Should you follow conventional wisdom when it comes to your financial decisions? Eric shares when that conventional wisdom might not be best.
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Let’s talk about conventional wisdom when it comes to your finances. Does it all still ring true? Eric clarifies what your approach should be instead when it comes to these financial concepts.
For starters, real estate is one of those things people say you can’t go wrong with. Does it actually make sense to buy real estate today? It’s an expensive asset class right now. If you’re looking at it as an additional asset to rent out, don’t forget that you’ll have to deal with the renters. Does that fit into the lifestyle you want? Make sure you understand the nuances that come with real estate. Another thing to remember is that real estate is not a liquid asset.
If you have a mortgage is that considered good debt? Good debt is something improving your net worth or marketability. Things like student loans might even be considered good debt as it makes you more employable whereas a frivolous vacation doesn’t. No debt is better for you in retirement, but don’t let debt be the reason you don’t retire.
Is retirement the time to relax? That used to be what retirement was all about, but some may choose to keep working longer because they enjoy it or want to keep making money. You want to retire to something, not just from something. Have some goals of what you want to do in retirement. Do you want to fix up the house or travel or spend time with the grandkids? Instead of simply sitting back on the porch, you might find yourself wanting to stay active with the things you enjoy.
If your investments aren’t doing well, is that the time to do something else? There’s always new opportunities, but ask why you own what you do. Do you want to sell stocks when they are down or make income? Think through the long-term plan before you make a big change with your money.
Listen to the entire episode or skip ahead using the timestamps below.
0:47 – Should you invest in real estate?
3:49 – Is there good debt vs. bad debt?
5:52 – Is retirement a chance to relax?
8:51 – Should you try something else with investments?
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