3043 Maritime Forest Dr, Johns Island, SC 29455
4141 Chisolm Rd, Johns Island, SC 29455
If you’re rocking a $200 million net worth and feel conflicted about whether to upgrade to a $30 million mega-mansion from a $10 million home, my 30% guideline should help. Suddenly, $30 million seems totally reasonable since it’s half the amount you could responsibly afford.
Here’s a chart showing the different levels of income and net worth required to buy a home at various price points.
There’s no point in investing and working if you don’t enjoy your money. Therefore, I say it’s good to live better if you choose to continue to work and take more risks.
At the same time, be appreciative of all that you have today. Living in your primary residence for more than 10 years as your net worth grows will help keep you disciplined.
In conclusion, shoot for your primary residence value to equal no more than 30% of your net worth by age 45. If you do, you will find a great balance. In finance, there are few things better than enjoying your home in a stress-free manner while it also appreciates in value.
If you’re interested in investing in real estate more surgically, check out Fundrise, one of the largest real estate crowdfunding platforms today. Fundrise specializes in residential real estate to take advantage of positive demographics and rising rents.
Gaining the appropriate exposure is more than half the battle in growing your wealth through real estate. You can now start investing in residential real estate across the country, hassle-free for just $10 a month.
Alternatively, if you are an accredited investor, you can check out CrowdStreet. CrowdStreet focuses mostly on individual real estate opportunities in 18-hour cities where valuations are lower and growth rates tend to be higher.
Personally, I’ve invested $810,000 in private real estate to earn more passive income and diversify my SF-heavy real estate portfolio. Real estate is my favorite asset class to build wealth, especially during times of uncertainty.
Author Bio: I started Financial Samurai in 2009 to help people achieve financial freedom sooner. Financial Samurai is now one of the largest independently run personal finance sites with about one million visitors a month.
I spent 13 years working at Goldman Sachs and Credit Suisse. In 1999, I earned my BA from William & Mary and in 2006, I received my MBA from UC Berkeley.
In 2012, I left banking after negotiating a severance package worth over five years of living expenses. Today, I enjoy being a stay-at-home dad to two young children, playing tennis, and writing.
Order a hardcopy of my new WSJ bestselling book, Buy This, Not That: How To Spend Your Way To Wealth And Freedom. Not only will you build more wealth by reading my book, you’ll also make better choices when faced with some of life’s biggest decisions.
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