One of the biggest expenses in your life is going to be your home. A deposit is a large chunk of money that can take years to save up for. Even then, it’s not over yet and you still need to pay hundreds or even thousands every month to keep up with your mortgage. Buying a home outright in a single payment seems incredibly difficult. So how do people afford incredibly luxurious homes? What does it really take to be so wealthy? Is it all just luck, or is there some trick to it?
Unfortunately, there’s not really a trick to being able to afford an expensive home. Some people may have gotten lucky in life and ended up being born into wealth, but for most of us, grinding our way up to that level of wealth can take years of hard work and a sprinkle of good fortune. But what does it really take to be so wealthy? Is it all about managing your money, or are there personality traits and strategies that can help?
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What’s the deposit on a million-dollar home?
If you thought that a typical mortgage down payment was expensive then the equivalent for a million-dollar home will probably scare you.
Most mortgages have an upper limit of how much can be borrowed. The maximum that can be borrowed is usually around $700,000 in good circumstances. This means that to afford a million-dollar home, you’ll need to make a down payment of at least $300,000 in some areas. Most million-dollar homes will exceed that million-dollar threshold, and it’s unlikely that you’ll qualify for a loan that large unless you have an excellent credit score. In reality, your down payment is going to be much higher unless you can qualify for a jumbo loan with strict requirements.
But how do you afford it in the first place?
The path to being rich isn’t linear. There are multiple ways to achieve it, and it’s going to depend heavily on your circumstances, education, knowledge, and ultimately motivation.
Here are a few tips on how you can develop a millionaire mindset:
- Learn to focus on the things that you want. Don’t be timid when you want to achieve something. Do everything you can to learn about it and approach it with passion. When you wake up wanting to get things done, you’re halfway there already.
- Set goals that are achievable. It’s impossible to make progress if you don’t track how far you’ve come. Set yourself some achievable goals and work towards them before setting harder ones.
- Be frugal. Don’t just throw away your money. Make sure the money you spend is an investment in your life or in your wealth. Don’t just waste it away as soon as you have it.
- Be hungry for knowledge. The more you learn, the more skills you’ll have. Don’t be afraid to fail occasionally to learn from your mistakes.
Becoming a millionaire and affording a million-dollar home are two very different things, but it all starts with a successful-oriented mindset that drives you to do better.
This is a collaborative post.