the following:
Purchasing a home takes 10-12 weeks. After selecting a home and accepting an offer, escrow typically takes 30–45 days. Well-prepared cash purchasers can buy houses quickly.
Market conditions affect how quickly homes sell. Home-buying may take longer in competitive markets with lots of sales activity. This is because multiple parties lag as business picks up.
In markets with numerous sellers, increased competition causes prices to rise. The following is a list of some of the factors that affect demand:
When demand for housing is low, and prices continue to decline, a market is said to be favorable to buyers. Long-term and short-term buyer demand may be affected by several factors, including the following:
When demand and supply characteristics in the same area vary depending on price point, this type of market is called a stratified market.
Buyers pay little or no agent fees.
Here are some reasons why:
In most house sales, one real estate agent represents the seller and the other the buyer.
Listing brokers charge sellers to market their property. Advertising can include radio, print, TV, and internet adverts. In the local multiple listing service (MLS), other local and national agents can search for the home for sale.
The listing broker pays buyer's agents for bringing buyers to the table. The buyer's agent and listing broker split the listing fee when the home sells. The buyers don't pay the agents.
FICO scores of 620 or above are required for most loans. Higher credit scores reduce lender risk, leading to lower down payments and better interest rates.
Homebuyers with weaker credit ratings may need more money to counterbalance the lender's risk.
Watch out for our Part 2 for additional questions to ask when getting into real estate.
Real estate investment is one of the most efficient and secure methods to increase your money and net worth. However, despite being a popular option for many people to increase their wealth, there are still questions, such as: "Are real estate investments good?"
To be clear, this post is not about buying houses to live in; instead, it's about purchasing properties for the sake of earning positive cash flow.
Having a roof over a head is a commodity, and that's more than enough reason for you to believe that there's money in real estate. Below are some ways how millionaires use properties as their investment:
Buying a property to be rented by tenants is a great source of passive income. Yes, you will spend money to purchase a house, but once it's ready for rental, you have monthly passive cash flow.
This option helps millionaires become more affluent, especially since it's not connected with their limited time. This also gives real estate investment an advantage over investments in stocks. When investing in stocks, you make money only after the stock's value increases and you sell it.
Occasionally, houses lose value, but real estate usually rises over time. As the loan is paid, your net worth increases and your property appreciates. Appreciation can be "forced" by specific property upgrades or caused by market growth.
If you want a property that both appreciates and increases its value, investing in an apartment is a good idea. Even if it's old and in bad shape, renovating the unit can help increase the rental fee and build value over time.
Owning property has various tax benefits. The government long prioritized real estate investment, so property tax deductions, no self-employment tax on rental income, and more help people cut their taxes. Despite earning more, real estate investors often pay less taxes due to tax perks. This is why millionaires had real estate investments.
One of the most significant advantages of real estate investment is the leverage capacity. Millionaires are aware that they are not constrained by their means. To increase your riches, you can use other people's resources.
There are four ways to increase your real estate strategy and invest alternatives through leveraging leverage;
Principal paydown helps real estate investors develop wealth. With each interest payment on your OPM mortgage, you pay back some principal and get closer to owning the house. This builds equity and wealth. That's even better when your renters pay down a cash-flowing income property and help you develop wealth and equity.
A property refinance involves a new mortgage. If your home has equity, you can refinance cash. Cash-out refinances are better because they are tax-free. You took this income tax-free. An intelligent investor will utilize this cash-out refinance to purchase more income properties and increase her fortune.
Investing in real estate did not only prove to be profitable; it also shows how effective it is in giving you more time and freedom.
If you're considering diving into this, our team at RE/MAX Advanced Realty - Indy Home Pros is here to help! Call us at 317-316-8224 or click this link to get started.
When talking about credit history, it is most likely related to how someone handled debt in the past and what is going on with their money right now. Credit history can include information about the accounts a person has opened, how long they've been open, and if the account holder made timely payments.
