Your twenties are a weird time. You’re not a kid anymore, but you’re not a “real” adult, either. Introducing yourself to the adult world can often be confusing and challenging, but this is all normal since this is the first time you’re facing some things on your own. This is especially true when it comes to finances. Now, you’ll need to learn to budget by yourself. The most important part of managing your money will be related to real estate. Real estate is a great goal to strive for, as it’s your chance to leave something behind, learn about investing, create a legacy, and set your future kids up for life. Learning these lessons about real estate financial planning before you’re 30 gives you enough time to put them into action.
1. Keep up with the market
How you should spend your money and plan for the future will best be dictated by the real estate market. It’s crucial to know exactly the right moment to buy and sell, so as to get the most out of your money.
Without a good knowledge of the current state of the market, how will you be able to differentiate a good investment from a bad one? Much like any other type of investment, you will want to get in while the market is strong and prices are relatively low. Once your real estate has accrued some value, you can think about cashing in on that investment.
2. Keep a good financial score
Having a good credit score is an extremely important aspect of your financial life, which is why it’s important to set it straight as soon as possible. When it comes to investing in real estate, your credit score needs to be pretty high in order for your plans to come to fruition.
Your credit score could mean the difference between being able to buy an apartment and losing out on the real estate market entirely. Banks will check your score before they even consider talking to you about a mortgage. Low scores can hamper young people from securing their first apartments or houses.
3. Create a good financial balance
Deciding whether to invest or save can be a difficult decision. Both have their merits and their downsides. As always, the truth is a mixture of both. You can’t call your financial plan rock-solid unless you have both on your mind.
Never put all of your eggs in one basket. The real estate market might be pretty stable right now, but you can’t possibly predict the future. Markets fluctuate all the time. If anyone could reliably say that a market is safe, everyone would decide to invest in it. There’s always an element of risk in investing and financial planning. Set some money aside to grow in trusts and consider investing in something safe, like bonds for example.
4. Don’t be afraid to ask for help
Sometimes you can be doing all you can to stick to your financial plan but still failing. The most common reason for failure is that people use one generic financial plan which doesn’t suit them. You have to be aware that people have different needs as well as different financial capabilities, so not everyone can carry out the same exact financial plan. Luckily, there are specialized companies like IMT Accountants & Advisors which can help you get the most out of your money.
With professional help, you’ll get an insight into real estate and financial planning you won’t get anywhere else. You’ll also be able to ask for help and additional advice on any topic that interests you. Being an adult means knowing that there are people out there who know things better than you. More than that, it means learning from them and expanding your knowledge. Who better to learn from about financial planning than professionals? By the time you’re 30, you can be somewhat of an expert, too.
5. Consider trading
Once you’ve gotten the hang of real estate financial planning, you might want to take it a step further. If you like the numbers that proper real estate investments return, you could delve even deeper into the market. Use your newfound knowledge of real estate as a stepping stone to flipping houses.
Flipping houses is a very lucrative business right now. By using funds that are left over from other successful ventures, you can renovate and improve a home and turn it into an even more profitable investment. For some, this turns into a side hustle which provides some pretty high profits every once in a while. Others turn it into a career. It combines the wisdom of proper financial management with the artistic talent of renovating and creating a comfortable and attractive home.
Though it may seem that real estate is something very complicated and serious, financial planning for it doesn’t have to be scary. With the tips above, you’ll be able to slowly but surely set foot into the world of real estate and use the knowledge you have for advancing in life and nailing every aspect of adult life.
This article has been contributed by Stella Ryne.