7 Net-worth killers

While it's never smart to be penny-wise and pound-foolish when making important investments like buying a new home, it's also never smart to think, "Oh, what's another hundred thousand dollars when I'm already spending more than I ever have?"

The answer is quite a lot and possibly more than you can handle.

Besides a higher mortgage payment, factor in the costs of homeownership, which grow with the value and size of the home: Property taxes, home insurance and energy costs, for starters, not to mention future maintenance costs.

As a general guideline, it's best not to spend more than 2-1/2 times your income on a home. Your total housing payments should not exceed 28% of your gross income. Total debt payments, meanwhile, should come in under 36%. That means payments on all loans, including your mortgage loan, school loans, auto loans and credit card debt.