2 ms·
Anyone who owns a house can sell it, move into a rental, and reinvest the proceeds in the stock market. They’ll be better diversified and can expose themselves
by directevolve 2y ago
Anyone who owns a house can sell it, move into a rental, and reinvest the proceeds in the stock market. They’ll be better diversified and can expose themselves to a wider spectrum of risk/reward profiles.
If Americans are clinging to their house because they perceive it as a “store of wealth,” they are not thinking clearly about the full spectrum of their financial options.
- bob1029 2y agoYou're just trading one kind of risk for another. When you own real estate you have a lot more control over your cost of living. That said, I think it would be fair to distinguish proper ownership from paying a 30 year mortgage. There's really not much difference in economic terms between renting and 3 decades of structured payments once you factor in insurance, fees, etc. If you own real estate outright and it's homestead in a place like Texas, your total monthly burn rate could easily be <$1000. Why kill yourself with delusions of grandeur in the market? It's significantly easier to control your own consumption habits if you want to wind up with a net gain.
- greenie_beans 2y agolife is so easy. just plug numbers into a spreadsheet so the math will make rational decisions for you.