• 03:02:20 am on January 19, 2009 | 0
    Tags: , , , , , ,

    Is your home your castle or your dungeon?

    homecastleWhat a fantastic finish to 2008!

    I hope that all of our readers – following the ‘live out loud’ examples of our 7 Millionaires … In Training! – now have a great idea of how much money they need, by when, and roughly what ‘tools’ will be required to get you all there?!

    If you have, then you are already ahead of 99% of the population, and you have barely begun your journey! If you haven’t … well. what are you waiting for? It’s all laid our for you in the archives of this blog.

    Now, our journey takes a giant step into …

    … the present.

    Now, I would like you to simply take a look at a number of things IN RELATION TO YOUR CURRENT PRIMARY RESIDENCE, which is likely to be your biggest expense/asset/liability:

    1. What is your home’s current value (this should be reflected in your NetworthIQ profile as an asset)?
    2. What is your current mortgage (the total $ value should be reflected in your NWiQ profile as a liability)?
    3. What is your current monthly mortgage payment – both as $ and as a % of your ‘usual’ after-tax income
    4. How does your current setup fit within the 20% Rule and the 25% Income Rule?
    5. What – if anything – do you plan to do about it, if you currently break either/both of these rules?
    6. What are your plans for your first home (if you currently rent) or your next upgrade (if you currently own)?
    7. What questions/issues/opportunities, if any, that you would like to explore further do the above questions bring up?

    [Note: the 25% Income Rule applies to either rent or mortgage … the 20% Equity Rule obviously only applies to a house you own … both rules only apply to the home you currently live in, NOT an investment property that is rented at ‘arms length’ i.e. as a real ‘business’, not subsidized housing for friends/family/etc.]

    Remember, this is not a test: we are here to learn from each other, rethink things we may have taken for granted and ask / answer questions …

    … this ‘grand experiment’ will all evolve slowly over time (that’s why I have allowed 7 years), although you may (and, I hope!) have occasional ‘aha’ moments: it’s the combination of the gradual and the unexpected that will (eventually) take you to where you need to go …

    … all the best for 2009.

     

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