But there's a lot more to learn, such as how credit history is included in credit reports and how it affects credit scores and lending decisions. Understanding how these elements fit together will help you better manage your credit. And this post will help explain some of the basics.
Credit history is a record of how a person handles his finances like money, debts, credit cards, and other existing loans. A credit history may include information about a person’s account, how long they’ve opened, the in and out of the money on the account, and whether the account holder made payments on time. It starts when you apply for a credit card or a loan and can influence your financial life, so it’s important to build and maintain a positive history.
These are just some of the questions you might have in mind, and to understand and answer these, let’s dive deeper into credit history.
A credit report is a detailed listing of all your current and past debts, your credit cards and loans listed on your name how much you owe to lenders, and If you are good in paying your debt in time.
Credit score, on the other hand, is like a measure of how a lender can see you as trustworthy with money to pay for a loan. It’s a prediction of your credit behavior based on the information from the credit reports. It has a score ranging from 300 to 850.
There are things that affect your credit rating, including payment history for past and current debt, how you maximize your credit limit, and the length of your credit history.
So basically, it is a report on your debts, repayment of debts, and how you responsibly repay all of them. It is then added to your credit report, which includes a full breakdown of the number and types of loans that you have, the amounts owed, available credit used, the number of recent credit queries you have made, and invoices you have paid on time. It also indicates whether you have any bankruptcy, liens, or collections.
If you’re wondering how you can access information on your credit history, you can ask for a free copy of your credit report from credit bureaus.
You can see steps and view your updated credit reports at no cost online, too. Viewing it free online gives you an advantage to monitor if there are any changes in your credit.
Importance of Credit History
Credit history is extremely important, especially to lenders. When you apply for a personal loan, credit card, mortgage, and more, the information on your credit history is used to decide whether they will lend you financial help or not. They will also use the information on your credit history to calculate your credit score.
Lenders will review the credit history and assess your recent activities, the patterns, and regularity of repayment over longer periods. It’s good to have a positive credit history for a better chance of getting approved.
Good Credit History
When can you say you have a good credit history? It’s simple, having a good credit history means that you are paying your bills on time and you’re not carrying large amounts of debts with you. Having a good credit history means you are a lower-risk borrower. Getting a good credit history can get you a better chance of being approved for loans and having a lower interest rate.
You can maintain a good credit report by paying all your bills in full on time every month. Keeping at least one credit card is enough to maintain and keep the balances low, don’t exceed your limit and only use 30% of your available credit. By checking and monitoring regularly you can determine if there are any errors and can correct them as soon as possible.
Bad Credit History
Contrary to good credit history, bad credit history means you are not paying your bills on time and have a large amount of outstanding balance.
The question is: What can contribute to a bad credit history? Excessive use of credit cards above the limit, late or missed payments, having a lot of credit cards, and other financial loss.
When you have bad credit, it can lead to lenders finding it difficult to give you a loan, and if so, it will be at a higher interest rate and credit limits are low.
How can you turn bad credit history into good credit history? It’ll take time, and it may take years but slowly you can do it by paying your bills on time, cutting unnecessary credit cards, and checking your credit score which has the most negative factor, and starting from there.
Having No Credit History
Individuals who have no credit history are sometimes from the group of young adults and college students who don’t have yet credit cards or bills that are named to them. Having no credit history means it is difficult to get approved if you seek financing as credit history demonstrates the ability of a person to make payments on time.
How to start having a credit history?
You can start by taking small steps. Apply for a credit card that has a secured deposit. You can also become a supplementary user on another person's credit card and build your credit history. Don’t maximize the use of your credit card and paying your bills on time can help you get a credit history and a good one.
Bottom Line
Having the right knowledge to understand your credit history can lead you to good credit history. A good credit history can open doors for financial opportunities, increasing your chances of approval with lenders when you apply for a loan.
Having a good credit history also means you are offered better rates on loans. When you know what goes into your credit history, there’ll be fewer problems and you can strategize how you can maintain a good and strong credit report.
