Borrowing To Invest Vs. Saving To Invest | John Chow dot Com
Dec.22, 2008 in
stocks, Work/life balance
This is a follow up to my post about bums not being richer than you. I want to give an example of how a leveraged investment not only make you more money, but is no more risky or cost any more than the standard “save and invest” method.
The Money Saver
The saver is someone we’re all familiar with. He likes to save a certain amount of money every month into investments so he will have a nice nest egg when he retires.
via Borrowing To Invest Vs. Saving To Invest | John Chow dot Com.
December 31st, 2008 at 11:55 pm
where does the $120,000 equity come from???
January 2nd, 2009 at 10:44 am
I guess John is assuming that both sides have a house that has some equity built up in it…
It is kind of a stretch though that at the beginning of your saving battle you already have 120k in equity in your residence. Usually that takes a few years when starting from scratch – unless you time the market right or do a couple flips along the way…