In this episode Michael CFP®, EA tackles one of the most emotional and confusing decisions in personal finance. Should you buy a home now with a higher interest rate or wait and hope for a lower rate later? Our listener is looking at a payment that could be 42% of their income today but if rates came down would be a smaller amount of their income.

We talk through how to think about this without the noise of social media predictions and without betting your future on something none of us can control.

Inside this episode we explore:

💭 Why 42% might feel tight depending on your lifestyle and income

💭 How the size of your income may change what percent of income your home may be

💭 The problem with planning your life around a forecast of three percent rates

💭 How mortgage rates connect to the federal funds rate

💭 Why the ultra low rates after the Great Recession were the exception not the rule

💭 What inflation and unemployment have to do with potential future rate cuts

💭 The impact of layoffs in tech and the race for artificial intelligence

💭 Why a higher rate today with a refinance option later can sometimes make sense

💭 How slower housing markets and price cuts may work in your favor

💭 Why assuming rates will drop soon can be dangerous for your long term plan

If you are wrestling with the buy now or wait question, this episode gives you a grounded way to make your decision with more confidence and less stress.

Chapters:

00:00 Can I Afford the Home?

01:41 Wait Until Rates Come Down?

02:57 How Could We See Interest Rates Come Down?

04:12 What Would Michael's Current Gameplan Look Like?

05:34 Potential Downside to This Strategy?

05:53 Wouldn't Assume Int. Rates Going to 3% Now

06:36 Interest Rate Cuts Potential Effect on Bond Market?

𝐖𝐡𝐲 𝐰𝐞'𝐫𝐞 𝐡𝐞𝐫𝐞?

We’re here to make retirement planning feel less intimidating by helping people think through their strategies and plans through clear relatable financial topics!

💬 Questions or Want to Connect?

🌐 𝐖𝐞𝐛𝐬𝐢𝐭𝐞: www.custerfinancialadvisors.com

📧 𝐄𝐦𝐚𝐢𝐥: custerfinancialadvisors@lpl.com

Disclosures:

Harborfront Financial Group is a Registered Investment Advisor registered with the Securities and Exchange Commission (SEC). Registration as an investment adviser does not imply a certain level of skill or training, and the content of this communication has not been approved or verified by the United States Securities and Exchange Commission or by any state securities authority.

The information contained in this material is intended to provide general information about Harborfront Financial Group and its services. It is not intended to offer investment advice. Investment advice will only be given after a client engages our services by executing the appropriate investment services agreement. Information regarding investment products and services are provided solely to read about our investment philosophy and our strategies. You should not rely on any information provided on our web site in making investment decisions.

Securities offered through LPL Financial, Member FINRA/SIPC. Investment advice offered through Harborfront Financial Group, a Registered Investment Advisor. Harborfront Financial Group and Custer Financial Advisors are separate entities from LPL Financial.

This is a hypothetical example and is not representative of any specific situation. Your results will vary. The hypothetical rates of return used do not reflect the deduction of fees and charges inherent to investing. All investing involves risk including loss of principal. No strategy assures success or protects against loss.