Chris Larsen argues homeowners should keep mortgages and invest their home equity elsewhere instead. He shows how $100,000 in equity on a $500,000 home could grow to $1,000,000 in five to ten years, and describes using guaranteed policies to fund his son's college.
A $500,000 home.
$100,000.
$1,000,000.
Over five or ten years (speaker says "five or 10 years").
About three years (speaker: "maybe it's been three years").
I asked everybody said, hey, who has a mortgage? And, you know, most people's hand went up. And I said, okay, if you had cash, would you pay your mortgage off or would you keep the mortgage? And I said, put your hand down if you would. If you would pay the mortgage off. And nobody's hand went down. Everybody kept their hand up. And the reason is. So if you think about. If you have a $500,000 home and you put $100,000 in it, your home, say, over five or 10 years, goes from 500,000 to. To a million dollars. If you've been in the real estate market the past few years, maybe it's been three years, you keep your capital, you still own your home, the home still goes up in value, and then you can actually take the equity out of your home. You borrow against that equity, and you can use it in another place, but still own your home and retain the value of that going up. The big difference, these policies and the amount you have in those. And this goes back to the reason we set this up for my son for college, is the amount is guaranteed.
“Grit is Good” and How to Keep Getting up When Your Business Gets you Down
