Some Tips for Tax Time

It’s Tax Season…

As we all struggle to pull together the previous year’s financial records, often we find ourselves wondering “How much of this stuff do I really need to hold on to?” This easy reference guide will help you decide what to keep, and what to toss!

PERMANENT PERSONAL RECORDS
You should keep the following documents INDEFINITELY (forever!):

• income tax returns
• income tax payment checks
• investment trade confirmations and statements
• important correspondence
• legal documents
• retirement and pension records
• CPA audit reports

PERSONAL TAX RECORDS
Hang onto these records for SIX YEARS:

• supporting documents for tax returns
• accident reports and claims
• medical bills (if tax-related)
• sold property records, contracts, receipts
• sales receipts (if tax-related)
• utility records (if tax-related)
• other bills (if tax-related)
• settled accident claims

SHORT-TERM PERSONAL TAX RECORDS
Hang onto these records for THREE YEARS:

• credit card statements
• medical bills (in case of insurance disputes)
• utility records (for internal use)
• expired insurance policies

PERMANENT BUSINESS RECORDS
You must keep the following documents FOREVER (yes, forever!):

• income tax returns
• income tax payment checks
• annual financial statements and books of account
• corporate documents (incorporation, charter, by laws)
• stock records & retirement / pension records
• licenses, patents, trademarks, and registration applications
• investment trade confirmations and statements
• documents substantiating fixed asset additions
• important correspondence & legal documents
• CPA audit reports

BUSINESS TAX RECORDS
Hold onto this paperwork for SIX YEARS:

• bank reconciliations and voided checks
• canceled payroll and dividend checks
• personnel and payroll records
• purchase & sales records
• travel & entertainment records
• supporting documents for tax returns
• sold property records, contracts, receipts
• sales receipts (if tax-related)
• utility records (if tax-related) & other bills (if tax-related)
• vendor invoices

IN-HOUSE BUSINESS RECORDS
Keep the following documents THREE YEARS:

• monthly financial statements (for internal purposes)
• credit card statements
• utility records (for internal use)
• employment applications
• expired insurance policies

SPECIAL CIRCUMSTANCES
You should retain these records according to the following guidelines:

• car records (until the car is sold)
• credit card receipts (until verified on statement)
• insurance policies (for the for life of policy)
• mortgages / deeds/ leases (6 years past life of agreement)
• pay stubs (until reconciled with your W-2)
• property records, contracts, receipts (until property sold)
• sales receipts (life of warranty or the life of the item)
• stock and bond records (6 years beyond selling)
• warranties and instructions (for the life of product)
• other bills (until payment is verified on the next bill)

Experts advise that most items which fall into the “Permanent Records” category should be kept in a safe deposit box or a fireproof safe. In addition, keep a written inventory of valuable papers in a home storage file. Give a copy to a trusted friend and update it annually. Your real goal should be to keep from accumulating so much paper in the future. You may think that you have no control over the mountains of unwanted paper that come to your home or office, but you’re wrong. You can request to have your name REMOVED from the mailing lists that solicitors buy - effectively cutting off up to 75% of the junk mail that you get! Contact the following organizations:

· DMA Mail preference service (PO Box 9008 / Farmingdale, NY 11735-9008)
· Stop Junk mail Association (800-827-5549)
· Private Citizen (800-cut-junk)
· Haines & Co./Criss-Cross Directory (8050 Freedom Pkwy. NW / N. Canton, OH 44720)
· Consumer Research Institute/Stop The Junk Mail Kit (PO Box 612 / Ithaca, NY 14851)

Just because you cleaned it out, does not mean that it goes in the trash! Did you realize that once you put anything out in the garbage, it becomes public property? And reports of IDENTITY THEFT are increasing every day - when someone else gains access to your personal records and pretends to be you to take out loans, charge credit card bills, and run up a tremendous amount of debt in your name. It can take years to clear up the legal and financial problems this causes you, and it can temporarily ruin your credit. Any paper that contains account numbers, your social security number, or any other sensitive information should be SHREDDED.

