I’m a college student who’s about to graduate. Once I get settled into a job, I plan to move out of my parents’ home (I graduate a year from now, and it will take at lease 6 months to find a job). Depending on the security of that job, I will likely move out with my eventual spouse and live as inexpensively as possible, while paying back student loans and trying to save money.
So far, I’d say I’m good at budgeting and living modestly. However, I know next to nothing about buying long-term investments, such as a home or a car. The only car I ever had was purchased with cash for $ 1500. It wasn’t the best investment, but it was all I could afford at the time. My family has always had bad credit (accrued from before I was old enough to even be aware), so I’ve never seen a credit card used by any of my family members. And my parents lost the only home they ever tried to own. The down-payment for it came from my mother’s inheritance; not to mention, the house was poorly researched, and they lost it due to my father whimsically quitting his job and overestimating his ability to find a new one. Alcoholism and domestic dysfunction added to the problems in that home. I was only a preteen then, and sure didn’t understand the mechanics of foreclosure.
So, as a young a person with little knowledge and advice from the people close to me, where can I gather realistic advice and research about home-buying? Ideally, I wish to live debt-free. But I don’t know if buying a home works like buying expensive furniture or a car, or if you HAVE to take out a mortgage. Can’t I set up some kind of financial instrument or savings that will allow me to save for a long time until I have enough for a down-payment, and then just make payments until my home is paid off? Or will I have to pay interest, as well as a principle, no matter what? I already have student loans to pay back, so I don’t want to keep accruing debt. Also, I want to own a home one day so that I have a place to live when I’m too old to work anymore. I just don’t know anything about buying a home, and I don’t want to make the same mistakes my parents made.
Please keep in mind that my goal is security for the future versus wealth-building.
Note: Is a mortgage my only option? I really don’t want to owe interest. I just want to make payments. Is that possible?