“We’ve got it all covered...unless our kids want to go to school”.

Hi Scott,

I’m completely stressed out. My husband and I are planning on building our new home, and we’re worried that we won’t have enough money when the build is over (let alone now!). Our land cost us $445k, and the house will be $280k. Our basic expenses will total $1,300 a week (which at this stage does not include our kid’s school costs of $5,000 a year). Hubby brings in $1,100 a week, I bring in $300. My question is this: should we bail now and sell the land, or wait until it is built?

Sandra

Hi Sandra,

A couple of obvious observations: you’ve got $100 a week left over, so long as the car doesn’t break down, the fridge doesn’t go on the blink, and... your kids don’t go to school. Seriously Sandra, your numbers are tighter than Clive Palmer's shirt buttons.

Having just built a home, I can almost guarantee you that it’ll cost more than you’re budgeting for. It’s an incredibly expensive, draining process. The bottom line is that if you’re stressed out now, just wait until you’re a few months into the build.

If I were in your situation I’d press ‘pause’, until you can increase your household income. You should only go into this with at least one month’s worth of living expenses -- call it $4,000 -- and a weekly buffer of $300 a week (preferably more). That means either you go full-time, or your husband picks up more work. It also means your kids go to a public school.What if you can’t do that? Simple. Sell the land and buy something you can afford. Bottom line, don’t sacrifice your family for a pile of bricks -- your kids will love you no matter what home you’re in.

Scott