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What is Your Locus of Control?

Housing news has recently devoted copy to the difficulties of Gen X (roughly ages 33-40) and Gen Y’s (25-33) ability to buy a home. The articles reference student debt and stagnant income as the major constraints. Add in tougher underwriting standards and you have 3 limiting externals to homeownership. I’ve written in the past that HGTV and Gen X and Y’s inability to deal with risk also play a role. The latter two are limiting internals that can be managed with information and education.

HGTV is easy to address. For Boomers, think Alice Cooper. For Gen X and Y think Lady Gaga. Each may be fun to watch but bear little resemblance to reality. Need I say more? What about risk? What about risk.

Take Risks: If you win, you will be happy. If you lose, you will be wise.

So, the issues of student debt and stagnant income remain. Let’s accept each as reality for this newsletter and make the assumption that when you purchase a home you will remain in it for 5+ years.

Gen X and Y can complain about their situation but that accomplishes little. It’s better to look at what can be done – not the limitations that make it difficult to get something done. Many potential home buyers, paralyzed by fear of failure or the inability to take risk – or a combination thereof, simply don’t take any action. That puts long-term wealth at risk.

My math says the longer you delay home ownership, the more it may negatively affect your financial future. If you are not saving (more on this in Part II) you are missing out on building equity. Missing out on 5-6+ years worth of equity has long-term consequences.

There is a personality psychology theory referred to as Locus of Control.

The short summary is: Locus of control refers to how you ascribe responsibility for the things that happen to you. If you have an internal locus of control, you believe that the quality of your life is largely determined by your own choices and actions.

If you have an external locus of control, you believe that the quality of your life is largely determined by your environment. You believe that others are responsible for who you are and what you are. I believe in a hybrid. It’s the Michael D. Holloway “let’s put the boots on and go to work theory.”

I am not making a political statement (it may read like one), rather a personal statement about how to improve your chances for having assets as you age. Getting answers about questions of debt, job stagnation, HGTV and home ownership are part of how you solve the riddle and create long term assets. I’ve already written 488 words so I’ll address all in Part II of my August newsletter.

P.S. I represent buyers only. I don’t list homes for sale – with one exception – if I personally own the home. Below is a link with information on a condominium which I own and am selling. If you know of anyone who may have an interest in a condominium on Milwaukee’s East Side please share this with them.


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Homebuyer Associates
1835 N. Riverwalk Way
Milwaukee, WI 53212
Phone: 414-254-4129