I’m going to spend a little less time advising and more time explaining in this post. I’m sure I won’t hide my opinions very well (mutual funds are bad and dangerous!), but I’d prefer you understand the two investment strategies instead of just knowing my stances on the issues.
Sometimes investing feels like an easy concept. Put money into stocks, private equity, valued commodities, then let those market-driven venues put your capital to work.
Whether you have lots of money or not very much, you’re buying a palace in your hometown or a condo in a new city, or you just decided you hate paying rent and you’re ready to own, you need to know some key facts. Buying a house involves a lot of moving parts, and each and every misstep can cost you lots of time and money. Worse yet, you could buy a house you don’t love and end up selling it at a loss, leaving you with less wealth and no home.
Before you form any opinions about this article, let me quickly state that I am 100% in favor of saving for retirement. I’m passionate about people growing their wealth and squeezing every bit of joy out of life, and having money set aside for after you’ve exited the workforce is a big part of that. By whatever means possible, you should be trying to maximize your retirement savings.
Real estate is an excellent investment, and it’s one you’ll hear me praise regularly. For those who have the money to invest, buying a vacation rental that brings in passive income makes for a savvy purchase. However, it takes a lot of calculating to know if you’re ready to make this type of investment. It’s possible you’ll crunch the numbers and realize you’re closer to buying than you originally thought. There’s also a chance you’ll discover it’s going to be a few more years before you’ll be able to invest.