Is Buying a Springfield MO Home Better than Contributing to a 401(k)?

Some young people starting careers wonder if it’s better to invest in a 401(k) or to buy a home. Fortunately, it’s possible to budget for retirement savings as well as a monthly mortgage payment. In some cases, people take out a 401(k) loan or use money they contributed to a Roth IRA to buy a first home. According to a recent piece by, some first-time home buyers contemplate whether it’s better to contribute to a company-sponsored retirement plan or buy a home.

For those house hunting in Springfield, MO, it’s a great time to buy. Owning a home is a major step toward financial security. Experts point out a home you live is a partial financial asset and a shelter. Consider whether buying a home in Springfield MO is a positive or negative.

Forcing people to save

A home is a forced savings account for people who have a difficult time committing to saving or investing. If you have access to a 401(k), consider asking your company to automatically deduct 10 percent of your paycheck. When finding a home, work with the rest of your money. Financial gurus suggest a monthly house payment that is not more than 28 percent of your gross income each month.

Finding a turnkey property

While it’s tempting to buy a home to renovate, consider the costs of making home improvements. In some cases, it’s better to ask your Springfield MO real estate agent to find a turnkey or move-in ready Springfield home. As long as you aren’t tied to certain kinds of floors or a particular wood for cabinets, you can save money by going with what the previous owner picked.

Keeping emotions in check

When it comes to investing in stocks, it’s imperative to stay rational. On the other hand, you want some emotional investment in a home. A good Realtor helps you sort out the practical and emotional issues on home buying.

Experts say the reason buying a home often surpasses the investing is because you lock in your housing costs. Homes tend to appreciate, although it’s not guaranteed. Also, most people reap the tax benefits of owning a home. The longer you make payments on your home, the closer you get to owning it outright and enjoying home equity.

At Realty Executives by Realty Choice, we help potential buyers become satisfied homeowners. Talk to us about touring homes for sale and finding out how much house you can afford. For more information on home ownership in Springfield MO, contact us.


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