Q: We are a young married couple making a combined income of about $65,000 and love to travel around the world. We do not have children. We spend thousands of dollars traveling each year on up to two different trips. We pay just $905 a month on rent living in Rogers Park, Illinois.

Paying rent enables us to travel. We really would love to own a condo in Chicago or Evanston, Illinois but there’s this enormous fear that we can’t afford it because of the high costs of a mortgage and the costs of our world traveling.

We don’t want to sacrifice years of not taking vacations for the sake of ownership, but we also do not want to live our lives renting. We consulted two mortgage people for loans and were pre-approved, as well as have talked to two real estate agents, but again we are afraid of giving up our priority of traveling.

Many people we know who own houses never travel because of their mortgage payments.

What do you suggest we do? We have thought of the zero down payment loans, but we are not sure if this is wise, since we heard it’s risky. What do you think about this based on our combined low income and travel expenses?

A: I think you sound like one smart cookie. You and your spouse have thought through what is most important to you – travel – and don’t want to do anything that would jeopardize the top priority in your life.

Very few people in this country – just about 1 percent – earn enough cash each year that they can spend it on anything they want. The rest of us have to be careful about what we do and make choices about how we use our resources.

I think it’s fine for you and your spouse to rent for the short run, because home prices are high and you would likely have to cut down on your travel somewhat. Also, it is relatively inexpensive to rent right now because so many people have bought homes and many landlords are desperate for renters.

At some point, this will begin to shift. Interest rates may rise and fewer people will be able to afford to buy a home. It may still be less expensive for you to rent.

But this is all short-term stuff. Down the road is the long run, and you will have to think about how you are going to fund your lifestyle after you and your spouse stop working. That may be 40 years down the road, but people are living a long time, and you may need to fund another 30 years in retirement from your savings.

By the time most Americans retire, they own a home free and clear and it makes up the majority of their net worth. Owning your own home allows you to live without paying rent each month (although you will have real estate taxes and the maintenance and upkeep of the property, not to mention insurance premiums.)

But hopefully you will also have an asset that is worth a lot of money. And, that’s why people sacrifice early in their lives — in order to have assets that will support them in retirement.

You and your spouse will have to sit down and decide how to prioritize your resources for the long run. You may decide to fully fund your 401(k) plans at work in addition to Roth IRAs out of your paycheck. And, that may be enough since your rent is cheap.

Down the line, if you decide to have children, everything will change again and you will have to reprioritize your paycheck. At that point, you may decide you need to move to a suburb that has great schools. And, you may decide the time is right to temporarily hang up your passport and buy a home. If and when you make the decision to buy, there are a variety of mortgage options – including a zero down loan – that may be right for you and will fit your income.

But for now, renting may be the smartest thing you can do. Just be sure to set aside enough cash in an emergency account so if life throws you one of its inevitable curve balls — you’re ready.

Oct. 17, 2005