Saturday, November 11, 2006

Financially Fit

I just have a word of advice for the younger brothers in blogland. Get your finances in order. I know that in Black Families we don't learn a lot about finances. That is usually a secret topic. As a child most of the time we just know what we have and what we don't have. However, we rarely learn what we can have and how to get it.

Get your self ready to purchase a house. It may not mean a whole lot to you right now but ultimately one day you will want to purchase. Real Estate is one industry that you can bet will not end. However, it does go up and down in value. Right now it's up and looking at the total amount to purchase a house can scare the hell out of you making you think I could never afford that. That can not be further from the truth. With rent at an all time high you could actually be paying more for rent than you would for a mortgage.

A friend of mine is looking for an apartment right now because the building he lives in is going condo. He's not in a financial position to purchase the apt and frankly doesn't want to. He's been looking around town for a 1 or 2 bedroom apartment in decent areas of Los Angeles. The prices range from $1,300.00 to $2700.00 a month or more. Now why in the hell should you pay that much for something you don't own. My mortgage is more than half of that and I'll have much more space than he will find.

So get rid of the fear of buying a home by understanding what it entails. Even if your not ready to buy a house learn some of the basics.

How much would you have to put down for a house? That can be scary when you think 10% or more on a $200,000.00 home. (Don't move to L.A. cuz you probably wouldn't want to live in a $200k home. Now that's scary) At any rate if you start to save just a little bit of money each time you get paid you will have that down payment. You determine the amount. I can't tell you how much. Whether it's $50 or $100 you'll be surprised how quickly a year passes and you have saved from $1200.00 or $2400.00. In 5 years that's $6,000.00 or $12,000.00.

Just decide when it is that you want to buy a house and add that money up over that time period. You'll have your down payment. You'll have a mortgage that is more than likely less than what you are paying in rent.

There are many 1st time buyer programs out there that any bank can help you with. If your still a little nervous. Go to any bank website and look up mortgages and they'll have a mortgage calculator so that you can see what your mortgage payment will be. A word of caution that's not all you have to figure in. There will be those dayum fees that banks charge that could be from $3,000 to $5,000 in total. Don't worry that's just added to your mortgage. So $5,000.00 over 30 years is only $13.88. So add that and your taxes which could be about $200.00 a month. This will all help you remove that fear. Another thing you can get from these websites is terminology. They'll usually have definitions of all the terms.

My last word....Get rid of your credit card debt anyway that you can. Consolidate it into one card or whatever you have to do. It's good to have credit but it can also hurt you.

The only way Black people will have power is with financial fitness. Get fit! Even if your just saving $5.00 a paycheck.


BronzeBuckaroo said...

You have offered some very sound advice that I have taken to heart. Already, I am cautious in my spending habits. And, I have learned the difference between fixed and variable mortgages. I definitely don't want a variable rate. I HATE CREDIT CARDS!

Thank you for your kind words about my newbie blog. I truly appreciate them especially since they come from you. Your blog has inspired me in so many ways.

Playboy Adonis said...

Is this entry on finances going to be an ongoing thing at your site. This was informative. I like the picture too.

D-Place said...

I'm not an expert on the subject of finance, but certainly have begun to learn some things that I wish I had a long time ago. I'm glad that if nothing else I have sparked someone to at least think about thier finances.

Marz said...

HEYYYYYY!!!! (Hugs)

Picture relevance?

I think I got it, he doesn't have a house, he lives on the beach.

I need to get on so many things, because at work I'm making these people mess up their credit for a little discount. I am always standing there thinking, " I WILL NOT HAVE BAD CREDIT".


Frederick Smith said...

Thanks for the advice for the brothas! We need this kind of wake-up call. I was fortunate enough to buy rental property this year -- granted in another state, I'm still renting an apartment in L.A. (hard to buy something decent in L.A.) -- and I love the idea of owning something... even if I don't live in it.