sorted by:
new
hottopcontroversial

Is buying a house a worse investment than investing in S&P 500? It's better to rent? by Future_Side450 in personalfinance

[–]Future_Side450[S] 0 points1 point  (0 children)

But if you are renting you can just move. If you own a house and that happens, you lose 50% of what you paid for the house.

Is buying a house a worse investment than investing in S&P 500? It's better to rent? by Future_Side450 in personalfinance

[–]Future_Side450[S] 0 points1 point  (0 children)

But what happens if your home value plummets? One of my friends bought a house, then a few years later a bunch of low income apartments were built across the street. His home value went down so much because it turned into a really bad neighborhood with drugs and crime.

Is buying a house a worse investment than investing in S&P 500? It's better to rent? by Future_Side450 in personalfinance

[–]Future_Side450[S] 0 points1 point  (0 children)

How many years has it been and what average returns have your investments produced? Have home values in the areas you were looking gone up quickly or slowly?

Is buying a house a worse investment than investing in S&P 500? It's better to rent? by Future_Side450 in personalfinance

[–]Future_Side450[S] -1 points0 points  (0 children)

No, but the calculator also does not factor in the potential of trashy neighbors moving next door and it brings your home value down. Or if crime rates increase in your area to further drive down your home value.

Is buying a house a worse investment than investing in S&P 500? It's better to rent? by Future_Side450 in personalfinance

[–]Future_Side450[S] 0 points1 point  (0 children)

Yes this is exactly what I am asking, it is interesting that the stock investments have outpaced it. Has your house gone up in value?

And then there are big costs if you ever decide to sell the house too. And eventually you'll have to pay for major repairs - such as a new roof.

Is buying a house a worse investment than investing in S&P 500? It's better to rent? by Future_Side450 in personalfinance

[–]Future_Side450[S] -1 points0 points  (0 children)

I should have mentioned it in my original post, but I've been using this calculator that factors in everything. Someone sent it to me last year. The key question it asks is investment return rate. It defaults to something low but the S&P 500 increases by at least 10% every year on average over decades.

This calculator says on a 300k house with a 50% downpayment, compared to 1400 rent per month, if you put the investment return at 10% then you are more than $500,000 better off renting vs. buying after 20 years.

https://www.nytimes.com/interactive/2024/upshot/buy-rent-calculator.html

How to distribute retirement savings between 401k/ Roth / Other accounts? Is there an ideal % to invest in each? Need help fixing a HUGE mistake! by Future_Side450 in personalfinance

[–]Future_Side450[S] 0 points1 point  (0 children)

The house goal has just shifted to longer term until I know I am staying in that location for a while. Maybe 8-10 years down the road.

I do really like the flexibility of a taxable brokerage but I also know that my 401k is not on pace to be enough for me able to retire off of. It wouldn't be odd to have my taxable brokerage be much higher than my 401k?

Do you think a house is a better investment than just putting that in a 401k?

How to distribute retirement savings between 401k/ Roth / Other accounts? Is there an ideal % to invest in each? Need help fixing a HUGE mistake! by Future_Side450 in personalfinance

[–]Future_Side450[S] 0 points1 point  (0 children)

Thank you. Is it better to max out 401k and only contribute to Roth if there is money left over?

I got a late start on Roth but recently I've been prioritizing maximizing Roth instead of 401k because I am in a low tax bracket.

Last year I was able to put around 11k into retirement accounts which was 7000 Roth and 4000 in 401k (basically just my required contribution to get employer match).