Why else would they invest in a business? They consider their business an asset, right? Likewise, most people think of the purchase of a house as an investment, and see their home as an asset. Most business owners have a desire to save money and build wealth. RELATED CONTENT: Why Your Lifetime Savings Rate Matters. So, how much should you pay for your home? Well, let’s first look at what you can afford. With so many people that will be buying homes in the next few years, this becomes a very pertinent issue. Likewise, 29% of homebuyers say that they feel less financially secure than they did before they purchased their home. However, people with larger incomes tend to also buy larger houses. I know that you’re probably thinking, “Uh, Justin, that would be my income level.” To a point, that is correct. You know, one of the largest determining factors of your savings rate is your home.
In his book Stop Acting Rich, Stanley says, “Nothing has a greater impact on your wealth and your consumption than your choice of house and neighborhood.” He goes on to say, “If you live in a high-priced home in an exclusive community, you will spend more than you should, and your ability to save and build wealth will be compromised…” Ultimately, the answer to “How much should a business owner pay for a house?” boils down to the question, “What do you want to accomplish in life?” To answer their question, I quote famed American author and business theorist, Dr. Whenever I work with business owners, they often ask me, “Justin, how big of a house should I buy?” In other words, they’re asking me how much money they should pay for a house. Personal Budget Template – Excel Spreadsheet.Personal Finance for Business Owner Podcast Index.
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