Have you ever put something off – maybe the washing up or a trip to the tip – and said ‘that’s something for future me to worry about’?
Not everybody will have done this. Plenty of us are keen to get all tasks and chores off their plate before taking a deep breath and relaxing.
But others are less fussed about such matters, happy to shelve things for their future selves to sort when the time is right.
If you delay the washing up too long, you might get a smelly kitchen and a distinct lack of cutlery to use. It’s unpleasant, but in the grand scheme of things, it’s not a disaster and is easily rectified.
But when it comes to buying a home, leaving things for later isn’t always the way to go.
I have plenty of time to buy a home – why rush it?
Well, don’t rush it of course! But don’t think that at some point everything will magically fall into place either, because life doesn’t really work like that.
If you are in your 20s or 30s and not yet a homeowner, then it’s easy to not be too concerned about what your living situation will be when you are at retirement age.
But not having a home that you can call your own when you reach retirement age is a circumstance many believe it’s best to avoid.
Why buy a home?
Sounds like a simple question, but it’s a complicated business.
Owning your own home and paying off a mortgage before you retire means that you will have a property that is unequivocally yours. This means you will have a place of your own that you will own outright. This in and of itself is enough reason for many people to seek a mortgage at an early age.
A second reason is the cost of paying for a property once you are past retirement age. Rent costs will continue regardless of your age, and although pensions and savings can help here, many would say it is preferable to not have to pay such outgoings once you stop working. In a worst case scenario, this need to keep paying rent could prevent you from retiring outright.
A third reason is that the closer you get to retirement age before purchasing a home means you will have less time to pay it off, given that most mortgages will have a repayment period of around 25 years. This means if you buy a home after the age of 40, you may want to have a shorter repayment period in order to pay off your mortgage before retirement. But that will mean higher outgoings for a sustained period. Sorting a mortgage earlier in life can reduce the amount you end up paying each month on your mortgage.
Fourth and finally, if you reach a stage where your house is too large for your requirements once in retirement, owning your home gives you the chance to sell up and downgrade. This presents the opportunity to secure a tidy sum of money that can then fund your living moving forwards.
Is now the time to move?
We can’t avoid the fact that purchasing a home at present isn’t the easiest thing in the world. The cost of housing is far from ideal when it comes to entering the market, and the general cost of living is limiting the ability of people to save the kind of funds that would allow them to get on the property ladder.
But that doesn’t mean that this is something to put off and let ‘future you’ handle outright. Much of the time, it’s actually more about your circumstances – both personal and financial.
For contractors and freelancers seeking a mortgage, having a steady amount of money saved up and ready to spend on a deposit for a home is a great position to be in. If this is something you are keen to move ahead with, then finding a contractor mortgage expert or freelance mortgage broker can help set you on the right path.
What’s more, owning your own home as a contractor or freelancer is advantageous because of the security such a purchase brings. The very nature of freelancing or contracting is that work is subject to change over time. Having a home of your own, particularly as you near retirement age, can give you the kind of stability that people seek.
The reality is the more groundwork you put in now, the happier ‘future you’ will be. A good step is getting some free mortgage advice, and seeing what could work for you when it comes to buying your own home.
