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Nearly 70% of Home Owners Regret Buying Their House!

That’s right, “68% regret that purchase”[i] and report that watching others suffer the devastation that occurred in the 2008 downturn and following recession was the reason why they wish they had never purchased their home.

In a Bank of the West study, “Paying off debt and having the financial means to retire comfortably”[ii] were the second and third regrets of those surveyed.  Essentially, more than 5 out of 10 participants were struggling with debt management and nearly 1 out of 2 were concerned about being able to retire comfortably.

Ironically, nearly 1 out of 3, of these participants had already borrowed against their retirement funds to make the down payment on their home, which now they are regretting ever purchasing.  Tragically, those regrets do have some merit as “only Dallas, Denver and Seattle have home prices that are keeping ahead of inflation.”[iii]

Real estate should not necessarily be called an asset purchase. This statement doesn’t mean that there isn’t an emotional reason why we should own the homes we live in, but economically, the value of that piece of real estate we call home is NOT necessarily worth the money that we have paid for it.  Is that a bad thing?  Not necessarily.  The cars we drive are NOT worth the money we paid for them, but we still need cars to do what we need to do in life.  For that matter, the food we purchase isn’t worth what we paid for it, i.e., we can NOT turn around and sell it for what we purchased it for. But that doesn’t mean food is worthless.

Wealth Summit 2018

The issue here isn’t that real estate is worth or NOT worth purchasing.  The issue is how we have been lead to believe what to invest in and what NOT to invest in.

The traditional sequence to this dilemma is:

  1. Invest first, (buy a home, purchase your 401k, your mutual fund, bonds and/or stocks)
  2. Manage your debt next, (try to pay off your home early, contribute more than your employer’s match to your 401k, find and pay the lowest management fees, credit card fees or interest rates)
  3. Save when possible,
  4. And finally, protect your assets.

This method of building wealth can work if the market is bullish and you have a foolproof steady income for life…and have no crises (health care, divorces or litigation costs) that consume your ability to save.  Dolefully, that is NOT what historically or typically happens.

First of all, the market has been extremely volatile.  Secondly, the average American changes careers 5-7 times during their working life time.[iv] Thirdly, if you don’t determine what to save and do so sooner than later, Parkinson’s Law will prevent you from saving enough.  And finally, even if you are able to build a large enough nest egg following this order of events, a market correction like 2001 or 2008 can literally destroy much, if not all, of what you have been able to build.

The better way to build the financial security that you are looking for is to reverse this traditional sequence and protect your future asset first, not last.  Once your future assets have been protected, then begin saving. This will minimize the concern about what might happen in the future.

Once savings is commenced, debt management can be made more effective. When approached in this sequence, more liquidity in your finances can be created which will allow greater opportunities for investing. Investing should be contemplated last rather than first, in the order of building your nest egg and retirement.

Steps to building Financial Security:

  1. Protect Future and Current Assets
  2. Save
  3. Manage Your Debt
  4. Invest

Now, let’s look at how to protect your greatest asset and save in a place that will give you the greatest benefit. What is the most common financial tool of millionaires and billionaires? Participating Whole Life Insurance. You can use it too…even on a smaller scale while positioning yourself to be the millionaire or billionaire we speak of in future days. You see, these people don’t overlook the possibility that everything they have planned and worked for could be lost tomorrow, if it isn’t protected. And that is why smart money managers will never tell you that participating whole life insurance is a bad investment. There simply are no regrets for purchasing a participating whole life policy when it has been engineered to develop high cash values initially and high death benefit in the future when you will most probably want the face value that allows your spouse and/or loved ones to continue on without your further assistance.

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[i] https://www.newsmax.com/Finance/streettalk/millennials-buying-homes-housing/2018/07/19/id/872607/
[ii] Ibid
[iii] Ibid
[iv] www.careers-advice-online.com/career-change-statistics.html