I am 22 trying to buy a house while also saving enough for retirement. I'll list all the information below. I believe I make enough to own a house and contribute to my retirement but I'd like to see If you guys think I'm in a good position to own a house.
Information:
Work:
I make $40,000-$42,000 a year with an annual raise of 2% to 3%.
I make $2,300 per month after taxes, insurances, 401k.
Approximately $2,000 bonus per year.
Money Saved:
Currently have $31,000 saved between checking and savings.
Retirement Savings:
Currently contributing 10% of pre tax salary to 401k.
Currently contributing 6% of after tax salary to Roth IRA.
House:
The house I'm considering buying cost $95,000.
After a 20% down payment the loan would be $76,000.
Closing costs will be around $3,500.
Monthly mortgage amount will be close to $600 per month.
Monthly Cash after Taxes:
$2,300
Monthly Approximate Expenses: (Rounding up)
$600 - mortgage
$300 - electricity/gas
$200 - car gas
$100 - car insurance
$100 - trash/water
$80 - cable
$80 - internet
$200 - food
$100 - toilet paper, laundry detergent, stuff, etc
$100 - repairs/maintenance
$1,860 - total expenses
$540 - left over for entertainment, save more, unexpected expenses, etc
I've been living with my mom, step dad, and brother so I've been able to save $31,000 while still paying rent and other expenses. Am I in a good position to buy this house? And save enough for retirement? Should I rent an apartment? I'd like to move out soon.
Added (1). After buying the house I'll have about $7,000 in the bank.
Added (2). I plan to stay in the same location for a long time.
Added (3). jimbobsebring - I had already calculated the property taxes and home insurance in the monthly mortgage of $600. It comes out to:
$382 - principle and interest
$150 - property taxes
$68 - homeowners insurance
$600 - total mortgage
Added (4). My math was off. I'd have around $440 left after expenses not $540.
Added (5). Also forgot to include after tax Roth IRA of $200 per month which leaves me with $240 extra per month:/
But remember I'm rounding up on most of these expenses.
Read more: Am I in a position to buy a house?