Getting your house ready to sell can create all types of stress and anxiety. If you’re like most sellers who are nervous and don’t know how to prepare, the right approach can attract the right buyers so you can have the best deal price possible for your home.
Selling your home can consume you a lot of time and can be overwhelming. Making your home ready can increase your chance of getting a solid offer from a buyer. Follow these must-do steps and have your home ready for the market.
The first step is to put yourself in a seller's shoes. Research the value of your home. You can gather a few pieces of financial information. Having the knowledge and idea about your estimated payoff amount on your current mortgage including your remaining balance, and interest can give you an idea of potential profit as you set your listing price.
You can do comparable sales of similar homes you have in your neighborhood, compare them, and figure out your appropriate listing price. You can also have an Indiana real estate agent and have your home CMA. The documents will then be compared to your home and the recently closed sales in the market to know and determine its list price. Look closely at this data. Pay close attention to various details such as square footage, location, and features.
List a professional Indiana real estate agent to list your home. Finding a listing agent can minimize your stress and maximize your profit. You can interview a listing agent and ask about their experiences around your location. You can determine if the agent is the right fit by asking them some questions, such as how much experience do they have, percentage of listing they can sell, and the plans on how to market your home.
They can guide you through the process and manage selling tasks, like social media expertise, marketing, pre-listing, and negotiating that can help you sell your house. A good real estate agent can give you advice on how you can aesthetically get your home ready for the market.
First impressions are everything. Your home must be properly staged when people have walked through. You want your home to be clean for potential buyers. Give your house a thorough cleaning, especially odors and stains. You don’t want any weird odor or stain to hinder you from having potential buyers.
You can also hire a professional cleaner to clean. It's relatively inexpensive and will consult you on the best way to lay out your space. This may be the easiest way, plus you won’t stress yourself from doing the physical labor.
Potential buyers want to imagine and envision themselves in the home. Remove all personalized decor and family photos to create a space that will look like a new home to help them imagine the house as their own. Once you have everything removed, decluttered, and depersonalized, you can ready your home to stage and have the perfect shot.
Getting a pre-sale home inspection is one of the investments you can make to have your home ready for buyers. They will want to know if anything has been fixed or needs fixing.
Buyers will have an idea and help alleviate any concerns. Any issues that the home inspector found can be addressed before putting it on the market. This can also make you at peace as you don’t need to worry if you run into any nasty surprises while in the middle of selling your home.
Of course, when you look for a house, imagine yourself in it. It helps when you see everything fully furnished. Same when you want to sell your house, staging your home can help in selling your house faster and get you more money.
The good news is that decorating your home’s interior can be easy and affordable. A home with furniture is easier to imagine than a blank slate. Making your home’s curb appeal from the living room to the dining and every room in the house.
Start on the outside of the home as buyers will have a first look at it before they enter your house. Make sure that the grass is cut and well maintained and everything has been removed (e.g., children's toys and playhouse). You can also apply a new set of paint on your exterior walls if needed.
When you decide to sell your house, you include photos to attract buyers to look for it personally. Uploading a high-quality photo can be a key to getting their attention, especially if the home is already staged and ready for photos.
You can do it yourself if you want to, with the right angle and lighting you can make a perfect shot for your home.
You can also hire a professional to take a photo of your home since they are more skilled in taking better shots they can make your home look good as it is personally.
The best time to sell a house is considered to be the month of May – homes tend to sell faster during this month. Still, it will depend on you on what’s the best time for it to sell and may consider different factors. If you’ve decided to sell your home, start preparing it right away. Make a list, set an estimated timeline, complete any necessary improvements, and get your home ready to sell.
Are you planning to buy a home?
If yes, one of the steps you have to consider is creating a financial plan. As they say, buying a property is a big financial decision, therefore, having a goal in mind is a must.
When pursuing financial goals, consistency makes a huge difference. Another helpful tip is listing down your budget and sticking it somewhere you can see it easily. This will help you stay motivated, accountable, and disciplined.
Below are more tips to help you reach your financial goals for your dream real estate in Indiana.
