We have spent a lot of time on this blog talking about your house and how much to spend etc. Why? For most people, it’s your biggest expense …
Interestingly, I have no rules for your first home, other than not breaking the 25% Income Rule (this video talks about 28% … my rule is post-tax, but this video doesn’t specify whether it’s pre- or post-tax), so it may be worth listening to what this guy has to say.
However, once you are in your first home, in my opinion, you have “entered the race” and that’s when my 20% Equity Rule and 5% ‘other junk’ Rule kick in to help you ‘win’ the race to your Number by not over-investing either in your home or in your ‘other stuff’ (incl. cars).
Let me know what you think?