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Should I buy home or invest the money?
Hey everyone!
I found this forum on google while searching for some financial advice. Well, I need some advice about making myself financially strong & take the right decision about buying house/investing in properties/business at this point of life.
I am 25 year old, just married, living with my joint family. I have my business thats self-sufficient and I draw around $2000 as salary every month (which is enough to live a good life in a country like India where I live).
I have been living in a rental house for 3 years paying $300/month. The contract is expiring next month which means I need to find another place to live. When I searched new rental houses, its gonna cost me around $500 to get a good one now.
I did not have enough money to buy house 3 years ago and I used to think (still think) that buying a house and living yourself in it is so stupid. You can never use that money because you are always living in the house. Its hard to leave/move/switch houses. And it doesnt matter whether its worth even millions. But as the rental is going to be increased, I am forced to think why not take some more loan and buy own house and pay the rental + some more money to payoff the installments.
At the same time, the other mind says to take it as a business and better invest in small lands/plots, get around 40-50% annual roi each year(as you knw one can easily get in booming country like India) and payoff all expenses with that. And keep living on rental.
I have around $20K in assets in my business & I draw 2k as salary. So, I dont need to worry much about it.
Other than that, I have saved around $10K for emergency funds. And another $2K as general savings.
I have around $40K which I could use for either doing a downpayment for a house or invest in properties. This is all liquid.
Talking about the expenses, I am paying $600 a month for my car debt (just bought) for 7 years (debt around $28K). I am paying $300 as rental (gonna go up to $500 if I go for rental house next month). $1000 personal/family expenses. Overall around $1900-$2200/month. $22,800-$26,400 annually.
Case 1) Buying house:
Buying a new house would cost me around $120K minimum by paying $40K down and getting a loan of $80K (paying $750/month for 23 years)
Pros n cons:
a) I would have to payoff $750 each month as installment for loan for 23 years.
b) Cant sale/liquidate easily.
c) Have own house, no rental to pay.
d) Cant get any more loans for biz/personal needs.
e) Cant do much hustling.
f) Great relief feeling.
g) Ofcourse its net worth would also increase with time. But I would never be able to use it.
Case 2) Investing in property:
Investment in many small lands/plots (ex. around 5 plots of 1000sqft each) would cost me around $8K for each plot and when I sell them after 1 year, I can make 50% ROI and make around $20K on an investment of $40K. So, I can payoff 'almost' ALL my annual expenses with this investment and live a peaceful life if I do it every year.
Pros n cons:
a) I can get more loans to buy more properties and make more money.
b) Need to pay $600 rent/month which I'll never get back.
c) Don't have own house.
d) I can liquidate all my money anytime/ not much hassle.
e) I like freedom, don't like debts much which I would get.
f) I can think of starting new businesses by getting capital from either bank/savings from ROIs of these investments.
My question: What do you think I should really do? How can I invest smartly? If you have any suggestions other than properties, I would be open.
I thank you all for reading it patiently and responding in advance! Your enlightening thoughts & experience can make my life much more beautiful. Thanks again!
I found this forum on google while searching for some financial advice. Well, I need some advice about making myself financially strong & take the right decision about buying house/investing in properties/business at this point of life.
I am 25 year old, just married, living with my joint family. I have my business thats self-sufficient and I draw around $2000 as salary every month (which is enough to live a good life in a country like India where I live).
I have been living in a rental house for 3 years paying $300/month. The contract is expiring next month which means I need to find another place to live. When I searched new rental houses, its gonna cost me around $500 to get a good one now.
I did not have enough money to buy house 3 years ago and I used to think (still think) that buying a house and living yourself in it is so stupid. You can never use that money because you are always living in the house. Its hard to leave/move/switch houses. And it doesnt matter whether its worth even millions. But as the rental is going to be increased, I am forced to think why not take some more loan and buy own house and pay the rental + some more money to payoff the installments.
At the same time, the other mind says to take it as a business and better invest in small lands/plots, get around 40-50% annual roi each year(as you knw one can easily get in booming country like India) and payoff all expenses with that. And keep living on rental.
I have around $20K in assets in my business & I draw 2k as salary. So, I dont need to worry much about it.
Other than that, I have saved around $10K for emergency funds. And another $2K as general savings.
I have around $40K which I could use for either doing a downpayment for a house or invest in properties. This is all liquid.
Talking about the expenses, I am paying $600 a month for my car debt (just bought) for 7 years (debt around $28K). I am paying $300 as rental (gonna go up to $500 if I go for rental house next month). $1000 personal/family expenses. Overall around $1900-$2200/month. $22,800-$26,400 annually.
Case 1) Buying house:
Buying a new house would cost me around $120K minimum by paying $40K down and getting a loan of $80K (paying $750/month for 23 years)
Pros n cons:
a) I would have to payoff $750 each month as installment for loan for 23 years.
b) Cant sale/liquidate easily.
c) Have own house, no rental to pay.
d) Cant get any more loans for biz/personal needs.
e) Cant do much hustling.
f) Great relief feeling.
g) Ofcourse its net worth would also increase with time. But I would never be able to use it.
Case 2) Investing in property:
Investment in many small lands/plots (ex. around 5 plots of 1000sqft each) would cost me around $8K for each plot and when I sell them after 1 year, I can make 50% ROI and make around $20K on an investment of $40K. So, I can payoff 'almost' ALL my annual expenses with this investment and live a peaceful life if I do it every year.
Pros n cons:
a) I can get more loans to buy more properties and make more money.
b) Need to pay $600 rent/month which I'll never get back.
c) Don't have own house.
d) I can liquidate all my money anytime/ not much hassle.
e) I like freedom, don't like debts much which I would get.
f) I can think of starting new businesses by getting capital from either bank/savings from ROIs of these investments.
My question: What do you think I should really do? How can I invest smartly? If you have any suggestions other than properties, I would be open.
I thank you all for reading it patiently and responding in advance! Your enlightening thoughts & experience can make my life much more beautiful. Thanks again!
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