I Inherited $200,000 – Can I Buy a House Without a Mortgage on My Low-Paying Job?

If someone asks you when the right time to buy a house is, the answer could be anytime. It’s an unfortunate reality that trying to predict the best time to buy is downright impossible. The right time for you might not be the right time for me, and we both still have to contend with market conditions affecting pricing. 

For one Redditor posting in r/personalfinance, deciding whether to buy a home is really weighing on them. Having graduated a few years ago from school, they saw life playing out a little differently. Instead, having inherited some money, they are now really considering buying a home. 

The Money Question 

Going back in time a few years, this Redditor graduated from school in 2020 with a degree in engineering. Unfortunately, they entered a challenging job market and were unable to secure a full-time role. This led them to take a job in a grocery store in 2021, a position they have held ever since. 

School and job concerns aside, they also inherited $200,000 from their grandfather after he passed away. Not only did this give him some financial freedom, but it also gave them hope that they could finally buy their own home. This is something that is top of mind, considering he is still living with his mother. After passing on a chance to move out in 2022, he now wants to use this inheritance to buy a home without a mortgage. 

The good news is that his current net worth is approximately $330,000, indicating he has invested and saved wisely. With houses in his area for as low as $300,000, there is a belief that he can afford the home and is seriously considering making a purchase. 

Don’t Ignore Other Costs

If we’re being completely honest with this Redditor, using this money to buy a home is a terrible idea. They are completely overlooking all of the costs and expenses that go beyond just having a mortgage. Owning a home also involves regular maintenance, insurance, property taxes, and other expenses that can quickly add up. 

What happens if an air conditioner breaks or a new roof is needed? Depending on the final price of the home, closing costs, commissions, and other expenses, there should be a net worth that cannot sustain the costs of owning property. While there may be some first-time homebuyer programs to consider, it still seems that there is a strong argument against this idea altogether. 

If anything, they should use this money to supplement rent somewhere, and only if they want or need to get out of their mom’s house. There is no question that rent might feel like throwing away money, but it would also teach some important financial responsibility about being on your own. 

Yes, there is a chance they can find a fixer-upper and purchase something for less than $300,000, but these homes often come with their own set of challenges. What if a contractor finds something an inspector did not? There goes more money, and it likely gets worse from there. 

Focus On the Job

If the Redditor truly wants to get moving in life, the first thing they need to do is improve their job situation. It’s difficult to determine from the information provided what happened regarding the lack of job opportunities, but this should be the primary focus. 

An engineering degree has lots of income potential throughout this Redditor’s life, as the comment section of this post frequently points out. Ignoring this and overstaying in a lower-paying grocery role feels like this Redditor needs to start with doing some soul-searching. 

Currently, the best course of action is for him to stay with his mom until he finds a job that pays well and offers greater financial stability. After this happens, the conversation can then turn to whether you consider renting for a while or think about buying something again.

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