Navigating the U.S. housing market can be confusing for anyone—let alone a first-time buyer.
Mortgage lender and personal finance expert Jennifer Beeston teaches young adults personal finance and home-buying tips for today’s expensive market.
Beeston, who is also the author of Brainhacked, spoke to Newsweek and revealed the key tips she’d give to her 24-year-old son, Jack.
For Gen Z, Beeston explained that building credit and saving are the priorities— which you can do at the same time.
“Having savings is critical to long-term financial health, it’s not just about buying a house,” she said. “It’s about if your car breaks down and it has to go in the shop, it’s about medical emergencies or having to evacuate for fires or hurricanes. Saving is critical because it gives you options and will help keep you out of debt.”
Building credit is essential for purchasing a home, particularly at a younger age. While there are some mortgage options available that don’t require a credit history, they typically come with higher interest rates and necessitate a rental history, which many individuals fresh out of college or high school may lack.
“My son has been working on building his credit since he was 18,” Beeston told Newsweek. “He has two credit cards [and] puts one thing on each credit card every month and pays it off.”
Beeston advises Gen Z to do the same: put a small charge on and pay it off. “His credit is in the high 700s just by implementing this very simple, bulletproof strategy,” Beeston added.
For those choosing between buying or renting, Beeston said it all depends on the housing market you’re living in.
If Jack got his first job in Lexington, South Carolina, Beeston would be advising him to buy quickly due to lower housing costs and rental potential.
However, a long-term investment is more suited to somewhere like New York. “I would advise that he buys only if he thinks he will be in that property for a minimum of five years,” she said. “New York is a higher-cost market that does not cash flow as easily as an investment property if he decides to move.”
A budget is key for Gen Z to save up for a down payment and manage their financial goals.
TikTok Shop and Instagram-targeted ads are easy money traps, so being hyper-aware of whether your purchases are helping you achieve your long-term goals will benefit you in the long term.
There are many financial apps to help with budgeting and saving. Beeston told Newsweek that Monarch is one her son uses.
“I advise setting the app up to make you review every single purchase—it’s eye-opening and can help curb spending because you won’t want to review a ton of transactions,” Beeston said. “The key to saving is to be radically honest about every single purchase you make.”
Above all, Beeston advised that you start considering where you want to live when you’re in college.
Start researching as a sophomore to help you guide your job applications later.
“If your goal is to move to North Carolina, start researching what jobs you could do in order to live in that town,” Beeston said. “When you are starting out, your life is a blank slate, so put meaning and thought into what your world will look like.”
The post 5 Tips a Mortgage Lender Gave Her Gen Z Son About Buying a Home appeared first on Newsweek.
