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<h1>Financial Planning for Renters</h1>
Owning a home isn't for everyone, despite the popular conception that owning a home is a better choice. The truth is that there are a number of reasons that could be keeping you as a renter - many of which are sound and financially-viable. However, it is important to look at those reasons carefully to ensure you are making the best financial decision possible for both your short-term and long-term financial goals.Buying vs. RentingAdvantages of Home Ownership: When you purchase a home, you begin to build equity, or value, in that property. This increases your net worth, and gives you an asset to draw funds from should you need to at a later date. Owning a home brings a sense of security, stability, and community to many families. You have the freedom to do as you wish with your property regarding landscape changes and d&#233;cor. You also have the ability to make changes as needed and as you see fit, and do not have to wait on a landlord to provide necessary maintenance.Considerations: Owning a home places significant responsibility on your shoulders. Several expenses accompany home ownership, among them property taxes, home and hazard insurance, utilities, and possible Home Owner Association (HOA) fees. You are also responsible for maintenance, loss of value to a home due to market changes, and any costs incurred by making changes to the property. Owning a home makes the process of moving more complicated and costly, thereby limiting your mobility. Should you not be able to make the payments on your home, you could also face the possibility of foreclosure, loss of your home, and loss of the equity you had built in your home.Advantages of Renting: Renters typically have little to no responsibility for the maintenance of the home, and are not financially responsible for large repairs, such as new roofs. Renting also allows for easier moves, since rental contracts and leases typically have a set term; once the term is done and the tenant wishes to move, he or she simply has to find a new place to live. Renting is often the best choice when dealing with a short-term living situation, because of the costs associated with buying and selling a home.Considerations: In most states, renters receive no tax benefits on the money they pay for housing, unlike homeowners. They also gain no equity from the payments they make each month. Renters are subject to increases in rent as determined by the homeowner, and face the possibility of eviction or termination of rental contract. It is also important to consider the cost of renter's insurance. A homeowner typically carries insurance, but renters must carry their own to insure their personal property.For many people, the equity they have in their home is their largest single asset. If you determine not to make an investment in a home, it is especially important to ensure you have appropriate retirement investments and other assets that will allow you to reach your long-term financial goals.Before you determine whether owning a home is right for you, it's best to discuss your options with a financial advisor. 

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About the Author
Questions? Email me at wesley@thewandwgroup.com and visit our website at <A href="http://www.thewandwgroup.com/">http://www.thewandwgroup.com</A> New Money Talk is a weekly article focusing on retirement, personal finance, and estate planning.
Comments and questions are welcome, but because of the volume of email, personal responses are not always possible.
 
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