Securing a mortgage plan is just the beginning of a long, costly journey. Sure, it can give you a roof over your head, a safe retreat, and a fun place to hang out with your family and friends. But you don't completely own that place until you fully pay it off, which can take 15 to 30 years.
In the years of making monthly payments, you'll certainly experience financial woes that may affect your ability to pay. Life is pretty unpredictable, so even if you have a stable job, there's no telling that your income stream will constantly remain stable.
Hence, increasing your income — without necessarily working more — is crucial when you're paying mortgage. Below are ways to do just that, and your options in case your financial problem is a sudden one.
1. Explore Passive Income Opportunities
If you're familiar with stocks, bonds, real estate and other types of investments, those earn you passive income, albeit slow and risky. But they can earn you a fortune if the economy's behavior is rather good.
But investing in those aren't the only ways to earn passive income. You can also invest in your skills or talents through blogging or making a Youtube channel.
Being an online content creator can earn you a hefty revenue that can keep rolling in even while you're asleep. But of course, the earnings don't come overnight. You need to be consistent in posting quality content, and improving them as needed. Once you gain a huge following, advertisers can reach out to you, allowing you to post sponsored content which is paid higher.
2. Don't Rush to Buy a New Car
If your city or town's public transport can take you to your destinations without major inconveniences, then you most probably don't need that car.
Buying a car is one of the most common financial mistakes people make. This isn't to say that you should never buy a car throughout your lifetime, but if you're still paying debts, it's not just advisable. It loses you money the moment you drive it off.
A wiser decision if you really need a car is to buy a used one. It's cheaper, depreciates less, and the registration fees are lower. That way, you can save more and pay off your mortgage easier.
What's more, you can also earn income from driving. Not as an Uber or Lyft driver, but as an advertising space. If you drive your car to work every day, you can paste ads on it, and get paid as high as $100 every month.
3. Refinance Your Mortgage
Refinancing is taking out a new loan with a lower interest rate so you can repay your existing mortgage. You can seek a favorable mortgage refinancing from a new lender, and have its terms more suitable for your situation.
You don't just avoid the possibility of foreclosure in refinancing, but you can also obtain cash that you can use for home improvements and to repay your other debts.
The process of refinancing is similar to applying for a mortgage. You'll also need to get in touch with a bank, credit union, or a mortgage broker. The requirements are also pretty much the same as with a mortgage, so expect a lot of paperwork.
The perks of refinancing include lower monthly payments, shorter loan term, faster equity-building, and consolidated debts. It allows you to maximize your income, and allot a good portion of it to other purposes like leisure.
With these strategies in your financial plans, you'll always have a solution to every money struggle. Remember to spend wisely as well, because your hard-earned money shouldn't go to emergencies only.