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How do you know if you can afford a particular monthly payment? There are many factors involved; for example how much money you have saved or if you have a rich uncle who can bail you out when trouble comes. If you don't have a rich uncle here is good guide to manage your personal finances conservatively.
Assuming that you plan to pay off your mortgage debt via your monthly take home pay; a good guide is to spend no more than half of your monthly take home (after tax) on mortgage payment, property taxes, insurance and any other fixed cost you will have to pay each month (such as home owners association fees) combined. This way the next half of your income can be spent paying for food, utilities (water, heat etc), entertainment and saving for retirement!
In other words, the first half of your paycheck is used to pay on your fixed costs that you have to pay to have a roof over your head and the second half is spent on your variable costs which you have some control over for example turning the heat down, going with basic TV or eating out less. This is a good example to follow and be conservative and not get in financial trouble if things go south.
Rule of Thumb
Don’t spend more than you can afford, ½ of monthly take home pay is conservative
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