As we wait for winter to end. many folks start thinking about buying a home vice renting and spending their hard earned money on their own home. As the idea percolates many things cross your mind, how much house can we buy. So you go to your bank website, find the mortgage page and plug in your data to get an idea of how much house you can buy. The magic number appears and the online search begins based on that number. You search for homes that are close to what the bank system says you can afford.
Well, that is one way of looking, whats the amount I can spend on a home. The better way is to figure out how much a month you can afford. This way you calculate your living costs such as food, fuel, electrical and taxes that are your everyday expenses. At this time calculate a savings plan into the mix as well as a holiday fund. By incorporating all of these costs plus your mortgage you will have a better idea of what you can afford and still have funds left to enjoy life. Spending to much to buy a larger house may leave you in a position where everything you make is supporting your day to day living and not allowing you to enjoy vacations or other moments that make life worth living.