Four Pricing Tricks to Help Sell Your Home Faster

If you're selling a house in today's sluggish economy, make sure the price is right.

Americans are constantly buying stuff. But most of us don't do a whole lot of selling -- which means we don't have much experience at setting prices.

Want to improve your odds of finding a buyer? As you try to unload your home, consider these four pricing tricks.

1. Looking slim. We all know that $1.99 is barely less than $2. Yet retailers continue to use this trick -- because there's ample evidence it works. "When we look at prices, we make judgments in a fraction of a second," explains Manoj Thomas, a marketing professor at Cornell University's Johnson Graduate School of Management. "We read from left to right. We anchor our judgment on the first thing we see." For instance, if you're trying to sell your old car that you think is worth $8,000, you might set the price at $7,999. Potential buyers will read the seven first -- and have a sense the car is cheaper than it really is. Alternatively, you might start at $8,222 and then quickly drop the price to $8,111. One study of price comparisons found that, if the left digits are the same, buyers will focus on the right-hand numbers. At that point, buyers perceive the discount to be larger if those right numbers are declining from, say, two to one rather than from nine to eight. Even though the decline is the same in dollar terms, "people think they're getting a better deal," says one of the study's co-authors, Robin Coulter, a marketing professor at the University of Connecticut.
2. Stacking up. As buyers check out your your house, they'll have in mind a price they are willing to pay. The good news: You can influence that price. "You should list higher than you're willing to accept," says Alan Cooke, a marketing professor at the University of Florida's Warrington College of Business. "If you ask a high price, people use that as information in setting their reference price. But there's also evidence that, if you set a price that is implausibly high, the impact will be less than if you set a price that's more reasonable." In addition, you can affect the reference price of buyers by, for instance, sharing the price of competing properties in the neighborhood. The obvious caveat: Only pass along this information if the comparisons are in your favor.
3. Sending messages. Imagine you're selling your house, which you figure might fetch a little under $600,000. A round number, such as $595,000, will convey quality, while a precise number, like $595,385, will indicate a bargain. The reason: We associate precise numbers with lower-priced goods. A precise number may also signal that you have given a heap of thought to the price and you aren't inclined to negotiate. Trying to settle on an asking price for your home? "If it's a new development and you're trying to give the impression of prestige, you would want to go for the round number," advises Vicki Morwitz, a marketing professor at New York University's Stern School of Business. "But if you're going for the quick sale and you want to give the impression of a bargain, you would want to go for the precise number."
4. Cutting prices. In today's housing market, many homeowners are struggling to find a buyer. Thinking of dropping your asking price? Suppose that, as in the above example, you initially asked $595,385. If you lower the price to, say, $578,495, potential buyers may perceive the price drop as relatively modest. "You want to make the computation as easy as possible," Cornell's Prof. Thomas says. "If you use digits that make computation difficult, it will lead to a perception of a small difference." What to do? You might specify the dollar discount -- or, alternatively, lower the price from $595,385 to maybe $580,385 or $575,385. That way, it will be easy for buyers to calculate the price drop.

Existing Home Sales Rise In February

By Jeff Bater From The Wall Street Journal Online
WASHINGTON, March 24, 2008 -

Sales of existing homes increased in February and remain within a fairly stable range, according to the National Association of Realtors®.

Existing-home sales – including single-family, townhomes, condominiums and co-ops – rose 2.9 percent to a seasonally adjusted annual rate (1) of 5.03 million units in February from a pace of 4.89 million in January, but remain 23.8 percent below the 6.60 million-unit level in February 2007. The sales pace has been in a fairly narrow range since last September.

Lawrence Yun, NAR chief economist, said the gain is encouraging. “We’re not expecting a notable gain in existing-home sales until the second half of this year, but the improvement is another sign that the market is stabilizing,” he said. “Buyers taking advantage of higher loan limits for both FHA and conventional mortgages will unleash some pent-up demand. As inventories are drawn down, prices in many markets should go positive later this year.”

