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Buying vs. renting: What’s the best move?

Many people make the decision daily on whether they want to buy or rent a home—however, it’s a choice that is not to be taken lightly. Like everything, there are various advantages and disadvantages to buying or renting a home. We’re here to break down those pros and cons to help make your decision process a little simpler.

Buying a home

Pros

Acquiring a home has numerous advantages that aren’t provided when it comes to renting. First, the financial benefits: when you purchase a home, you build equity. If the value of your home increases, then you have the opportunity to cash in on that value if you eventually sell. Also, there are potential tax benefits—if you choose to itemize deductions, you can itemize your mortgage interest when you file your tax return and thus cut your tax bill. Not only that, if you have a fixed-rate mortgage, you won’t need to worry about the rising cost of rent.

In addition to the financial perks, there are other substantial benefits. When you purchase a home, it’s truly yours. You don’t have a landlord to answer to, which means you don’t need to worry about seeking permission for home upgrades—you’re free to make all the renovations you desire. You also eliminate the possibility of your landlord selling the home and having to quickly scour for a new place.

Lastly, there are some intangible benefits. When you buy a home, you feel a sense of pride and accomplishment—you’ve finally achieved your lifelong goal of buying a home. While there is a sense of pride in being able to pay your rent and bills, finally reaching your goal of purchasing a home is an entirely different feeling. There is also a sense of belonging and stability. You now have a place you can truly call home for years to come.

Cons

Despite some of the amazing pros of purchasing a home, there are a few downsides to ponder. The most glaring drawback: it’s expensive. Let’s face it—buying a home costs a ton of money. Between closing costs, home inspections, and possible repairs, it can become egregious. It’s also a considerable amount of money upfront—a typical down payment is around 20% of the home’s cost. For example, if you are attempting to secure a home that costs $200,000, that would require a $40,000 down payment.

Another downside—when you own a home, repairs are solely your responsibility. From a new roof to broken air conditioning, there is an exorbitant number of things to be taken care of. Some things like fire, wind, or hail are covered by homeowner’s insurance. On a case by case basis, water damage is sometimes covered. However, the cost of home repairs can add up quickly and rapidly deplete your bank account.

Lastly, there is always potential to lose money if your home value declines. The environment, amenities, seasons, and maintenance are determinants of your home’s value. Bad schools, poor roads, or neighbors who neglect their property’s appearance are all factors that could drastically decrease the value of your home.

Renting 

Pros

There are copious benefits when it comes to renting, like extreme flexibility. If you needed to quit your job, pack up, and move across the country, it’s more manageable to get out of a lease agreement than sell your home. Even if you wanted to move across the city, you have the freedom to do so, practically hassle-free.

Renting can also be significantly more affordable. It requires fewer upfront costs, aside from a security deposit, which is a fraction of what you’d spend on a down payment for a home. You also forego property taxes, which saves a notable chunk of money. You’re also not responsible for maintenance or repairs. All of those combined make your monthly payments more predictable—you’re not scrambling at the last minute for unforeseen costs.

Cons

While there are advantages when it comes to renting, like anything, there are also downfalls. One downside: your landlord can raise the rent, which could potentially cost you more in the long-run, compared to a fixed-rate mortgage. Factoring in the spiraling cost of rent is a tremendous thing to consider—according to CNBC, rents are rising at the fastest pace in two years. There are also no tax benefits, and there is no ability to establish equity. Various restrictions also apply when it comes to upgrades—most landlords won’t permit you to paint walls, install new appliances, or remodel. There is limited freedom on what you can change.

Deciding to purchase or rent a home is an enormous decision, and it’s not cut and dry either. There are various factors to think about when you’re questioning if you should continue renting or choose to make the big leap and acquire your own home. It’s critical to think about how long you want to stay in your home, how much money you have for unforeseen expenses, as well as if you’re carrying any debt. At the end of the day, it’s about you, your needs, and what works best for your lifestyle.

6 tips for stronger savings

If you’re wondering when you need to start saving money for the future, that time is now. Whether you’re saving for a trip, a house, a car, retirement, or something else, setting aside money now for future benefit is an action that has to be repeated until it becomes a habit. Here are several helpful suggestions—perhaps you’re already doing some of them. The more steps you take, the faster your savings will grow!

