Many of my close friends own a home and have “smart” debt in the form of a mortgage. By the time we turn 40, this is fairly common. That wasn’t the case for me, though.
When I turned 40, I didn’t own my own home. In fact, it will take me a few more years to join that club. Now, I know what you’re thinking: “What a terrible situation to be in at 40 years old.” But I actually have no regrets about waiting until later in life to become a homeowner — and here’s why.
I won’t lie: I’ve had a lot of fun in my life. I’ve had amazing experiences traveling the world; fun but expensive hobbies, like photography; a number of failed businesses that I learned a lot from; and a busy social life. But, while I was having all this fun, my credit card debt was climbing and my long-term savings kept getting put off.
Up until my 40s, I was largely financially illiterate. I made many poor money decisions. I often put the “now” before the “later,” and my finances reflected that. All it took was one major life event — being laid off while pregnant — to cause my debt to spiral out of control. My credit card became a major money leak.
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So, having acknowledged all of that, I believe that if I’d had a mortgage back then, it would have been a financial disaster. I have no reason to believe that until my financial awakening in my 40s, a mortgage would have been treated with any respect. In fact, had I gotten a mortgage during that period of my life, I know that I would have:
- Bought at the top of my lending ability instead of starting low
- Paid the lowest possible down payment
- Chosen the longest possible repayment period in order to pay the lowest monthly payment
- Consolidated “dumb” debt onto the mortgage at some point, to “take advantage of” a lower interest rate
- Used any capital created to fund a new car, or a holiday
- Not tracked the total cost of the house (all repayments, repairs, renovations, etc.)
- Remortgaged when times got tough, further extending the repayment period
- Not funneled increases in income toward paying down the mortgage
In short, if I had a mortgage before my 40s, I would be wearing a millstone around my neck today.
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Many of my friends who have mortgages made good financial decisions. They increased their mortgage payments when their incomes increased, left the equity created alone and they made it their business to understand the total cost of their home and the impact of any decisions they made about it.
These are the behaviors I’m confident I will display in my 40s, now that I have a proper appreciation of my finances and can appreciate the impact of my own decisions. That is why I’m glad I waited to become a homeowner. Had I become one sooner, there’s no way I would have been successful.
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