Wealth Building starts with homeownership
By Xavier Thomas (Pierpoint, LLC)
Planning is often the most overlooked part of the home ownership process. Many of
us know that as long as we live we will need a place to call home. We are bombarded with slogans, catch phrases, jingles and
clever imagery to get our attention to become homeowners. Planning to become a homeowner or building wealth through home ownership
is not as exciting as the day we move into our first home but it may dictate if we acquire the home and more importantly build
wealth by retaining it.
Planning can take place on
two very distinct levels. Informal planning takes place while children are young and still sitting at the dinner table in
a family setting. Talk about their dreams and yours dreams; discuss the cost associated with those goals, and the possible
career path that is required to obtain the desired outcomes.
Planning
can be an empowering event for young people and can help shape the economic future of your family. Imagine a dinnertime at
home and the children are to come to the table dressed in the manner of how they perceive themselves when they are adults.
Ask engaging questions such as "How much money do you earn a year?" "What is the name of your company?"
or "What did you invent?" Questions such as these stimulate a young mind to think a about goal setting and achievement.
Educational goals and benchmarks should be linked with planning
through questions and examples. One example would be to allow the goal setter to review a document they will encounter in
their adult life. Reading a mortgage when you are young would help you avoid certain pitfalls when you are an adult, because
it would not be the first time you have had contact with the document. Ask the junior goal setter to explain in their own
words what they have read and provide them with assistance to get the answers to the questions they will have.
Formal planning and goal setting is more requiring. Goals now have a specific beginning
and end date. The plan now states a specific desired result and the means must be flexible enough to encounter life's unexpected
events. The senior goal setter knows what the value of the home they want, the senior goal setter knows the amount of savings
that is required to acquire the property and has been saving while they were in the junior goal setter stage of their lives.
The senior goal setter learned what income would be necessary to live in a home of particular value and governed their educational
behavior and activities toward achieving those benchmarks.
The goal
achiever stage includes a team of trusted attorneys, realtors, mortgage originators and non-profit housing counselors who
can communicate updated information that may prove useful during the process.
