For Young Adults Stock Market Better Investment Than Buying a Home

Discussion in 'The Cocktail Lounge' started by Rainman, May 25, 2015.

  1. JR Ewing

    JR Ewing Super Moderator Staff Member

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    I wouldn't overburden myself with too much house while young. Wait until you're middle-aged / mid-career before you start looking at mansions - and also overpriced cars and other expensive toys. In your younger and early-career days, live frugally and put as much as you can into your 401k / IRA, stocks, mutual funds, etc.

    You're also more likely to have to move on occasion for career reasons when you're younger. If you need to sell a home in a hurry and perhaps even take a small loss, a 5% loss on a $200k home hurts far less than a 5% loss on a million dollar mansion. And higher end homes are often harder to sell.
     
  2. Trendtrader

    Trendtrader Member

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  3. gmckee1985

    gmckee1985 Senior Investor

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    I think that this pretty sound advice. Home ownership is nice. Don't get me wrong. But investments can pay off in a big way if you use your moneg soundly and wisely. Buying a less than desireae house in your early 20s can definitely be a waste of money and unwise in the long run.
     
  4. Jason76

    Jason76 Well-Known Member

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    One good investment in which you might need small payments over a long period of time is education. Assuming your training for an in-demand field, it will definitely pay off. On the other hand, I'm guessing most things which require payments are going to drain your cash with no real return.
     
    Last edited: May 30, 2015
  5. hijin

    hijin Guest

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    For me, investing while in the early twenties is much more feasible compared to buying a house. I am not saying that you should not buy a house, but you can if you can afford it. You have to deal with land titles, the price of land, the money spent to build it, and later on, maintenance. Whereas, if you rent, you just give your money to the landlord and let him deal with the headache maintenance. That is why in the early stage of a career, investing in the stock market is good because over time, your money will grow better than if you just let it sit in the bank. But of course, you should also save some money in the bank, but some of your savings should go to investments. And if you are wiser enough, if you really want to own some property, it is better to build apartments and deal with maintenance. At least, you get some passive income.
     

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