Dear Friends,

At Christmas of 2007, my kids and I surprised my wife, Judy, with a puppy.  Over the years, our house has been a revolving door for dogs, and we’ve had everything from pound puppies to purebreds.  That Christmas, we were down to one, middle-aged dog, and I was eagerly anticipating life without canines.  But, I capitulated when my children convinced me to surprise Judy with our puppy, Holly.  Eighteen months and eight vet bills, fifteen grooming bills, twenty one organic dog food bills, and countless liver treat bills later, I’ve come to love the nine pound black fur ball, and I am so glad we have her!

Getting a dog can be a lot like getting a house.  The overwhelming excitement of having a new home can blind you to the implicit costs down the road. Yard maintenance, roof repair, wood rot damage, pressure washing, etc., are all incidental bills that will not feel so “incidental” if you don’t factor those things in on the front end!

I love the verse on the email today from Ecclesiastes 7 that says, “Wisdom is a shelter as money is a shelter.”  Over and over, I am reminded of the wisdom of taking a big picture look at your finances before jumping into the decision making process – about homes, schools, dogs, or anything else we’ve been talking about over the last few weeks.

As you seek financial shelter through a good home purchase, also seek the shelter of wisdom by considering the following questions before you decide to buy a home:

1. Do you have a working spending plan (budget), and are you saving some money each month toward an emergency fund (3 – 6 months living expenses in cash)?  If so, you’ll be in better shape when unexpected home ownership costs arise.  If not, you probably need to work on having an emergency fund in place prior to making a major financial commitment.
2. Are you able to put down a sizeable down payment (in 20% range) so that you are cushioned from a further downturn in the housing market?  And, are you willing to finance the house with traditional financing options (a 15 or 30 year fixed rate mortgage) in order to further protect your financial future by having a set mortgage payment?
3. Will you be able to make a clean break from other housing cost commitments (mortgages or rent) that you have once you purchase the new home?  If not, do you have a very conservative plan to cover those costs?
4. Have you and your spouse (or a close friend if you are single) talked about your long-term financial priorities?  If so, does adding a new or higher mortgage fit into those long-term priorities?
5. Have you considered your home buying decision in light of other (non-financial) priorities such as schooling needs, neighborhood needs, commute issues, etc.?  Does the decision make sense for you or your family as you weigh its impact on those priorities?
6. Have you sought the Lord’s guidance in the process, and do you feel that He is directing you to buy a new home?

If you have considered these questions and feel confident about moving forward based on your answers, I think that this economy provides a wonderful opportunity for some people to take the plunge into home ownership!  And, if you do decide to buy a home, I hope that you’ll take my advice and wait a few months before you add a new dog to the picture!

May God’s peace encourage you as you pursue financial wisdom and depend on His Truth.

Blessings,

Ron


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