Did you Lease or Buy ?
#181
Lexus Fanatic
To be fair, it really isn't in the US either in most circumstances. You have a $250,000 exemption from capital gains on your primary home as an individual, and married couples have a $500,000 exemption. If you're married and your spouse dies, you get a stepped up basis which basically wipes out all of your potentially taxable gain until that point, and then you still have the $250,000 exemption for gain beyond that point. If you die and your kids inherit it...they get an again stepped up basis.
Very rarely do I ever deal with a homeowner selling their principal residence where they have to worry about a capital gain, even when they have made several hundred thousand dollars on the house.
Very rarely do I ever deal with a homeowner selling their principal residence where they have to worry about a capital gain, even when they have made several hundred thousand dollars on the house.
#182
My issue with putting extra money into your mortgage is that you're paying off a debt that has a very low effective interest rate, and that money will earn you better returns properly invested. Your home is already appreciating and you're using somebody else's money for the investment.
Another option: That extra few thousand a month you are putting into your mortgage could be placed in another investment property. This is how people get rich off real estate. They don't pay off their mortgages early, they take advantage of the market.
#183
Lexus Fanatic
Had another client who came to me and he said I am 63, I have $1M and I want this $1M to make me a reliable, comfortable retirement income within the next 3 years. Well, we sold him 5 investment houses over the past 3 years, his total investment for all 5 is in the mid $800k range, he's bringing in ~$10k/month in gross income, when you factor in expenses (taxes, vacancy, etc) he's netting about $8k a month, coupled with he and his wife's SS income and their other investments affords them a very comfortable retirement, and he enjoys managing the properties, keeps him engaged, etc. If you're young and you don't have $1M lying around, you can still start to build a portfolio like that which at some point will turn into a great source of retirement income for you. They die, leave the properties to their kids they get the stepped up basis and can sell them for no gain or continue to operate them. In order to have that kind of monthly income without touching the principal would require a lot more wealth.
Lots of different ways to do it too. I have a buddy that owns parking spaces. He buys a parking space for $8-12k, and rents it out for $165 a month. Thats a great return,
#184
Pole Position
#185
Lexus Fanatic
Originally Posted by situman
Changed. Sucks to think faster than I can type sometimes.
#187
Lexus Fanatic
Originally Posted by ragingf80
I'm not incredibly smart and I still have this problem!
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