The national median existing-home price (2) for all housing types was $195,900 in February, down 8.2 percent from a year earlier when the median was $213,500. Because the slowdown in sales from a year ago is greater in high-cost areas, there is a downward pull to the national median with relatively fewer sales in higher priced markets.

Home prices within metropolitan areas are more telling. The most recent data shows roughly half of the metro areas in the U.S. with price increases, with healthy gains in markets such as Oklahoma City and Trenton, N.J. “In other areas such as Sacramento, a rapid price decline has induced buyers to come into the market and sales are now rising,” Yun said. “The relationship between home prices, interest rates and income has improved to the point where buyers are more serious about making offers.”

According to Freddie Mac, the national average commitment rate for a 30-year, conventional, fixed-rate mortgage rose to 5.92 percent in February from 5.76 percent in January; the rate was 6.29 percent in February 2007.

NAR President Richard F. Gaylord, a broker with RE/MAX Real Estate Specialists in Long Beach, Calif., said that negotiation and knowledge are even more important in the current market. “Consumers need to be aware of local market conditions and comparable sales prices to have a clear picture of a home’s value,” he said. “Realtors® understanding of local markets, negotiating expertise, and transaction experience are invaluable to both buyers and sellers, today as much as ever.”

Total housing inventory fell 3.0 percent at the end of February to 4.03 million existing homes available for sale, which represents a 9.6-month supply (3) at the current sales pace, down from a 10.2-month supply in January.

Single-family home sales increased 2.8 percent to a seasonally adjusted annual rate of 4.47 million in February from an upwardly revised 4.35 million in January, but are 22.9 percent below 5.80 million-unit level a year ago. The median existing single-family home price was $193,900 in February, down 8.7 percent from February 2007.

Existing condominium and co-op sales rose 3.7 percent to a seasonally adjusted annual rate of 560,000 units in February from a downwardly revised 540,000 in January, and are 29.7 percent below the 797,000-unit pace in February 2007. The median existing condo price (4) was $211,700 in February, which is 4.9 percent lower than a year ago.

Regionally, existing-home sales in the Northeast jumped 11.3 percent to an annual pace of 890,000 in February, but are 26.4 percent below February 2007. The median price in the Northeast was $264,800, up 0.4 percent from a year ago.

Existing-home sales in the Midwest rose 2.5 percent in February to a level of 1.24 million but are 19.5 percent below a year ago. The median price in the Midwest was $143,900, which is 7.1 percent lower than February 2007.

In the South, existing-home sales increased 2.1 percent to an annual rate of 1.99 million in February but are 22.0 percent below February 2007. The median price in the South was $163,400, down 8.6 percent from a year ago.

Existing-home sales in the West slipped 1.1 percent to an annual rate of 920,000 in February, and are 29.2 percent below a year ago. The median price in the West was $290,400, down 13.4 percent from February 2007.

The National Association of Realtors®, “The Voice for Real Estate,” is America’s largest trade association, representing 1.3 million members involved in all aspects of the residential and commercial real estate industries.

COMING SOON!

Be on the lookout for the first part of my Happy Clients series, with stories about previous clients I have helped, testamonials, and pictures!

Myths About Homeownership from Freddie Mac

See original article on www.freddiemac.com

How lenders assess mortgage applications has changed a lot in the last 20 years. What closed the door to homeownership then may not be a factor today.

The following are some common homeownership myths:

Myth: You need great credit to become a homeowner.
Fact: You may still be able to buy a home and you have less-than-perfect credit. And remember, you can improve your credit over time. But if you are buying a home and you have less-than-perfect credit, talk to a housing counselor who can help you avoid a mortgage you can't afford. It is important to comparison shop. Be wary of a lender who tells you, "Your less-than-perfect credit means that no one but me will work with you to find you a loan."

Myth: You need to put 20% down to buy a home.
Fact: There are many types of mortgage products and programs that allow low and no down payments. But remember that your interest rate may be higher for a low or no down payment loan. Also, be sure to factor in other costs such as closing costs, property taxes, moving expenses, and repairs.

