Should You Ever Borrow Money to Invest? | DFI30
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- Опубліковано 11 лип 2024
- Should You Ever Borrow Money to Invest? | DFI30 | Ep. 409. One of the most common borrow-to-invest strategies is to take money from your home equity to purchase an investment property. But is this always a good idea? What if you borrow to invest in the stock market instead? Is that riskier? Is it ever OK to take on debt to invest or is it something you should never do? On today’s podcast, Ted Michalos and Doug Hoyes walk you through how to decide when you are ready to invest, the three ways to invest in stocks, what risks are, and the general dos and don’ts of using your hard-earned money to potentially get a return on it. Tune in for lots of practical advice!
Resources Mentioned in the Show:
Straight Talk on Your Money book by Doug Hoyes: www.amazon.ca/Straight-Talk-Y...
Hoyes Michalos Joe Debtor Bankruptcy Study www.hoyes.com/press/joe-debtor/
Residential House Prices, Historical Chart: fred.stlouisfed.org/series/QC...
#investing #BorrowingToInvest #BorrowToInvest #Debt #DebtFree #DebtFreeIn30 #DFI30 #Stocks #StockMarket
I've just retired recently and I must say I found this video informative and great to review. These psychological concepts are much more useful for individuals attempting to avoid mistakes than I realized when I was first introduced to them. This is probably why Warren Buffett talks so much about temperament being crucial to his investing success.
Developing a solid financial portfolio is more difficult, therefore I suggest you seek expert assistance. The ideas you receive after that can be tailored to your long-term goals and financial desires.
There are many other interesting stocks in many industries that you might follow. You don't have to act on every forecast, so I'll suggest that you work with a financial advisor who can help you choose the best times to purchase and sell the shares or ETFs you want to acquire.
I've been in touch with a financial advisor ever since I started my business. Knowing today's culture The challenge is knowing when to purchase or sell when investing in trending stocks, which is pretty simple. On my portfolio, which has grown over $900k in a little over a year, my adviser chooses entry and exit orders.
Could you possibly recommend a trustworthy advisor you've consulted with?
Credits to 'Natalie Lynn Fisk' she has a web presence, so you can simply
As an investing enthusiast, I often wonder how top level investors are able to become millionaires off investing. . I’ve been sitting on over $545K equity from a home sale and I’m not sure where to go from here, is it a good time to buy into stocks or do I wait for another opportunity?
Look for stocks that have paid steady, increasing dividends for years (or decades), and have not cut their dividends even during recessions. Alternatively speaking to a certified market strategist can help with pointers on equities to acquire
I agree, having a brokerage advisor for investing is genius! Amidst the financial crisis in 2008, I was really having investing nightmare prior touching base with a advisor. In a nutshell, i've accrued over $2m with the help of my advisor from an initial $350k investment.
impressive gains! how can I get your advisor please, if you dont mind me asking? I could really use a help as of now
Just research the name Angela Lynn Schilling. You’d find necessary details to work with a correspondence to set up an appointment.
Thank you for this Pointer. It was easy to find your handler, She seems very proficient and flexible. I booked a call session with her.
Building wealth involves developing good habits like regularly putting money away in intervals for solid investments. Financial management is a crucial topic that most tend to shy away from, and ends up haunting them in the near future.
samdeymon
I borrowed against an insurance policy at 6%. invested the money and made 10 to 12% on it for years. Insurance company kept begging me to pay off the loan. No way.
I love the accents lol and your comfortable and casual manner thank you. I must tell you my perspective on my home's equity and it's an ethical one. The equity is MINE, not the banks. Yet, the banks make it near impossible for me to ACCESS the equity unless I cash out re-fi which costs a lot of money. Not sure what a home equity costs to set up but my point is I can't just walk up to the window and ask for some of my equity. 2ndly, the bank is USING my money to make investments with. So, if the banks are using my money/equity and I put down 20% to start with I sure as heck want a piece of that game. I see this arrangement as criminal. and unethical.
