UnThreaded | Threaded | Whole Thread (39) | Ignore Thread Prev | Next
Author: sykesix Big gold star, 5000 posts Top Recommended Fools Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: of 63243  
Subject: Re: Re-Balancing Your Portfolio Date: 2/9/2007 1:41 PM
Post New | Post Reply | Reply Later | Create Poll Report this Post | Recommend it!
Recommendations: 5
I think that is where the 100% safe part comes in.

It is by far from 100% safe. The problem is that money in your house is difficult and expensive to access. And the money doesn't become "safe" until the mortgage is retired. Remember, this is your statement:

The very bestest use of funds is to first pay off all debt.

Let's assume you've been using your investment dollars to first steadily pay down the mortgage when you get laid off or get sick or otherwise can't work for an extended period. If you miss a couple mortgage payments, the bank will foreclose. And when you point out you have made extra payments, they will laugh heartily and foreclose anyway, and you lose all the extra payments you made, your down payment, your house, and your equity. That is about as safe as a cheese enema.

On the other hand let's you have been using your investment dollars to first fund an index fund when you get laid off or get sick or otherwise can't work for an extended period. Then you simply tap the fund to live on until you get back on your feet.









Post New | Post Reply | Reply Later | Create Poll Report this Post | Recommend it!
Print the post  
UnThreaded | Threaded | Whole Thread (39) | Ignore Thread Prev | Next

Announcements

Foolanthropy 2014!
By working with young, first-time moms, Nurse-Family Partnership is able to truly change lives – for generations to come.
When Life Gives You Lemons
We all have had hardships and made poor decisions. The important thing is how we respond and grow. Read the story of a Fool who started from nothing, and looks to gain everything.
Post of the Day:
Macro Economics

Looking at Currency Ratios
What was Your Dumbest Investment?
Share it with us -- and learn from others' stories of flubs.
Community Home
Speak Your Mind, Start Your Blog, Rate Your Stocks

Community Team Fools - who are those TMF's?
Contact Us
Contact Customer Service and other Fool departments here.
Work for Fools?
Winner of the Washingtonian great places to work, and "#1 Media Company to Work For" (BusinessInsider 2011)! Have access to all of TMF's online and email products for FREE, and be paid for your contributions to TMF! Click the link and start your Fool career.
Advertisement