Myth: You can't buy a home in the U.S. if you're not a citizen.
Fact: If you're a permanent or non-permanent resident alien, you can purchase a home in the U.S.

Myth: If you don't have a bank account or credit cards, you can't qualify for a mortgage.
Fact: Having a bank account is always a good idea and helps you establish credit. However, lenders can approve you for a mortgage even if you don't have a bank account or credit cards. You'll likely need to keep records showing a history of payments you've made for items such as rent, utilities, and car payments.

Myth: Lenders share your personal financial information with other companies.
Fact: By law, banks and other financial institutions are restricted in their uses and disclosures of information about you. In some situations, you may choose to restrict the disclosure of your information if you don't want it to be shared. If you are unsure how your information will be used, don't be afraid to ask – it's your right to know.

Myth: If you're late on your monthly mortgage payments, you'll lose your house.
Fact: If you have a financial hardship, like the death of your spouse or a medical emergency, and fall behind, it's possible to keep your home and get back on track if you contact your lender early. Even if it is not possible to keep your home, you can sell your home and possibly buy a less expensive one rather than face foreclosure.

Myth: You can't get a mortgage if you've changed jobs several times in the last few years.
Fact: Not true. You can change jobs several times and still get a loan to buy a home. Lenders understand that people change jobs. The important thing is to show that you've had a stable income.


Get more information on how to avoid predatory lending.

The What-Not-To-Do List For DIY Home Renovations

By Jennifer Saranow From The Wall Street Journal Online

Some home renovation jobs are a lot harder than they look. Here are five standard DIY projects that inexperienced renovators routinely mess up, and some tips from the pros.

The Job: LAYING BRICK PATHS
The Pitfalls: If the foundation under your pavers isn't hard and level, within six months and after enough rain, your path may look more like an old, crooked, cobble-stone street.
The Pros Say: Unless you're going for the old, crooked, cobble-stone street look, stick with spaced out, individual stones. They are a little less formal, "so you can get away with not having the foundation as straight and solid," says Brad Little, president of Case Handyman and Remodeling Services in Charlotte, N.C.

The Job: REMOVING WALLPAPER
The Pitfalls: Removing part of the drywall along with it, resulting in pitted walls that need to be repaired or even replaced.
The Pros Say: If the wallpaper was put on incorrectly in the first place, drywall holes may be unavoidable when you try to remove it, says Lou Alvarado, owner of Handy Husband in Atlanta, Ga. Try to soften the glue behind the paper first with a steamer or a wallpaper removal product such as Diff. If the paper doesn't come off easily, you're probably just asking for trouble. Leave it on and prep for painting over it instead.

The Job: REMOVING "POPCORN" CEILINGS
The Problem: Getting rid off the tacky ceiling texture, popular in the 1970s and 1980s, can be a messy, dirty, back-breaking process that results in ceiling gouges or worse--some of the stuff just won't come off.
The Pros Say: Never scrape a dry ceiling. Wet it first with a garden sprayer and then scrape with a putty knife, says Mr. Little. The texture should come off in neater clumps. And there's less risk of ceiling holes.

The Job: PATCHING DRYWALL
The Pitfalls: Inexperienced fixer-uppers routinely fill holes in sheet rock with too much joint compound and use the wrong-width knives. The result can be bumpy walls that look a lot like a rough, textured ceiling, says contractor David Wise of Mini Jobs in Atlanta.
The Pros Say: Use a six-inch knife to smooth the first coat of joint compound and eight-inch and ten-inch knives for the following two coats. For an even smoother surface, try using less compound for each application and apply four or five extra-thin coats instead of just three coats.

The Job: BUILDING A DECK
The Pitfalls: Bolting the deck right onto your roof or house frame without putting a layer of metal flashing in between. That can lead to leaks and water damage, says John Schmitt, owner of Kingston Custom Builders in Fairfax Station, Va. Also, DIY decks often wind up with frames and railings that aren't up to code or are crooked and saggy, thanks to too shallow or improper foundations.
The Pros Say: Inexperienced renovators, don't try this at home. Leave it to experienced contractors.

