Rent or Buy, Which is Better?

In my 16 years as a financial planner, I have been asked this question many times. For decades our society has told us that renting is just throwing your money away and that buying a house is a good investment. Even the government tries to influence our behavior with offering a tax deduction on the mortgage interest. We have to start realizing that your house is not an investment. Investments should be able to feed you income; and as I always say ‘You can’t eat your house’. So which is it, Rent or Buy? Let’s compare some facts. First with renting you don’t have maintenance costs, mortgage interest, property taxes and renter’s insurance is dramatically less expensive than homeowner’s insurance. If you average $1000/month in rent over 30 years, that’s a total of $360,000. Throw in another $15/mo for renter’s insurance and the total spent to rent for 30 years is $365,400. Now if you were to buy, say a ...

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You Lost $24 Billion In 16 Days Mr. Government?

According to the USA Today (10/18/2013), the 16 day Government shutdown cost the economy jobs, delayed mortgages, and lost retail sales.  The numbers aren’t fully in yet, but it is purported to be at least 12 billion dollars and possibly as much as 24 billion dollars for the stalemate that took place in Washington, D.C. over the past several weeks. As a 22 year veteran financial advisor, you don’t advise someone to take out a Target store card right after they have maxed out their Sears and Nordstrom store cards.   We all know that piling up lots and lots of credit card debt is simply an unsustainable way to manage a financial budget.  What we all don’t know today is when the balloon will burst. It’s not a smart money move to lose 12 billion, let alone 24 billion, but I’ve come up with my list of things that we could have done with 24 billion. We could have handed ...

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