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On average this analysis makes sense but cash flow is also important to consider. If the thing you’re investing in to get 7% doesn’t make payments, or has a si
by egsmi 6y ago
On average this analysis makes sense but cash flow is also important to consider. If the thing you’re investing in to get 7% doesn’t make payments, or has a single bad year and doesn’t yield like it’s supposed to, you could be up the creek.
- arcticbull 6y agoIndeed, I was basing the 7% return on the S&P hence assuming liquidity in the investment. Liquidity matters and, yeah, YMMV. Still works if you invest in CDs instead but it’s not nearly as attractive.