Real-estate strategies for the new year

Bankrate's Steve McLinden predicts that home values will stabilize again.

For sellers whose circumstances demand that they sell in today's soft market, he offers several tips, including:

• Realize that your house is worth only "what someone is willing to pay" and price accordingly. Throw in incentives like a free flat-screen TV, or offer financial assistance like helping the buyer secure financing or covering closing costs.
• Spruce up your house -- don't try to sell "as-is" unless you're willing to sell for a bargain-basement price.
• Look for a seasoned real-estate agent with a high percentage of sold homes.
• Know your local market well.
• Get your listing online.
• Try renting out your house instead of selling or offering a lease-to-own option to renters.
  

For buyers, he recommends not waiting to pounce on good deals, as the housing market may be "at or near bottom," and using the glut of homes on the market and sellers' anxiousness to sell to bargain more effectively. Make your purchase contract contingent on the home passing inspection, obtaining buyer financing, etc., he says. Do your research on the local market, noting asking and selling prices, and don't overlook "diamonds in the rough" -- residences that aren't cosmetically attractive, but have good bones, he says. He also suggests factoring in a house's potential resale value before making a purchase.

Great advice, Steve!

Potential major tax relief for Atlanta home owners!

Major tax relief for city of Atlanta residents?
Legislature could triple homestead exemption

By D.L. BENNETTThe Atlanta Journal-ConstitutionPublished on: 03/06/08

Substantial property tax relief may be coming for many Atlantans who own and live in their homes.

Atlanta members of the Georgia House of Representatives agreed Tuesday to support a bill that would more than triple the homestead exemption for city residents of more than five years. The delegation last week approved similar bills applying to school and county taxes.

Read the rest of this story here!

Go me.....I won an award!

To my pleasant surprise, at our annual awards banquet last week my colleague Andrew and I won an award for being the #1 Sales Team in 2007. Very exciting!!!!! We even got a trophy. =)

12 Things I Wish I Had Known In College

1. Credit cards are evil. =)
2. Buy & read David Bach’s The Automatic Millionaire and Smart Women Finish Rich…and live by them!
3. Create a budget and stick to it! Track your spending so you know where your money is going. Ideally all your "essential" spending -- taxes, food, shelter, clothing, and the rest -- comes out of the first 60% of your total, pretax income. The rest, in 10% chunks, is devoted to retirement savings, emergency savings (or debt repayment), short-term savings for irregular expenses (like holidays and car repairs), and fun money.
4. Immediately contribute AT LEAST 10% of your pre-tax income to your 401k. 15% is better. What you never see, you won’t miss, but it is a lot harder to make that adjustment down the road when you are used to having (and spending) that money in your paycheck each month, and you will see drastically higher returns the earlier you start saving. Compound interest is your friend!
5. Open a Roth IRA and start contributing to it immediately. You'll fund this with money that's already been taxed as part of your paycheck, but money in a Roth IRA withdrawn later is tax-free. Ask your HR rep if you can do automatic deductions from your paycheck so that you never see (and are tempted to spend) that money.
6. Be aggressive with your investments, with 90% of your funds in diversified stocks.
7. Create an Emergency Fund so you don't bury yourself in debt if your car dies, your roommate comes up short on rent, or you suffer some other financial mishap. Ideally, you'll stash three months' living expenses, but the important goal is to save something. Again, automatic transfers (preferably to an interest-bearing account like ING) are great for this.
8. Eliminate your bad debt. Get any credit card debt you have on the lowest APR card you can, & then pay off the one with the highest rate first using the “Snowball Method.” Student loans are not considered “bad debt” & have some of the lowest interest rates around, so don’t pay them off early, but do make sure to pay them on-time: a late SL payment will ruin your credit.
9. As tempting as it may be, do not run out and buy a brand new car. A car depreciates the minute you drive it off the lot and unless you pay cash for it, the monthly payments will count against you when you go to buy a house. Real estate appreciates on average 6% a year & is one of the best investments you can make. The in-town Atlanta market has seen appreciation of 12-18% a year in the last 5 years. If your current car is still running, hold onto it for a little bit longer until you figure out the other variables of the Real World.
10. Health Insurance is not optional! If you don’t have benefits, look into an accident/injury only plan you can get privately. Blue Cross/Blue Shield has a good one.
11. Just because you want it and you can afford it right then (or charge it), doesn’t mean you should have it! Before you buy any unnecessary item (like those cute Steve Madden shoes you have been eyeing), ask yourself “Can I pay cash for this?” and “If I buy this now, how does it affect my long term goal of _____ (paying off debt, buying a house, taking a vacation, etc.) If you cannot pay cash for something, do not buy it! Save up the money for it instead, and by the time you have the money saved, who knows, you may not even want the item anymore!
12. Credit cards are evil. Albeit sometimes a necessary evil.

