My wife and I put in an offer on our house in January, but because of the coronavirus, we didn’t close until May.
Despite the economic uncertainty caused by the pandemic, we decided to go ahead with the process for a few reasons.
We looked at our financial plans from a “worst-case scenario” perspective and used that guidance to decide how much house we could afford.
We also looked at our long-term goals and plans and decided buying a house fit those plans.
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Buying your first home can be a stressful enough process in the best of times. But doing it during a global pandemic? Talk about an extra layer of complexity.
That, however, is exactly what my wife and I did earlier this year.
To be fair, we started the home-buying process before COVID-19 rampaged through the country in the spring of 2020. We began planning a year or two earlier, and started to actually look for homes in the fall of 2019.
We put in an offer on the property we wanted to buy in mid-January. Due to a number of factors, including the sudden shuttering of all businesses and offices (including our closing attorney’s), we didn’t close until May 13.
It was a very long, nerve-wracking process, not helped by the uncertainty and fear everyone felt as we quarantined and watched the stock market wobble around throughout March and April.
But through it all, we didn’t question our decision to make this massive purchase in the middle of a complete economic upheaval — and I think that demonstrates the power of good financial planning.
Why the pandemic didn’t change our home-buying plans
I’m a financial planner; planning is what I do for others for a living. We take our own personal planning very seriously as well, and spent hours and hours just discussing this potential money move.
That was before we actually sat down to run projections, evaluate scenarios, and determine what was financially feasible to do. It’s important to get clarity on what you actually want and value before you ever turn to the numbers.
There are always tradeoffs to make, or levers you can pull to adjust things so that your financial plan works. You can retire earlier or work longer. You can reduce expenses now or in the future; you can push goals further out on your timeline or drop a goal to make room for another priority.
The combinations of actions to take are endless and there are very few objectively “right” answers because of the countless variables at play. What the best answer is for your situation comes down to your values and priorities. Because you do have options, knowing what you truly want is a critical starting point.
Once you feel clear on what you want, then you can sit down with the numbers to see …read more
Source:: Business Insider