-
-
Ad Space
(728 x 90)
WHAT THE EXPERTS SAY
Dunleavey declares that Mark and Jenn are wise to rent right now. “The cost of buying is, in the short term, quite high, and without any savings, they simply can’t afford it anyway,” she notes. And Chatzky adds that housing prices in the city are still hovering in the stratosphere. So while Mark and Jenn are fine renting for the time being, they need to start amassing some savings, be it for an emergency fund or to cover an eventual down payment if they opt to buy.
Mark initially thought the family spent about $1,000 each month on necessities like food and utilities. Both Chatzky and Dunleavey countered that there seemed to be about $400 of unaccounted-for cash, which suggests that Jenn and Mark are spending more than they realize. “They need to figure out where this vanishing money is going,” says Chatzky. Are they double-paying for health care? Spending more on food than they think? Not taking advantage of a flex-ible spending account (FSA), which can cut a third of child-and health-care costs?
Even if the family decides to continue renting—and because of the recent real-estate frenzy, it sometimes makes more sense to remain a tenant—by trimming a bit each month from their discretionary spending, and setting up a Dependent Care FSA account (which alone could save the couple more than $1,500 a year), they can get some savings brewing.
NEXT »