Credit Myths

Myth 1: You only have one credit score. In truth, you have three credit scores, one from each of the three major credit bureaus. These scores can vary by as much as 50 points or more, which is why it's a good idea to check all three.

Myth 2: Checking your own credit will lower your score. You can check your own score as many times as you want without impacting your score but make sure you do so via the bureaus or a legitimate score seller like MyFICO.com rather than, say, at a car dealership.

Myth 3: Your age, income and sex are factored into your score. None of this information has any bearing on your score. Your employment is something that is listed on the credit bureau report but doesn't affect the score itself.

Myth 4: A higher salary will boost your score. Paying off your debts will improve your score. Earning more money, winning the lottery, or inheriting a fortune, however, will not because, again, your net worth and income are not factored into your score.

Myth 5: To remove unfavorable info just dispute it. If there is information in your report that is legitimately inaccurate, you should by all means dispute it. Credit agencies are obligated to investigate credit inaccuracies within 30 days or remove disputed information. But don't fall for so-called credit repair companies promising to remove unfavorable (though accurate) information from your credit reports to "instantly" improve your score. These days credit agencies not only investigate disputes quickly, they know a sham when they see it.

Myth 6: Shopping around for a loan hurts your score. When you apply for a loan or get pre-approved the creditor checks your credit report, which shows up as an inquiry to your credit. While it's true that too many inquiries to your credit will lower your score, you absolutely can shop around for a mortgage, home equity loan, or car loan without worrying about damaging your credit. As long as the same kinds of inquiries are made within 14 days of each other, they count as one inquiry on your credit score. Take note: This grace period doesn't apply to credit cards.

Myth 7: Credit card offers are hurting your score. Credit card solicitations, while annoying, don't affect your score. That's assuming you don't respond to the solicitations & use all of the credit that's available to you. There is no magic number for how many credit cards are too many, but if ratio of credit used to credit available is high, that indicates higher risk. Clearly consumers want to keep balances below the available credit line.

Myth 8: When you get married your credit scores are merged. People think once you're married your credit information gets mixed. But, your good or bad credit is yours and yours only 'til death do you part. When you open accounts jointly, though, that information will be reflected on each of your credit reports, for better or for worse.

Things to know before you buy!

