‘My family thinks we are moving too soon and we’re too impulsive’: After living in our current home for only 1.5 years, is it too early to upgrade to a new one?

Hi Money Minder,

I’m Dave and I need some advice. My wife and I are both 29 years old. I bring in about $160k a year with a $30k bonus, while my wife makes $134k a year. We bought a $560k home a year and a half ago, thinking we’d stay there for 3-5 years. Our mortgage is $4500 a month, which we can comfortably handle.

Right now, we have around $100k in equity in our current home, $50k in liquid savings, and about $200k in the market. There’s a $700k house nearby that just hit the market. It has more bedrooms, more bathrooms, more land, and it’s right by a lake. The catch is we still have a $30k car loan, but no other debt or student loans.

My family is convinced that we’re being too impulsive and moving too soon. What do you think? Is it too early for us to make the move to a new house?

Thanks for your help,
Dave

Response from THE MONEY MINDER:

Hello There,

Congratulations on the success you and your wife have achieved at such a young age. It’s clear that you have a solid financial foundation given your income, savings, and investments. Regarding your potential move to a new house, the decision ultimately comes down to personal priorities and goals. While your family may have valid concerns about moving too soon, it’s essential to consider what will bring you the most happiness and fulfillment in the long term.

From a financial perspective, upgrading to a larger, more comfortable home with additional amenities may be appealing, especially if it aligns with your future plans. However, before making any decisions, it’s crucial to evaluate the financial implications of such a move. Take a close look at your budget, current mortgage terms, potential costs associated with selling your current home, and the affordability of the new property. Being mindful of your current debts, like the car loan, is also essential in determining the overall financial impact of the move.

One practical approach could be to create a comprehensive financial plan that considers not only the immediate costs of moving but also the long-term financial goals you have as a couple. Factor in potential changes in income, expenses, and savings targets to ensure that the new house fits comfortably within your financial framework. Additionally, speaking with a financial advisor or real estate expert can provide valuable insights and guidance in making an informed decision that aligns with your aspirations.

In the end, the choice to move into a new house boils down to what will bring you both joy and contentment in your living situation. While listening to the input of your family is valuable, trust in your financial acumen and personal preferences to determine if now is the right time for this transition. With proper planning and consideration, you can create a harmonious balance between your financial stability and lifestyle aspirations.

Farewell from THE MONEY MINDER.