Saving is a portion of your income not spent on current expenditures. Most people put them in a bank while others put them in investments.
As we all know, financial freedom doesn’t just happen overnight. Therefore when saving money, you have to be consistent and committed to it. You can start by saving at least 10% of your total income per month. Depending on your income, you can increase this little by little until you reach your goal.
Pro Tip: When saving money, determine your short-term or long-term goals. This will help you from overspending or become mindful of your spending habits.
When setting goals, it should be three things -- realistic, achievable, and specific. This will help you focus on what you want to happen.
It might also help if you connect your financial goals to your "why." For instance, you live with your in-laws. Now, the reason you are saving a specific amount to buy a house is because you want your growing family to live on your own.
Set a clear vision of what you’re saving for. Identify whether you’re saving for emergency repairs, your down payment, or furniture.
When you identify what your goal is, stay focused. Giving it a purpose also makes your sacrifices easier and your success sweeter.
Think and put into consideration the goals that you want to achieve. Write and place them where you can see them visually. This will not only serve as a reminder but a way to keep yourself motivated and committed.
When listing down goals, it might also help to add a timeline for each step. This can help you focus on each one by one and be on the right path.
Saving a portion of your monthly income can sometimes be challenging, and you may seem not to notice any progress in the first few months. However, as the months turn into a year, it will add up to a significant amount as long as you stay consistent.
Emergency expenses cannot be avoided. This could lead to stress especially when you are caught unprepared. Below are some common reasons that cause financial trouble:
Unemployment Or Unexpected Unemployment
Becoming unemployed, whether unexpected or not, means the same thing -- having no source of income. Of course, the best way is to find a new job or start a business that can cover your expenses.
Lower Than Usual Income
Whether it's because of your lifestyle or an unexpected increase in budgeting, having lower than the usual income can cause financial strain. If experiencing this, you can re-evaluate your expenses, adjust your budget, and live below your means.
Accident Or Unexpected Illness
Unexpected illness or accident leads to your budget increase due to medical expenses and sometimes it seems like the income is not covering the expenses you need. You can still survive by simplifying your lifestyle. Ask for assistance by reaching out to certain agencies and getting all the help that you need.
Getting Pregnant Or Having A Baby
During your maternity leave, your budget increases due to no income during this period. You can adjust and reduce your budget so it will fit your expenses.
Family Issues
Every family has its ups and down. Whatever issues you may have, you can seek help.
They will always be there for you.
We can’t predict what would happen so the best weapon for all the uncertainties is having an emergency fund.
Feed your mind with information that can help you improve and become financially literate. You can use various online resources and financial books to help you learn more about financial goals and how to be successful in growing and managing your money. Remember, learning is a never-ending process.
You can also seek some experts or the help of a financial advisor who can answer questions you may have and help you stay on track with your financial goals. Plus, you can also discuss things like your life goals and offer pieces of advice that will help you achieve them.
Once you’ve learned and gained the valuable knowledge that you need from reliable resources, you should take it into action. Strive hard to do better, especially in handling and budgeting your finances. Apply all the learnings and knowledge you’ve acquired and manage all your finances wisely.
Can you still have fun even while fixing your finances, saving money, and lowering your expenses?
The answer is YES!
Learning how to handle your finances and changing your spending habits can still be fun and exciting.
Even while saving a portion of your income to buy your dream home, you can also allot a few dollars to buy something you like. Treating yourself for doing a good job or just wanting to buy for yourself occasionally can also make you motivated to stick to your budget in the long run. Additionally, reaching financial goals will make you feel empowered to keep pushing forward so make sure to celebrate any milestones along the way.
There are a few low-cost ways to celebrate. You can take advantage of the free perks you have or discounted prices on coupons. This way you will not feel guilty spending some of your budget.
Want to learn more about saving money for your down payment or dream home? If yes, feel free to visit our website by clicking this link.
8313 W. 10th St
Indianapolis IN 46234
dennis@indyhomepros.com
317-316-8224