Renting Vs. Owning When You Are Poor

One of the most important questions to ask yourself when considering where you want to live is whether you will rent or buy your home, apartment, or condo. Some places even have lease-to-own options so you should consider that as well.

When poor, it is almost always a good idea to rent rather than attempt to own. There are several reasons for this. For one, if you have poor credit, you will be unlikely to get a good interest rate on your mortgage. You will end up paying more per month than you can afford.

Another benefit to renting is the cost of upkeep and repairs. If your home's air conditioner or heater goes out, you may have to spend thousands of dollars on a new one. If you have no way to get that money, you may never be able to afford to replace it. Being unable to afford the constant repairs that a home needs can mean that you will lose your investment in the home and it will not be worth as much as you paid for it if it comes time to sell. If you rent, however, your landlord is responsible for replacing the item.

Owning a home also comes with a lot of other costs. You will need to spend more money on water bills for yard care. You are responsible for repairing any damage or wear to the home. Plumbing emergencies can become expensive. You also have to buy insurance and pay taxes at the end of each year. These things can sneak up on someone who is trying living paycheck to paycheck.

Owning a home makes relocation extremely difficult. If you need to switch jobs, you may be forced to try to find something in the area. Selling a home is difficult and tedious and very much a gamble. If you are unable to put a lot into it, you are unlikely to get even as much as you paid for it.

Renting, on the other hand, means that you can relocate easily at a moment's notice. If you need to switch jobs, move to be near family, or escape a natural disaster, you can move to a new place without worrying about paying for your old one.

So, if you are living on a tight budget, avoid buying your home. It could end up costing you a lot more than you bargained for and could cause years of trouble for your family. Renting carries a lot of perks, namely the fact that you hold no monetary responsibility for the property.