Tip 1: Avoid instant gratification

Some call it the 30-day rule. Before you make a significant purchase, wait a month. More often than not, your urge to buy the item has waned or passed completely. Now, you’re enjoying the effects of your patience instead of suffering from buyer’s remorse. A short wait can save you a lot of money.

Tip 2: Set up an emergency fund

One of the fastest ways to get in debt is to be financially unprepared for an emergency. This can include everything from a medical emergency or sudden job loss to unexpected car repairs. As a rule of thumb, you should have at least 3–9 months’ worth of living expenses saved up for these situations.

Tip 3: Record your expenses

When you document your purchases, you avoid the familiar “where did all my money go” scenario. This includes even small purchases, such as that fancy cup of coffee. If you want, you can cross-reference your list with your bank statements to ensure accuracy. Now that you’ve collected your data, break it out into categories (gas, groceries, rent, etc.). Where can you trim? Are you going out to eat too much? Maybe it’d be better to brew that java at home.

Tip 4: Automate your savings

Virtually all banks and credit unions offer automated transfers between your checking and savings accounts. Determine an amount that can be automatically transferred and saved without straining your budget. You’ll be surprised how fast your savings account grows. Just set it up and forget it.

Tip 5: Renegotiate your terms

Whether it’s your cell phone or cable bill, the closer you are to the end of your contract, the more leverage you have to get a better deal. Call and ask to speak to the retention department. Let them know that you are considering a new provider and see what they offer to keep you as a customer. You’ll be surprised at how much you can save. Also, keep an eye on aggressive offers from its competitors. It may be time for a switch. The same goes for your home and auto insurance. Get a quote to make sure you’re getting the best price.

Tip 6: Install a programmable thermostat

Why pay to keep your house or apartment comfortable while you’re away? Programmable thermostats can be set to reduce your heat or air conditioning use during certain times to boost energy savings. According to Energy Star, you can save approximately $180 a year with a programmable thermostat. Now that’s a
good investment.

This is just a small sample of what you can do to maximize your budget and savings. The important thing is to get started!

Thumbs Up, Bucks Up 2019

Credit Card Late Fees: What You Need to Know

Our very own Principal Experience Officer, Adam Marlowe, was recently featured in a Yahoo! Finance piece on credit card late fees. Read the whole article here.

“For one, late fees can cost you even more in added interest charges and contribute to an ongoing cycle of debt if you aren’t careful. “Most credit card companies will add the late fee to your balance on the card. The downfall is that if you don’t pay the late fee, the credit card company will earn interest on your late fee,” says Adam Marlowe, principal experience officer for Georgia’s Own Credit Union.”

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On the Money: 10 podcasts that are guaranteed to make you smarter with your cash

Podcast popularity is at an all-time high, and the number of listeners, especially among millennials, is continuing to skyrocket. Today, in 2019, there are more than 700,000 active podcasts and over 29 million episodes. According to Apple, these numbers stood at 550,000 and 18.5 million respectively just one year ago.

People listen while they’re at home, in the car, commuting to work, and at spinning at the gym. They’re running errands, waiting in the doctor’s office, shopping for groceries, and walking to their next class.

You can find a podcast on almost any topic—comedy, business, news, politics, pop culture, religion, and more. Many listeners use them not only for entertainment, but to be inspired, to stay educated and informed, and to learn something new.

Money is an especially popular podcast topic. You can tune in to any number of shows that offer advice about saving, investing, paying off debt, and every other way to maximize your financial future.

We’ve put together a list of our favorite money-themed podcasts. Check them out when you have a few minutes. They’re guaranteed to deliver great financial content and sound advice:

1. Stacking Benjamins

Hosted by Joe Saul-Sehy, it’s a combination of financial education and comedy delivered straight from his mom’s basement. Together with “the other guy” and “crazy neighbor Doug,” you’ll learn about investing, creating multiple income streams, and other essential money management strategies. Be careful where and when you listen, though, because this show is laugh-out-loud funny.

2. Girlboss Radio

What’s it like to be a woman in charge? Ask American businesswoman and host of Girlboss Radio, Sophia Amoruso. She talks in depth about the world of entrepreneurship and how women can rock the virtual corner office. Her podcast is not an exclusive women’s club, though. Girlboss Radio can help any listener define their own personal meaning of success and create a plan to get there. Tune in, and you’ll hear honest conversations with trailblazing women who are sharing, showing, and encouraging others to own their future, too.

