Be careful buying in a hot market, you might overpay. Just because it's hot today does not mean it's hot next year. Don't chase hot markets,just like chasing hot stocks. Keep to basics, bricks and big trees.

@retiredmanager510

4 жыл бұрын

Great advice.

@eurekahope5310

4 жыл бұрын

My thought exactly. My parents sold in a hot area and the next year the market dropped despite a decent economy. If the area is oversaturated, the market may be inflated. I would consider wider factors. Are people moving in or out? Are there plenty of jobs? Is crime low? Is the area attractive? Is the state headed in the right direction for attracting and retaining people? Can they afford a home that would be attractive to a wide variety of buyers (more than 2 bedroom, decent yard, good schools)? Edited to add: We bought our home right before the Great Recession dropped the housing market. We could not have sold at year 5 without paying the bank. The area had fit Dave's criteria but we bought based on potential rather than actual value. It was the one big financial mistake we have made. We rode it through and have made the potential a reality, but there were many years of regret.

@justinacase2623

4 жыл бұрын

Also, any down turn in the economy those thrown up hot houses can be had for half price, where as a solid neighborhood will still fetch good prices.

@lifeofsim7070

6 күн бұрын

@@retiredmanager510was it thought?

5 years is definitely right in that grey area of whether buying or renting makes sense, gotta run the numbers.

Awesome insights. Had never thought of doing this. Thanks Mr. Ramsey!

Why not buy and then turn it into a rental when you're ready to move? As long as there is positive cash-flow, even after paying for a property manager, why not enjoy a little extra income during retirement?

This video was just what I was looking for. Thanks Dave!

Why not downsize the storage unit? Get rid of some furniture and move it to a cheaper storage unit.

This is why I own storage REITs in my Roth. Many people buy stuff and pay monthly to not use it.

@c103110a

4 жыл бұрын

Smart. I was going to say that he should sell all his junk in storage and, if he plans to downsize and move in 5 years, buy less new junk then. I know a guy who puts his Christmas decorations (tree, wreaths, lights, etc.) into a storage unit for 11 months per year. Crazy.

@harrisonwintergreen1147

4 жыл бұрын

But you gotta have a place for your stuff...

@trailrunnah8886

4 жыл бұрын

@@harrisonwintergreen1147 have less stuff.

@dannywalker176

4 жыл бұрын

Storage is insane. I know people here in Florida who have storage units in other states they are paying on.

@trailrunnah8886

4 жыл бұрын

@@dannywalker176 it's crazy how much stuff people accumulate. I get wanting to keep your stuff, but if it doesn't fit where you live, maybe it's stuff that you don't need.

Sell the stuff in storage or give to family who will get it anyway when you pass. Paying for storage is buying things you already own.

@blackworldtraveler3711

4 жыл бұрын

They won't. They will keep paying.

@flyrehash5124

4 жыл бұрын

BlackWorldTraveler as dumb consumers tend to do

Flat out great analysis!

all being even....if you're moving in 5 years....the safe and smart move is to rent and not buy real estate. Staying 10 years, then okay...go ahead and buy. Thanks for the call.

Great question and even better answer.

Comparing a home's purchase price to its sale price and declaring that X dollars were made (or lost) only works if you pay cash. Realtors hate this fact. But it's true. What a buyer pays is the down payment plus the aggregate of monthly payments. (Set aside maintenance and upkeep costs and HOA for now.) The real price paid vs. sale price is a better indicator of true cost. It's often less than buyers think. Plus...investment gain on the down payment is forfeited - not a small sum for many transactions.

Obviously, I am pro-mortgage, but this analysis certainly makes sense! The only thing that is not discussed is how much cheaper the mortgage may be versus rent. In a good market, rental costs may be a decent chunk higher than a mortgage with 20% down.

@mkite715

4 жыл бұрын

Mortgages Made Manageable Buying a house is good but only once you’re 100% debt free with an emergency fund of 3-6 months of expenses, plus a good down payment. A mortgage is fine if it’s a 15 yr fixed where the payment is more than 25% of your take home pay. Mortgage brokers and realtors often say differently, but then again, they’re usually trying to get you to buy a house!

