(1) Do not think you will be able to purchase a home with only 5% down. You should not even be looking at homes, townhouses or condo units unless you have enough in the bank to be able to put 20% down.
(2) Do not live above your means by using credit cards to “fund” an extravagant lifestyle – so that when your credit cards all approach the limits you take out a home equity loan or refinance your mortgage to get money to pay down the card balances, and then promptly begin to build them up again – so that when your credit cards all approach the limits . . . you see what I mean.
(3) If you can get by with a $15,000 car do not refinance your mortgage to get the money to buy a $35,000 luxury model. And keep your car an additional year or so instead of getting a new one every three or four years.
(4) Do not assume that the already inflated value of your home will continue to rise ad infinitum so that you can continue to live like a king on the wages of a footman and still think that when you are ready to retire you will be able to sell the home, pay off your mortgages, and have cash left over to buy a retirement property.
The bottom line – use common sense in your financial life!
If only I had written this post, and lots of people had read it and taken it to heart, back when I first began to blog!