RE: stocks. NEVER ever use MARGIN on stocks, especially with borrowed money. ALL stocks are bad. EVEN the blue chips. A margin call on AMZN would have occurred 9X. I will however, use margin to buy LEAP options, which are a form of leverage and then hedge them. If you don't know how to hedge then just commit your xtra money to a good mutual fund and DCA every 2 weeks and check back in 30 years. But, if you MUST invest your home's equity only do that if you know how to hedge using options. The advantage of stocks over RE is the liquidity and the ability to hedge. I haven't heard of a way to hedge an income property gone bad. In a few years I will pay off my mortgage with a HELOC (low cost), use the equity to scale up my options strategy. I see no point in leaving the money all to the bank. As long as I am protected with a hedge and I make more from the investment than interest loan rate, my heirs can have the equity left in the house and the hedged stock portfolio upon my death. I'm just re-positioning my wealth. The banks keep making money off the homeowners year after year. Learn how to play their game. BTW, I'm am sure pension funds and Insurance companies know how to hedge. To NOT hedge stock investments is insane, imo. Learn to use options wisely and with a hedge. Or I promise the AMZN scenario will come to bite us all more sooner than later. The market is open for business everyday bc the market makers owned by the banks know how NOT to lose. They love naïve investors. These unskilled investors keep the lights on, lol. Just like a casino.
Warren Buffett underscores the vital importance of understanding compounding and adopting a long-term perspective for financial success, as leveraging the compounding effect and maintaining a extended investment horizon enable individuals to accumulate substantial wealth through patience and strategic planning.
Navigating the complexities of investing can be challenging for newcomers, but by staying informed through analysis of financial news, market trends, and expert perspectives, I aim to offer valuable guidance and help individuals make well-informed investment decisions, emphasizing the importance of seeking advice from financial professionals and conducting thorough research.
Certainly not, as I've closely tracked the performance of my portfolio, witnessing an impressive surge of $433k in just the last two quarters. This experience has illuminated the reasons behind the substantial gains that seasoned traders often achieve in the seemingly unpredictable market. I must emphasize that embracing this path has been one of the most audacious choices I've made in recent times.
*@kristenpierce8661* I’ve been down a ton, I’m only holding on so I can recoup, I really need help, who is this investment-adviser that guides you
Definitely! All of this happened in less than a year after Camille Alicia Garcia told me what to do. I started with less than $100,000, and now I'm about 17,000 short of having a quarter million dollars.
She appears to be well-educated and well-read. I just ran a Google search for her name and came across her website; thank you for sharing.
Owning a house IMHO is piece of mind now and into the future. Our house costs us a fraction a month compared to rent currently and even if you have a mortgage (mortgages and there payments typically go down each year) Unfortunately to many people want to live like there rich, $100,000 kitchens, $50,000 bathrooms etc so the house becomes a huge monthly payment.
it sounds like you have almost paid off your mortgage so congratulations. May I ask what you will do with the equity you have sitting in the house while you pay taxes and wait for the need for repairs to come up etc?
Is Nortel Huawei now?
I love tha show, however, I have to disagree.
You assume that margin investors max out on what they can borrow & all the investments tank. This cam be farther from the truth.
I borrow on margin about 10%, of the value of ny stock portfolio, & buy blue chip businesses like banks, Utilities, food companies index funds and ETF's. I pay off the margin debt, & now I have more equity. Those stock also provide, a growing dividend stream. Not to mention, I write the interest off on my taxes.
You also assume the worst,for the stocks, that an investor purchases. I believe, any good investor builds a diversified portfolio which helps to mitigate a market on the downside. A bear market, is a great way to load up on quality companies, & increase projected returns.
Margin debt, is a good use of borrowed money, as long as the investor is not over leveraged. Even if stocks fall, a portfolio that employs only 10-15% leverage, will most likely not face a margin call.
I need to better with margins i used all i borrow in dividend stocks and be on maintance calls and so on. Of course the divs buy me more time to correct the problem but i needa go at a right pace about it
Doesn't matter to me so long as the income isn't "Earned" with auctual hard labor but rather just traded then yeah
If you borrow money to buy blue chip stocks like Apple, Google, Microsoft etc and invest the money into a TFSA if your investment goes down it’s just a waiting game and you can sell options against your stocks to make more than enough income to pay the interest on the money. So I guess what I am saying borrowing against your house equity via a Heloc can make sense. Now if someone buys crypto or very speculative stocks like cannabis than your gambling not investing.
you didn't talk about exempt market securities or the tax benefits of borrowing to invest.
Noooooo
Loc prime +.5 buy blue chip dividend stocks paying 4-6%. Pay down loc.
Theres 2 sides to that coin.
Mr Sam Deymon really knows how to trade, it's deep knowledge of how the market works, reading signals to perfection, I feel very safe trading with him.