As for the investing in local real estate, how did he manage to have the money to do this? I think that many people straight out of high school wouldn't be able to get a loan for housing, so was this with his parent's money or money that he'd saved up over the years?
As for the housing. its actually quite ridiculous and after looking I don't know why I didn't do it sooner... If I had known I would have bought into real estate right out of high school. (I had a friend who did this, he now rents his condo that he owns out to people and uses the rental income to pay for his house he now lives in. He's 24 right now)
at the age of 18 when graduating High School I had about 14,000 saved up in my savings. Going back into county tax appraisals (so this is slightly off) i could have bought a townhouse for 50k.
Down payment of 12k would bring it down to 38k in loans. in the summer of 03 interest rates were slightly higher than now. about 5% or so for a 30 year FRM.
Property tax looks to be about 2.2%
plug that into the mortgage calculator and you now have a mortgage payment of wait.... 295.66 a month.
Pretty sure my first apartment I moved into and lived in for 2 years was costing me 260 a month with a roommate Plus power and internet which was right around 300 all said and done.
So you've now bought this place. Get a roommate, he pays the same as the mortgage, you now have your utilities paid and your housing insurance covered.
Don't have as much as I did for a down payment?? Follow the link!
http://www.grandforkshousingauthority.org/downloads/GFHA_UrbanDev_Broch_2k9_2WEB.pdfYou can buy an entry level condo for 60k in this town now. which is indeed high for the state average still. the 50k in 03 is quite a lot actually also. But in those 7 years since then the value has increased by 10k, so I would have had some awesome equity for a 25 year old.
The only thing that would be slightly hard is getting approved for normal financing. But heck I had that by the time I was 19. That's something that isn't taught properly though to the younger crowd.
1. get your own cell phone, in your name. your parents aren't doing you any favors keeping this in their name. If they really wanted to help you they would do that. and then if they wanted to pay it for you so be it. Staying on a family plan is silly in my opinion.
2. Get your own insurance!! For the love of god I can't tell you how many of my friends have been stupid and NEVER got renters insurance!! It costs like 9 bucks a month for 20k in coverage! I have had 2 friends live in apartments that had fire and all their stuff was smoke damaged and ruined... were they paying 9 bucks a month? Nope. GO GET INSURANCE!!
3. Get a student loan, seriously it does help.
4. (this required my parents) Going to buy that laptop for college?? Do what I did. I had the money but buying out right would not do anything for my credit at 18. I am lucky enough to have parents that understand the importance of building my credit. I took out an unsecured loan for a 1000 dollar laptop. I ended up paying an extra 90 bucks or something and I had to get my mom to co-sign (Hence the parent requirements) But I gave my mom the money when we signed the loan, and once a month for 6 months I made payments from the money my mom transferred to me from what I gave her.
All this was from direction of my aunt, who was the director of Ops for a credit union for over 30 years.
The other question I wonder for the average 18/19 year old is : Do you know your credit score/s?? I do. and I track them every year.
When i stopped going to school and I wanted a pickup at the age of 20 I walked into my credit union at 9am. and left at 9:45 with a check to buy the pickup of my dreams. One of the best and dumbest things I did. (don't buy without down payments, they really do help. I learned a hell of a lot from that purchase)
Starting to build your credit after you're out of college is too late, and that is a poor investment in yourself. I'm looking to buy a house due to an inheritance. I have co-workers who are twice my age that can't even get a loan because they have no history! Always paying cash is not always a good thing.
Then again I have friends that have masters degree's and they can't get a used car loan without a co-signer at the age of 25??
Sorry for the long post. I just thought I'd share some experience as I REALLY wish I would have known all of the housing stuff 8 years ago so i could have been planning for that...