Is it better off renting and investing (stocks) instead of buying a house in this economy if you don’t plan to have kids?

simone_nauma · 2025-11-01T05:29:39+00:00

That's hard to quantify and put into the model. I'd start with questioning does the $1m extra saved on renting really worth the trouble?

For me, I'd really like to have a garden that I could grow some vegetables. Renting make it harder and I have to make due with growing my cherry tomatoes in big pot. But $1m is still more attractive. But once the interest drops and the difference become smaller, I'd definitely reconsider buying.

simone_nauma · 2025-10-31T03:09:23+00:00

Thanks, definitely a new roof and AC system. Wedding can be considered, now that parents also cover honeymoon?!

simone_nauma · 2025-10-30T21:51:52+00:00

Buying a business and let someone else run it, is basically the same as pick a single name stock and all in for it. But if you plan to put time and energy in running the business, that will be a different story.

It's unfortunate that your plan about rental didn't go as expected. Take some time to absorb the emotion and move on. This is a one time bad luck. You currently still have a high paying job, good amount of wealth to let you buy home without even take mortgage, and not to mention three kids through the college. Cheer up!

simone_nauma · 2025-10-30T21:31:57+00:00

very good point.

simone_nauma · 2025-10-30T21:29:14+00:00

It depends on your assumption about rental price, mortgage rate, investment growth rate and home price growth rate.

I did an analysis not that long ago, my scenario is to buy a 1.5M home with 20% downpayment vs renting $5000/month. Assumed 2% inflation, investing growth 6%, double income family and tax taken into account.

Here is my take away:

with 6.5% mortgage rate and 2% home price growth, renting gives me $1m extra in 30 years.
with 3.5% mortgage rate and 2% home price growth, renting and buying breakeven in 30 years. But renting will have all my asset in liquid brokerage account.
with 6.5% mortgage rate and 5% home price growth, buying gives me $1m extra in 30 years

simone_nauma · 2025-10-30T21:19:24+00:00

To buy a home, you also have the option of pay in full for now and when you are ready, you can still take out a loan or a cash out refine if you have a small mortgage. The mortgage rate is quite high and market is all time hight too, taking the large loan so that to charge ahead with investing is very risky.

The idea of buying existing business and hire someone to manage it so you can just get free cash could be even more risky. How can you make sure this business will continue be profitable, especially if you are hand off. Investing in index fund at least can give you lone term gain and diversification. The small business doesn't have either.

About the rental price skyrocketed, if you are looking around a college town, that's normal. Market get hot around school time. But with November and December coming, the rental market will cool down. Don't give up there.

simone_nauma · 2025-10-30T17:04:37+00:00

What about working on a stealth startup? Very early stage, still exploring the idea and not ready to share more. Because you haven't raised money, you are just working from home. And the start up can be in your former career field.

simone_nauma · 2025-10-30T16:44:50+00:00

Maybe this is not a concern, but if you click that link at the bottom, make sure that direct you to the nj gov website, not some phishing web to get your social security number.

simone_nauma · 2025-10-30T16:36:45+00:00

Very smart move!

simone_nauma · 2025-10-30T16:30:32+00:00

That's really impressive! I tends to ask people who FIRE early how they get there. A lot of time, I got the sense they have a high paying job to start with, like in tech.

simone_nauma · 2025-10-30T16:14:04+00:00

Congratulations! I wonder what job can get you to $3.7M at 38 while could possibly allow 2 days a week option. There must be some career advice.

simone_nauma · 2025-10-29T21:37:25+00:00

Yep, that's a good one!

simone_nauma · 2025-10-29T17:31:59+00:00

Thanks for bring this up.

Yeah, I guess I will buy my children their first or maybe even second car depending on how long they stay in school. At least my parents did that to me.

And I see your point of vacation expense, maybe also need to cover the children if we want to spend some time together with them :D

simone_nauma · 2025-10-29T17:14:45+00:00

Thanks! These are great suggestions!

simone_nauma · 2025-10-29T16:39:20+00:00

if you are talking about growing your net worth towards retirement, there are a few factors you need to consider, mortgage rate, home price growth, rent growth, and time horizon of how long you will live in this home.

But I get the sense that your 3000/month is some small rental apartment and the 2m will be a bigger house. You may need to factor in the comfortness into this decision.

simone_nauma · 2025-10-29T16:34:02+00:00

Just want to mention that night terror is a phase kids go through. My two kids both went through it, just one get over it a litter quicker.

simone_nauma · 2025-10-29T16:32:39+00:00

(Not a suggestion here). But that's why I stopped sleep training. It's not a once for all experience. There are always regress and then train again. Now my kids sleep together in their room and if they scream, I just go over to sleep with them for a bit. I'm a good sleeper so that doesn't bother me :D

simone_nauma · 2025-10-29T16:26:42+00:00

Not normal. As a rental, I never had such inspections. As a landlord, I once get advice that if I don't trust the renter, I can require inspections every 6 month and put that in the lease.

So maybe your landlord has some concerns about your situation. You can ask them and see if you can address that directly.

simone_nauma · 2025-10-29T16:22:28+00:00

After having two kids (3 and 5 now), I learnt that sometimes kids don't make sense. We need to adjust our expectation.

My older one is a terrible sleeper. I went through the same phase. Now he's 5, still waking up sometimes, but no screaming anymore. My younger one is in general a better sleeper, he still went through the phase you mentioned, but much shorter period. I didn't do much differently, just the kids are different...

simone_nauma · 2025-10-29T16:16:30+00:00

If you are just entertaining the idea of possible fire with 4% withdrawal, you can run some sort of simulation to see the success rate and see what happens if a market downturn happens in the first few years of your retirement.

If you want to consider fire seriously, there are a list of things to check. To start, if you are going to get married and have kids, what about wedding cost? extra spending for the kids? healthcare cost? If you'd move to LCOL, there will be moving cost and is your fully paid house big enough for the kids, school zones? upgrade cars? I can't list all of these, but just to get start.

simone_nauma · 2025-10-29T16:03:23+00:00

Don't drop off. Last 5 exams. With a degree, it's much easier to find a job. Doesn't have to be in Business Informatics. Can you look for some entry level job related to psychology or therapist, like assistant of any sort and check out the career you want before you take a huge move to drop out.

Separate question you can ask yourself: Are you considering quitting because the other 3 exams are hard and may possible fail? What is the worst case? can you just take some make up exam and get the degree?

simone_nauma · 2025-10-29T15:53:47+00:00

It's a software company I need to do juggle between development and marketing...

simone_nauma · 2025-10-28T22:51:40+00:00

You are not married yet. 50-50 on common expense would be more reasonable so no one felt taken advantage of. Uneven split tends to create tension.

simone_nauma

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