I’m 30, financially comfortable (net worth in low mid 7 figures, mostly in liquid ETFs). For the past 10 years I’ve lived very frugally and delayed gratification, prioritizing wealth building.
Now I’m considering buying my dream home, which would cost me roughly a 15~20% hit to my net worth compared to just continuing to rent and invest.
On one hand, I know compounding works best if I keep money invested and avoid “luxury” purchases. On the other, this house would give me stability, happiness, and the lifestyle I’ve been working toward.
I plan to live in it for at least 10~20 years. Is it good idea to pull the trigger now for quality of life, or should I continue delaying gratification for the sake of financial optimization?
Would love to hear from those who’ve been through this, did you regret buying your dream home early, or regret waiting too long?
Edit:
For loan suggestions related, the 15~20% hit is actually based on a 10 years calculation with the loan interest payment and down payment compared to market average return, so to be more exact if i buy the house I'll be 15~20% less money in year 2035 than not buying.
Should I buy my dream home now, or keep delaying gratification for compounding?
byu/LifeReboot___ inpersonalfinance
Posted by LifeReboot___
5 Comments
Houses appreciate too brother and also count towards your net worth. Go buy.
You can make 15-20% profits in your etf back in like 3 years by doing nothing but holding onto what’s remaining after the home purchase. So yeah go for it.
Save enough to feel secure, spend enough to feel alive
Why don’t you treat buying the house as moving from one asset class to another? Renting is just throwing money into the pit in this context.
Man it’s like I’m reading a post from myself 6 years ago when I was 30. Doing great financially as well and I bought a 4200 square foot home designed by one of Frank Lloyd Wrights protégés at 31. Realized after about a few weeks, I made a really stupid decision. Ended up selling it and buying a really nice townhouse for 1/4 the price that’s more than enough space for me. Splurged a lil bit on some sports cars over years but I’ve been pretty smart. I don’t mow my lawn and live in a community with a sick golf course.
My advice would be to at least look at townhomes and condos. Less responsibility!! Enjoy your 30s with your financial situation. Don’t jump into some home you think you’ll live in for 20 years because when you meet someone and get married, they’re the ones who start making the home decisions and you can rent the townhouse or condo forever while it simultaneously appreciates (most likely).