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Imagine this: nearly seven out of ten people look back at buying their homes and say, “Oops, I wish I hadn’t done that.” Surprising, right? Well, a whopping 68% express regret over their home purchase, mainly because they saw others suffer during the 2008 economic downturn and the following recession, and now they’re like, “Maybe I shouldn’t have jumped into that mortgage.”
In a study conducted by Bank of the West, they found out that after the home-buying remorse, the next big regrets for people were all about money. Coming in at second and third place were “Paying off debt” and “Having enough money to retire without worries.” So, basically, more than half of the folks surveyed are wrestling with debt, and almost half are stressing about whether they’ll have enough cash to live the good life when they retire. Tough times, huh?
It’s kind of ironic that almost one-third of these folks who regret buying their homes actually dipped into their retirement savings to make the down payment. Now they’re looking back and thinking, “Maybe that wasn’t such a great idea after all.” Sadly, their regrets aren’t baseless because, guess what? Not many places are seeing their home values rise faster than inflation. Only places like Dallas, Denver, and Seattle seem to be keeping up with the inflation game when it comes to home prices.
Now, let’s talk about calling real estate an “asset purchase.” Sure, emotionally, having a home can mean a lot to us. But economically? Well, the value of that piece of property we call home might not match up with what we shelled out for it. Does that make it a bad thing? Not necessarily. Think about it: the cars we drive aren’t worth what we paid for them either, but we still need them to get around, right? And hey, the food we buy isn’t exactly an investment either. We can’t sell it for what we paid for it, but that doesn’t make it worthless. It’s all about perspective.
Let’s get real here: the problem isn’t whether real estate is a good investment or not. It’s more about how we’ve been taught what to invest in and what to steer clear of.
Here’s the usual drill:
Step one: Invest your money. You know, buy a house, stash cash in your 401k, maybe dabble in some mutual funds, bonds, or stocks.
Step two: Tackle your debt. Try to pay off that mortgage faster, kick in more than just the bare minimum to your 401k, and keep an eye out for those sneaky credit card fees and interest rates.
Step three: Save whatever you can. Every penny counts, right?
And finally, step four: Protect what you’ve got. Insurance, rainy day funds, the whole nine yards.
Sounds like a solid plan, right? Well, it can be, if everything goes swimmingly. But life isn’t always a smooth sail. Unexpected stuff happens – health crises, divorces, lawsuits – and suddenly, that neat little plan goes out the window.
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Sadly, that’s often how it goes down, despite what the textbooks might tell you.
Alright, let’s break it down. The market? It’s been all over the place lately. Plus, most folks switch careers multiple times in their working lives. Talk about uncertainty, right? Then there’s this thing called Parkinson’s Law – basically, if you don’t start saving early and consistently, it’s like trying to fill a bucket with a hole in it.
And let’s not forget about those market crashes, like the ones in 2001 and 2008. They can wipe out your hard-earned savings faster than you can say “401k.”
So, here’s a different approach: flip the script on the traditional plan. Instead of saving and investing first, focus on protecting what you’ve got. Once that’s sorted, then start socking away cash. This way, you’ll worry less about what curveballs life might throw your way.
Once you’ve got some savings going, tackle your debts. With this strategy, you’ll free up more cash flow, giving you more flexibility to invest down the road. Speaking of investing, that comes last in this new order of operations. By prioritizing protection and savings first, you’ll build a more solid financial foundation for your future.
Steps to building Financial Security:
Now, let’s focus on safeguarding your most valuable asset and finding the best place to save for maximum benefit. Ever wondered what the big shots in finance use? It’s often Participating Whole Life Insurance. Yep, even you can get in on this action, even if you’re not quite hitting millionaire status yet. Here’s the deal: these high rollers don’t take chances. They know that everything they’ve worked for could vanish in an instant if it’s not protected. That’s why savvy money managers swear by Participating Whole Life Insurance.
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You might be thinking, “But isn’t life insurance just for when I kick the bucket?” Well, yes and no. See, with Participating Whole Life Insurance, you can build up some serious cash value right off the bat. And down the road, when you need it most, it kicks in with a hefty death benefit. It’s like having a safety net for your loved ones, ensuring they’re taken care of even if you’re not around.
So, don’t overlook the power of Participating Whole Life Insurance. It’s not just about planning for the future – it’s about protecting what you’ve got right now and setting yourself up for financial success down the line.
Dr. Tomas P. McFie
Most Americans depend on Social Security for retirement income. Even when people think they’re saving money, taxes, fees, investment losses and market volatility take most of their money away. Tom McFie is the founder of McFie Insurance which helps people keep more of the money they make, so they can have financial peace of mind. His latest book, A Biblical Guide to Personal Finance, can be purchased here.
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