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Kids AND a Mortgage – Is it Possible? Solution Two: Buy Somewhere CheaperHave you thought of a Sea Change or a Country Change? There are a number of government grants available in different states to people considering moving out of the city to rural areas. By “rural” we mean…you can still live within a small city or even not too far away from the big smoke. So don’t freak out at the thought of re-locating to the distant outback.
Exhibit B – A couple with young kids moved to the Central Coast from Sydney. The dad was able to organise work locally and mum has a small business set up which she can do from home. Areas of the central coast are significantly cheaper than Sydney, which means they were in a position to purchase a home. But they’re still close to friends and family in Sydney where both Mum and Dad have lived all their lives.
Key Factors to Relocating Successfully
- Find out if you are eligible for any government grants (every little bit helps).
- Keep in mind how you will earn money when you re-locate.
- How far are you really willing to be from friends and family? Losing your support group could have alternative detrimental effects.
Pros
- Buying out of town is significantly cheaper.
- There’s less traffic out of the city…so you’ll spend less money on idle fuel.
Cons
- Finding work can be hard depending on what you do. Make sure you have this sorted before you commit to re-locating.
- Being away from your friends and family.
- If you decide to commute to the city for work, travel expenses can negate the savings.
Click below to read more suggestions for tips on how to afford both kids and a mortgage.
Kids and a Mortgage – Is it Possible? The Intro - read more
Buy something cheaper - read more
Buy something and rent it out for 6 – 12 months while you live with your parents - read more
Start a trend, don’t buy your kids everything - read more
Refinance - read more
Credit is the backbone of a redomn monetary system. Banks were created by the constitution as a great vehicle to have both capitalism and full employment. The private sector by itself cannot create full employment because of financial constraints and needs buffer for uncertainty and the government has to step in. Banks hold a unique position, else credit will be difficult and pricey. Banks have this unique ability to lend by expanding out its balance sheet. Preventing an easy expansion of the balance sheet will just increase the loan rates. The settlement balances at the Federal Reserve have just two roles settlement and help satisfy the household need for currency notes. The central bank is also the lender of the last resort and can lend as much as possible. The whole system is designed wonderfully so that entrepreneurs, academicians, scientists, engineers, artists, advertisers, sales persons, managers, HR, unskilled laborers can make use of this and increase the quality of life for themselves and others. If the households permanently decide to use more cash, the central bank can help banks slowly reach that state where they keep more settlement balances, lending in unlimited quantities in the meantime. Its a misunderstanding of the system and poor economics which led to the crisis. Economic advisors to governments have no concept of domestic private sector deficit in their analysis. If they had noticed that the private sector was getting weak, they would not have allowed a credit boom to have happened. Instead they supported the boom and ignored reports showing scams and forgeries. It is neither low interest rates or low reserve requirerments which caused this crisis. Blaming the crisis for these two things is like blaming the invention of fire instead of blaming the fire prevention system.