Minneapolis, Minnesota (PRWEB) May 30, 2013
FINRA Investor Education Foundation released the State-by-State Financial Capability Survey which includes rich data illuminating how U.S citizens make ends meet, plan ahead to purchase a home they want, and manage financial decisions. Minnesota home buyers financial capabilities to buy a home prove to be stronger than the national average in most categories.
"Sometimes real estate buyers find that trade-offs must be be made between buying in a desired neighborhood, buying the ideal home, and what they can afford. Challenging decisions when trying to buy a home and gain a quality loan, often remind home loan applicants of just how glad they are for every dollar they learned to save,: says Jenna Thuening, owner of Home Destination.
The Consumer Financial Protection Bureau, including comments by Richard Cordray at FINRA Investor Education Conference in Washington, D.C., May 29, 2013 spoke on teaching children to learn virtues of saving earlier in life.
First, we recommend that financial education should start early and be continuous. When we do not teach children about personal finance – about managing household budgets, saving for the future, or making informed decisions about larger investments in an education or a home – we are failing them in a shameful and costly way.
"We also need integrated curricula in our schools," said Cordray believing that more can be done to teach individuals how to set money aside. Standardized tests could easily be re-framed to include more financial learning content. One example given was including a passage for testing reading comprehension that included topics like tips on saving money, developing good credit to buy a home, or the ability to obtain educational loans.
U.S. CITIZENS FALL INTO ONE OF THREE CATEGORIES OF FINANCIAL CAPABILITY
1) Individuals who report spending more than their household income (not including the purchase of a new home, car or other big investment) aren't saving.
2) Individuals whose spending equals their income are breaking even.
3) Citizens who spend less than their household income and are thereby able to save and make purchases.
"The summary is clear: Individuals who are not balancing monthly income and expenses may find themselves struggling to make ends meet and may later find they are unable to buy a home," concludes Thuening. "On the other hand,rewards of saving to buy a home, leave homeowners grateful for their practice of spending less than their income."
HOW MINNESOTA RANKS FOR FINANCIAL CAPABILITIES
Nationally, fewer than half, or 41 percent, of Americans surveyed reported spending less than their income. In Minnesota the number were slightly better at 39 percent. Nationally, over half of Americans, or 56 percent, have not set aside savings to use if they had to cover three months of unanticipated financial emergencies. Forty percent have set aside saving, where as Minnesotans ranked slightly better than the national average again at 42 percent who have set money aside.
Trulia posted an article by Real Estate Agent Michael Seaton titled "How Much Do you have to save to buy a home?" on March 7, 2013. After researching climbing rental prices against the opportunity to buy a home at low monthly mortgage rates, and adding on homeowners tax breaks, Seaton finds that many residents opt to become home buyers.
Seaton concluded, "After our housing turn around, more families are deciding to purchase a house as an investment. I believe that all homeowners should have enough cash after putting a down payment on a home, to be able to pay closing costs, and have enough money to make mortgage payments for 8 months. This gives you the security if something were to happen. Think of this savings as your cushion “just in case” money". Saving to buy a home in the future, setting target goals, and choosing a skilled Realtor is a great way to begin on the upward path of positive financial capability.
Home Destination offers home buyer and seller resources to empower families to make wise purchasing decisions. If you are are Minneapolis real estate seller or buyer and are seeking a seasoned guide, call 612-396-7832.