3. The Side Hustle Show

Nick Loper is the Chief Side Hustler at Side Hustle Nation. He’s the host of the top-rated weekly podcast called the Side Hustle Show.He’ll teach you how to maximize your time and amplify your earning power through additional income streams.If you want to be a successful entrepreneur, this is your guy.

Nick used to work for corporate America during the day and worked on building his side business at night. He’ll share his experiences and advice as well as tips and business strategies from other successful entrepreneurs he features on the show.

4. Afford Anything

Paula Pant is a real estate investor and blogger. Throughout her award-winning podcast, she’ll tell you that you can afford anything, just not everything. She wants to help you build a better life, and that begins when you make decisions about how you spend money, where you spend your time and energy, and on what you focus your attention. Every decision, big or small, is ultimately a trade-off against something else.

Pant interviews a wide variety of guests, including entrepreneurs, investors, millionaires, artists, scientists, adventurers, productivity experts, world travelers, and just plain regular people. She uncovers and shares their secrets about how they’ve cultivated an extraordinary life and connects them with practical application in the lives of her listeners.

5. Smart Passive Income

Pat Flynn is an entrepreneur and the host of Smart Passive Income. His weekly show features interviews, strategies, and advice about how to establish an online business that’s optimized for passive income.

Flynn uses his own experiments, successes, and failures to show his listeners how to make more money and save more time. While the internet is flooded with resources that can help entrepreneurs build a business, Flynn believes that properly tested ethical advice is what’s missing. During his show, he shares the specific strategies that have worked for him, and, to prove it, he publishes his income report each month.

6. So Money

Host Farnoosh Torabi is a top-rated female host with an award-winning financial podcast. Her podcast, So Money, was voted one of the best at helping you grow your business. She has a knack for attracting top names in business and entrepreneurship and delivers candid conversations about creating a richer and happier life. Torabi’s goal is that her listeners will find inspiration, will be motivated to dream bigger, and ultimately live their best financial lives.

7. ChooseFI

Learn how to reduce expenses, pay down your debt, maximize credit card rewards, and more with hosts Jonathan Mendonsa and Brad Barrett. It’s all about guiding you down the path to financial health and independence for these two. But make no mistake, a happy life is not just about the money. If you want to optimize your life—and your finances, while you’re at it—these are your people. They’ll help you clear away the noise, figure out what’s important, paint a clearer picture of what you want, and then help you build an intentional plan for how to get there.

8. The Tim Ferriss Show

Tim Ferriss is an author, best known forThe 4-Hour Workweek. His podcast is frequently ranked as the #1 business podcast of all Apple Podcasts andhas surpassed 300M downloads. In each episode, Tim interviews high achieving, world-class performers like Arnold Schwarzenegger, Vince Vaughn, and Tony Robbins, for example, who share their insights on business, productivity, and life hacks. He’s able to break down each guest’s approach into routines, tactics, and tools that the listener can practically apply to their everyday lives.

9. Money for the Rest of Us

Financial expert Davis Stein’s goal with this podcast is to help improve his listeners’ retirement IQ. He walks his audience through the process of building a retirement nest egg that will support them in their golden years. That may be decades away for some of us but stay with us. This is not your grandparent’s podcast. Stein offers emphatic lessons on building wealth and investing for the long term. The sooner you start, the more time you have, and the greater the opportunity for financial freedom in the future. We’re talking to you, millennials.

10. Radical Personal Finance

Joshua J. Sheats is a financial advisor and the host of Radical Personal Finance. He’s a straight talker who has no qualms telling you that the responsibility of your current and future financial health is 100% on your shoulders. In his show, Sheats delivers the information and the actionable items that will bridge the gap between the life you envision and the reality of your current life. He focuses on in-depth, no fluff content and education, stories and strategies, practical steps, and critical thinking that will help turn your vision into a reality.

Cyber Security Tip: Who’s that friend request from?

Social Media friends or foes?

Cyber criminals often create fake profiles to befriend you. The ultimate goal is to get you to leak confidential data to them (either about you or the company you work for). Be careful of the friend requests you accept on any Social Media sites (Twitter, Snapchat, Instagram, Facebook, LinkedIn, etc.).

Trust no Social Media “friend” (unless you know them in real life and you’re absolutely, positively sure they can be trusted).