Buying makes sense if you have triple the down payment, I think it’s important to learn about stocks

None of this applies in the craziness now

Wow dave just took a tangent from the question. Should I buy house if I am 5 yrs from retirement. Dave is giving advice on generally buying real estate.

@snoop5118

4 жыл бұрын

Karen M True! I was just thinking that!

@christianamericandominican2470

Жыл бұрын

He never answered the question. I'm in the same boat. I'm not looking to make an investment. i just can't afford paying the high rent and I'm looking to buy in a cheaper rural area. I'm buying my first home close to retirement. Is that smart or should I rent?

@DoctorSmartyPants

Жыл бұрын

@@christianamericandominican2470 I would buy. It is an amazing feeling and accomplishment to own a home.

@carolynmerritt7100

5 ай бұрын

It's never yours until it is paid for. It's more like long term rental with all of the financial responsibility of upkeep

@mymotherwasright3079

2 ай бұрын

I totally agree. I was thinking he is not answering the caller"s question. That was an answer to a question in Dave's head!!!

Am I the only one that knows what Dave is going to say but still watch?🤓

@linak7155

4 жыл бұрын

He's consistently truthful even if he steps on your toes! I like him! 😊

@DoctorSmartyPants

4 жыл бұрын

Nope! Lol.

In hindsight it would’ve been a very good investment to purchase a home in early 2020.

Is this advice good today given current political and economic trends in 2021?????

Five years is not long if you are sure about moving. I would park that down payment money in a 5 year deferred annuity and re-evaluate at retirement. Florida is great.

@capnskiddies

4 жыл бұрын

That's probably the sane move. Buying two houses in 6 years at retirement age is not.

Is this guy actually asking should he buy two houses in the next six years. One now, then move in 5 years. No way. Too much stress and heartache.

What did this caller do with all his money where he didn’t purchase a home years ago?

@raidertyrone3382

4 жыл бұрын

Put his kids in private school and paid for their college also

You can bet that a given appreciation rate will hold for five years or more? Not a sure thing in the three states where I've bought - and then sold -homes...

Bankers Law ''always buy in a slump'' The secret is to watch the market. We live in amazing times where nothing anymore is stable. A house is no longer a home, just an asset

HUH??? Dave is not answering the caller's question. Dave is answering a question in Dave's head.😂

👍

This was posted just before the pandemic arrived. I'm sure that turned everything he said on its ear.

Can dave afford to live in Manhattan or LA?

You are speculating on the market if you are there for less than 10-15 years. Do you want to risk it?

@HamiltonRb

4 жыл бұрын

The four phases of a real estate cycle is recovery, expansion, supply/demand & finally supply outweighs demand with the average cycle being 18 years, so you are not far off at 15

Is there a video about doing the steps, but not owning a house? I rent.

@BlazeTrinity

4 жыл бұрын

Just skip the paying off your mortgage step.

I would stick with renting! If you look at the cost of ownership and the price to sell, it's not worth it for five years! The risk is you can't guarantee the market will slump, and you will be stuck there. You are risking loosing that 20%.

@blackworldtraveler3711

4 жыл бұрын

I was thinking of retirement when buying my condo in 1993 and glad I did.. Great location and all paid off long ago so I have that to fall back on. Won't rent it out and just lock it up when away living elsewhere.

Move to Detroit 😂. There are a lot of $1 homes there.😁

@charleneroyal7381

Жыл бұрын

What about all of the crime in Detroit? Isn't it still a war zone with the Democrats in charge?

Hi if anyone is reading this, I’m looking for advice on where to save money. Savings, IRA, 401k???? I’m 20 not sure what would be best to stash my cash

@mkite715

4 жыл бұрын

Go see one of the financial people dave recommends. Smart Vestor Pros. Dave’s advice is before you start investing anything, make sure you get through college debt free, pay off all debt including college loans if you have them, and save up an emergency fund of three to six months of expenses. THEN you’re ready to start investing. But given your age (you’re young!) I would just focus on getting myself through school (if you’re going to school) debt free or at least stop getting into more debt, save up your emergency fund, then have some money set aside to get yourself an apartment.

