Now (your 20s) is the time to kick start your dream of becoming a property mogul
Ahh, the joys of being young. Adults in their 20s are basically walking around with limitless untapped potential. I bet you’ve heard more than once that ‘now is the time’ to do literally anything you want – because being in your 20s is basically a joy ride of possibilities.
If you have plans of becoming a homeowner in the foreseeable future, there no such thing as too early to start. So really, the 20’s is exactly the time for you to invest in a property and here are the reasons why:
1. You have time to save up and leverage on compounding interest
This is the magic of being young. When you start saving toward buying a property in your 20s, you have the advantage of leveraging on compounding interest. The accumulated compounding interest on top of your principal sum could help you with your down payment when you are ready to take the plunge.
With the money you’ve accumulated, assuming that you can afford a property of about RM400,000 and that the value of that property grows by about 5% a year, after a decade, that property would be worth RM650,000. Your investment has grown by RM250,00 – that’s money you can now use as a down payment for a bigger, better property.
2. You can get creative with your investment
Ah, to be a young homeowner – the possibilities are aplenty. Now, owning a property in your 20s doesn’t necessarily mean you have to live in it immediately. Instead, owning a property is a great way to generate some passive income for yourself while you navigate your life.
You can rent out the property to long term renters or even turning it into an Airbnb for holidaymakers and tourists. All the while, you’ll be living in the comfort of your own family home surrounded by loved ones – and mum’s cooking!
3. Plenty of time to reaccumulate your KWSP account 2
One of the things you might have done to purchase a property is to make a withdrawal from your second KWSP account. If you wait to purchase a property later on in life and withdraw everything from that second account, you’ll end up with a measly sum when you eventually turn 50 and have unconditional access to that account.
When you do this in your 20s, you leave yourself plenty of time to accumulate the savings in that accounts so that when the time comes, you’ll have a decent amount saved up again for your needs. Time is your friend.
4. You can get a longer loan term
This one is pretty obvious but is worth a reminder – you are more likely to get a longer loan term when you are in your 20s. When purchasing a property in your 20s, you can easily get a 30-35 years tenure on your housing loan which means lower monthly repayments.
This is of course due to the fact that banks are less comfortable awarding long term loans to older people for fear that they won’t be able to repay the entire amount on time. As you get older, the risk of illnesses increase as well, so there’s a higher risk of you not being able to pay back the loan.
5. You’re still energetic to invest time in doing research
You’re still energetic enough to invest time in researching options. As mentioned before, a younger you means a more enthusiastic you. When you’re in your 20s, you have more patience to sift through various finance assistance schemes and programs out there to help you purchase a home.
Think about it, your 20s is all about figuring stuff out, so you’re already a pro at this. There’s plenty of options out there, so you’ll need the energy to be able to go through them and find one that best fits you. You can look up for schemes like #OnlyEcoWorld Help2Own which is essentially a financial assistance product.
Help2Own works like this: All that is required of you is to pay 5% and secure a 70% loan from a bank and EcoWorld will take care of the rest for you. It’s a useful scheme that can help you realise your dream of owning your dream home. This offer is available for a limited time only with terms and conditions applied.
You can begin your quest to search for the best financial assistance scheme by learning more about how this product can help you here. There is no time like the present.
READ: 6 Creative Ways for Malaysians to Own a Home
ALSO READ: 5 ways Malaysian Gen-Ys can make owning a home possible