The 5 Basic Financial Categories – Part 6
Let me take you on a journey. Do you know anyone who’s ever purchased a home, but lost it. That was my story and we’ve discovered that’s the story of many. Most [that means the majority] will never see the day that their mortgage is paid in full. When we discovered this sobering truth we decided to seek a different way to live.
I have this question; whose job is it to teach us the business of buying and acquiring a home? I wish there was a DIY life manual for the business of running our life. Well, I have good news; that’s exactly what we’re doing at kerryaclark.com. In today’s article, we discuss the 5th basic financial category found in the Mint app: property.
No one ever taught me the value of having property and what that property can do for you. We simply thought we needed a nice place to live and hopefully one day own. Mint gave us a different image. It asked us to not just include our mortgage, the debt we owe, but the property itself so that it could calculate and asses the value of our home against the mortgage.
Owning Your Home
Getting a home isn’t just the act of getting locked into a 30 year mortgage. It’s more like having ownership in a business or buying shares in a company. With each payment, you have just gained a larger share or percentage of ownership in that company. Normal people spend more time focused on their payment from month-to-month rather than how much ownership they possess in the place. With this type of thinking, they do like I did when I lost a home; I left my ownership [my share] in the house for someone else. That’s crazy! The beauty [if their is any] in a mortgage is that each month you own more and more of the property until one day it’s all yours and no one else’s. I just didn’t know. With Mint, I’m able to see this percentage of ownership as well as how much of it belongs to the bank or mortgage lender.
Estimate of Property Value
Mint uses a tool to estimate the value of your home. Remember it’s not an exact science as it take an appraisal to give you the true value. Nonetheless, you have a benchmark for where it stands in the marketplace. Knowing this is important, you might just want to sell so that you can get your ownership out of it, especially if your finances are out of control. Regardless, the estimate provides the baseline Mint needs to give you your ownership and thusly your net worth.
Now that I have transformed thinking about our property, it gives us an advantage that ordinary folks don’t have. We can focus on increasing the property’s value and thusly gain a larger share in our property. The key is to find economical ways to increase the value of your home. Here are just a few ways we’ve helped to add value to our property:
- Pray over your neighborhood. Why pray? You want others to be interested in your neighborhood and more houses added. This brings your property value up and give you more shares in your home. Also, when you give your home and neighborhood attention in prayer, you get serious about making sure others don’t come in and devalue it. As they say, it [change] starts at home.
- Keep your neighborhood clean and encourage others to do the same. Set the example by keeping your home in the best condition possible; it’s contagious and spreads to your neighbors. A clean neighborhood is much more attractive to future buyers.
- Make upgrades to your home. Each year Pamela and I have projects we plan to perform to improve our home. It’s really not to increase the value, that’s just an added benefit. We believe that if God gives you a home, you should honor Him by making it the best home you possibly can. It’s a reflection of Him. In return, the upgrades add just a little more value and thusly increase your ownership share in the property.
Today is Friday!
We hope you’ve enjoyed this installment and provided a better picture of what home ownership means. Remember no one taught me this stuff and perhaps, you fall into a similar situation. This [the family plan] is our attempt to provide you with the DIY guide to creating the best life you can possibly have.
Question: what’s one takeaway you gleaned from this message on having ownership in your home? Leave a comment below.