@mkite715

4 жыл бұрын

Josh S That’s not a fair statement. I work with one of his smart vestor pros. He’s been great. He follows Dave’s teaching and has a picture on his wall of him and dave at Ramsey solutions. He’s very thorough, explains everything to me, and believes in Dave’s investing advice. His firm used American Funds, a well established, well known mutual fund company. He’s not slimy at all.

@mkite715

4 жыл бұрын

Mr. Wick Thats not a fair statement. You do not pay fees. The people he endorses pay a small fee per lead that comes in. The financial person im working with doesn’t charge me anything to work with him because I came in through dave. He’s paid the same way he would be for anyone. There are commissions from the mutual fund company, and yes the commissions are accounted for out of your portfolio. The overwhelming majority of today’s everyday millionaires in the millionaire study they just did work with a investment professional. The results are in the book everyday millionaire. I don’t DIY a root canal and that’s a fifteen-hundred dollar job. I’m not DIY’ing my investments. It pays to have someone in your corner.

@tadweaver1086

4 жыл бұрын

1) If you have any debt, pay that off first. 2) Build up your savings worth 3-6 months of expenses next. I recommend parking that into a high yield savings account through either a bank or credit union that is federally insured. You'll get paid dollars in interest every month versus pennies in interest by doing so. 3) Once you get that in place, put 15% of your income in a 401k and/or Roth IRA. If your employer has a 401k plan and offers to match whatever you contribute to it, then by all means do this first! Always try and max out whatever they will contribute up to. For example, my employer matches 25 cents for every dollar I put in up to 6% of my total pay. In this case, I contribute 6% of my paycheck to the 401k knowing that I will get a guaranteed 25% ROI plus compound interest on top of it! I then put the remaining amount into a Roth IRA. Now if your employer doesn't contribute any match and the plan they offer doesn't have good investment options to choose from, then I personally recommend putting all 15% into the Roth IRA because, not only do you tend to get better investment options this way, but your money will also grow tax free in the future! Hope this helps!

@johnlove5079

4 жыл бұрын

Buy and hold silver coins and silver bullion

I need to talk to a mortgage broker

S&P is up 30% this year is the exactly reason why you should never buy a house with all cash...

@Andy-lr8qp

4 жыл бұрын

pimpballer3 can you invest in that if your Canadian ?

@Parth9PTL

4 жыл бұрын

S & P gain is temporary but the house is permanent

@pimpballer3

4 жыл бұрын

@@Parth9PTL If your house is permeant, you are doing something wrong. The liquidity on a stock is so much better than buying a property.

@mkite715

4 жыл бұрын

pimpballer3 Debt free is always the way to go and the shortest path to wealth. Always. Not paying cash for a home when you have the cash - so you can invest in the stock market - is the same thing as borrowing money to invest in the stock market. You’re not accounting for risk. The more money you borrow, the more risk you have. 100% of the foreclosures occur on homes with a mortgage. Instead, pay cash for the home and used the increased cash flow from not having a mortgage payment to invest. You know how quickly the average mortgage payment invested in good mutual funds turns into $1 million? About 8 years.

@Corpsecreate

4 жыл бұрын

@@mkite715 not sure if you are trolling

Judging from his voice, he would not be good as a 5-year investor!

Sir, you are teaching great things but one thing that bothers me is your usage of God's Name in vain. Please work on that! This does not glorify God.

@griseldacabrera4024

4 жыл бұрын

elaborate

As long as a socialist Democrat isn't elected Dave's formula might work

@miriambertram2448

4 жыл бұрын

@John Lester they can fight like crazy like the new batch in the House of Representatives who are amazing. However if we don't have the majority there's nothing we can say that would make a difference

Comparing a home's purchase price to its sale price and declaring that X dollars were made (or lost) only works if you pay cash. Realtors hate this fact. But it's true. What a buyer pays is the down payment plus the aggregate of monthly payments. (Set aside maintenance and upkeep costs and HOA for now.) The real price paid vs. sale price is a better indicator of true cost. It's often less than buyers think. Plus...investment gain on the down payment is forfeited - not a small sum for many transactions.