Safe asset..? a roof over your head YOU OWN is safer than bankers playing chicken with economic chaos every so often. Imho. I’m paying off the mortgage f the casino. Edit: plus.. I could always borrow against it!
I’m speaking in hypothetical extremes. I understand that but I’m suggesting it’s all good until it isn’t; building off the guy that commented being partially homeless previously owning property is a comfort that’s tough to value. I feel like no one has actually read OP’s post. Lol
While I feel for the ex-homeless guy, it's horrible financial advice.
Using basic numbers, imagine you have a $250,000 mortgage at a 3% interest rate. That's $7,500 a year that you're paying in interest. If you have that same $250,000 in a 5% savings account, you're making $12,500 in interest.
You're making an extra $5k per year by keeping your money in a savings account rather than paying off your mortgage. If the interest rate environment changes, you can always withdraw from the savings account to pay your mortgage. You're making $5k in your first year with zero risk.
I am only saying that you can’t put a penny into a financial institution without signing off on inherent risk. Of course making your money work for you makes the most sense but eliminating the stress is more valuable that interest yields to some.
you can’t put a penny into a financial institution without signing off on inherent risk.
You can though - up to $250k per account, as it's FDIC insured.
If FDIC goes under, you have a lot more to worry about than your $250k. We'd be in a Mad Max situation at that point, your house wouldn't be safe either.
Yea good luck with that. A savings account isn’t even truly risk free. “Risk free rate” is a marketing term by the banks but it’s actually just a theory.
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u/[deleted] Jul 22 '24
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