1. Get a Realtor. Buying a home is the single largest purchase most of us will ever make, and it can be a complicated and intimidating process. A real estate agent has years of experience & training, and she can help guide you through the process, lead you to informed decisions, and look out for your best interests. As a buyer, an agent costs you nothing, but not having one can cost you quite a bit. Beware of contacting the listing agent on a house you are interested in – that agent will gladly show you the property but is, by law, always representing the seller and their best interest, NOT yours.
2. Get pre-qualified. Your first step after finding a real estate agent you trust is to speak with a loan officer and get pre-qualified for a mortgage. This is where the excellent credit you have been building will come into play. The lender will tell you what type of loans you qualify for and how much house you can afford so that you and your agent know what price range to be looking in. Be aware that you will often qualify for more house than you can actually reasonably afford, which is why it is important to have a good budget in place so you know what size monthly payment you are comfortable with.
3. There is no perfect house. Make a list of the things you want in a house and then prioritize them. No house is going to have every single item you want, so you need to decide what the true Must Haves are that you will not compromise on. Often this list changes as you start to actually go out and look at houses, and a good Realtor will help you define & focus your list as you go.
4. Be realistic. While we all may want a 4 bedroom, 3 bath home in Virginia Highlands with a full finished basement and big yard, chances are that is out of the price range of a first-time buyer. Most people own their first home for 3-5 years, so this first home doesn’t need to necessarily meet your long-term goals of being able to have all the potential future kids & grandkids home for the holidays, or including a custom, state-of-the-art home theater room in the basement.
5. Keep an open mind. There are probably dozens (if not hundreds) of neighborhoods in the Atlanta area that you don’t even know exist but which may meet your needs perfectly. And although you may have always dreamt of that cute little bungalow, you may find that the nice ranch down the street actually fits your criteria even better.
6. Take your time, but act quickly once you make a decision. This is the largest purchase you have ever made. Take the time to look at all the options & carefully consider every point. But once you have found something that fits your needs & that you like, time is of the essence. There is nothing as disappointing as having your dream house go under contract to someone else while you took a few more days to think it over. If your agent tells you this is the best option on the market for what you are looking for, believe them.
7. Location, Location, Location! This is a cliché because it is true. The one variable you cannot change in a home once you buy it is the location. Everything else can be altered. An outdated kitchen should not be a deal breaker, but being situated on a busy 4-lane road probably should. Nothing affects the value of a property more than its location, so consider this carefully and look to your real estate agent to provide guidance on this as it pertains to both your quality of life and your future investment.
8. What’s here today may not be available tomorrow. Oftentimes people wait to buy in order to save up more money towards a down payment (or for a myriad of other reasons), but by the time they feel ready, the houses they were looking at are now out of their price range due to increased property values. You certainly don’t want to rush into anything, but you also don’t want to miss a good opportunity. Talk through any fears or concerns you have with your Realtor…a good one will let you know if it is better to move forward now or wait it out. Every situation is different.
9. Speaking of down payments, you don’t necessarily have to have one! When our parents bought their homes, they were required to put down a 20% down payment. This is no longer true and in many cases you would not have to put any money down at all, which is why it is smarter to use that money to pay down bad debt rather than save for a down payment. However, keep in mind that the larger a down payment you choose to make, the greater amount of equity you have from the outset.

To Buy or Not To Buy, THAT is the question!

It’s a tough and sometimes scary decision, but the research shows that buying is the better choice in most cases. The Federal Reserve’s Survey of Consumer Finances has consistently found a huge gap between the wealth piled up by homeowners and that accumulated by renters. Home ownership builds wealth in two ways: through the forced savings of paying down a mortgage, and through appreciation -- the rise in the home’s value over time. The earlier you get in the game, the quicker you can get that appreciation working for you. The longer you wait - well - the consequences can be stiff. Most experts agree that if you plan to live in the same area for three years, it makes financial sense to buy if at all possible.

BUYING: THE PROS

• You build equity. Instead of paying someone else’s mortgage each month, pay your own and put your money to work for you. By making roughly the same payment as you would if you were renting, when you decide to move you actually re-coup much of what you paid.
• You get tax benefits. All of your interest and property taxes are tax deductible at the end of the year, none of your rent payment is.
• It’s a great investment. Property values are increasing 6% a year nationally, and the in-town Atlanta market has seen an appreciation of 12-18% annually in the past 5 years. That’s a better rate of return than the stock market.
• Freedom. No one can tell you what to paint it or how to decorate it. The emotional reward of knowing you own your own home is huge.

BUYING: THE CONS

• Cost. Typically in Atlanta it is slightly more expensive to buy vs. rent, although not always. In some markets (like CA or NYC) it is vastly more expensive to buy than rent.
• Maintenance. While you no longer have to ask permission to hang a picture on the wall, you also don’t have a landlord to call if something breaks.
• Commitment. Although you can buy and sell a home in less than two years if you need to move, it is not advisable and has some financial ramifications.

Want to know more? Check out this great AJC article written by columnist John Adams. He makes some interesting points!