Renting isn’t wasting your money (and here’s why!)

renting isn't wasting your money

Renting isn’t wasting your money (and here’s why!)

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I get so fed up hearing the comment that renting is a waste of money. Renting isn’t wasting your money. At least, not for all.

Whenever the topic of renting or owning comes up, I hear all the time about how renting is a waste of money. Why would someone choose to pay another person’s mortgage?

Well, I just laugh—sometimes internally, and sometimes to their face depending on who they are. You see, I don’t view renting as a waste of money. I don’t really plan on buying a house. Sure, it is a way to create generational wealth, but it’s not the only way. That topic is for another way.

Renting has a lot of benefits—benefits that I’ve made the most of throughout my time renting*. Here’s why I don’t view it as a waste of money.

Renting isn’t wasting your money when mortgages cost more

Where I am, getting a mortgage for the type of house I currently rent would be more expensive. With the rates and the cost of housing, I’d end up paying at least $1,000 more on the mortgage alone. That’s not factoring in the property taxes and the water that I would then have to pay. If I lived in an apartment, I’d then have to factor in the heat that would likely be included in my rent.

So, I spend less each month when I rent. I don’t have to worry about the rising interest rates either.

Now I am in a position where I don’t need to worry too much. I’m in a rent controlled building and it’s owned by a corporation. It’s a large, fairly new townhouse complex, so the chances of me being forced out is slim. That could happen, but even then, I’d be able to find rents for less than a mortgage elsewhere.

Why would I choose to spend more of my income on housing? That doesn’t make sense.

I get to move quickly and easily

When we moved internationally, we didn’t have to worry about a quick sale of our home. We could hand in our notice and just move.

Sure, we didn’t have the investment from the house to use in the move, but we didn’t want to buy immediately. We didn’t need to worry too much about big financial purchases. I already had a job that I was moving with us, and we had ways to make it work.

It is important to plan ahead!

But renting isn’t wasting your money if you don’t plan on staying somewhere for too long. The longest I’ve spent in one place is five years. And that’s now because my ex and I split and we’re both a little stuck in the city that we’re in. If that wasn’t the case, we’d likely have looked at somewhere else to move to.

I’m not a fan of being stuck in one place for too long.

MORE: You can only cut back on your budget so much

There are more expenses into ownership than you initially see

You know your mortgage is something to factor in. If you were lucky to land a low interest rate, you may have scored a good monthly payment. What happens when you’re up for a renewal and the interest rates are still high? Can you afford that jump? I know so many people who can’t.

Then there are the property taxes and any utility bills that would be included in your rent. My water is covered, but in an apartment building, my heating was also covered. So, that’s an extra expense.

Then there are other costs of ownership*. When you’re renting, you’re not responsible for appliances breaking down unless you damage it. The landlord needs to tackle that issue. If there is storm damage to your roof, you’re not responsible for that. The same applies to any windows that break in storms or even due to break-ins. As long as you weren’t negligent or didn’t do it wilfully, the damage isn’t your responsibility.

You’ll still want to get renter’s insurance, but you won’t need the full building insurance. There’s no need to worry about what happens if there are problems with the foundation of the house—at least, not in terms of fixing it.

What if your driveway needs repaving? What about the general maintenance to the house to keep your investment good? You don’t need to worry about any of this. Homeownership may not be for you right now. That means you’re not wasting your money by renting.

Renting isn’t wasting your money when you invest elsewhere

You don’t need to invest in property. Not everyone wants to do that. Plus, when you do invest in the housing market, you’re tying your money up in that property. What if you could invest elsewhere and have the money available to you when you need it?

I opt to invest elsewhere. I like my own investments. They are setting up the future for my kids. How they then use that money is up to them.

A lot of people get stuck on creating generational wealth. This is a way to get the next generation ahead, but will they even use it the way you intended so the next generation benefits? There’s no guarantee of that. Just look at how many people have wasted away the money that mom and dad left them.

If you do want to create generational wealth, the housing market isn’t necessarily the best way to do it. You’re assuming that all your children will agree on what happens to the house afterward. And you’re assuming that they’ll use their inheritance wisely. You can set them up in other ways, such as through trust funds if you really wanted. Or you could just teach them the power of investing so they are ready to be adults.

Renting isn’t wasting your money. It’s being smart until you want or can buy a house.

MORE: 5 budgeting myths holding you back from financial freedom

Do you view renting as a waste of money? What are you doing to create your own wealth? Share your thoughts in the comments below.

Alexandria Ingham is a professional writer. She predominately ghost-writes in various niches, including fitness, finance and technology Everything is fully researched and well-written. Under her own name, she writes in the technology, business, history and weight loss niches

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