Another approach is forego home ownership, plan to rent instead, and keep your capital in investments.

I have known people who did this. You avoid debt, for one thing. They figure the cost and bother of maintenance, and the tying up of capital, as well as pricing where renting is cheaper than buying, justifies this stratgy. Others do not wish to look at their residence as an investment, capital, etc, but put a higher value on the security of owning.

Actually, Ben Graham lived in rented housing all or most of his life, IIRC. Graham is the father of investment analysis, who wrote the book(s) and taught Warren Buffett the trade.

I had a supervisor who did this. He would never own his own home. In San Diego, where it was cheaper to rent than buy most of the last 50 years, he cited many examples. He was older, lived with his wife, kids either grown or out of the house, etc.

How bout if Ford goes to $18, $27 or $39? It's been there before. What kind of interest/profit have you made then?

quote:

Originally posted by doublesharp:
How bout if Ford goes to $18, $27 or $39? It's been there before. What kind of interest/profit have you made then?

How bout if Ford goes to $2, $4, or $6? It’s been there before. What kind of interest/profit have you made then?

What might cause that? Dividend cut might do it.

It is speculative. If it works out, you are golden. If not, well, you can dream, I guess.

Remember, an investment is a speculation which worked out well, while a speculation is an investment which did not.

quote:

Originally posted by JALLEN:
Another approach is forego home ownership, plan to rent forever...

I don't want to keep a day job when I'm 89. Sure, I could pick a few stocks with untapped potential with one ridiculously easy trick. I don't look at my residence as an investment, I look at it as mine. It doesn't belong to someone else. It doesn't belong to a bank. When the water heater died, I replaced it in a few hours myself. Being debt free was my ultimate goal, I wish the best of luck to anyone else trying to achieve such a thing.

quote:

Originally posted by mikeyspizza:
Ford's dividend is 60 cents a year per share, and shares are about $10.

For $100k, you'll get 10,000 shares.

10,000 x 0.60 = $6k per year in dividends, or $500 per month, minus taxes.

All subject to the performance and risk of one company, whose recent performance does not inspire confidence.

Pay off your house.

JAllen knows what he is talking about. One would be wise to listen to listen to his experience.

I'd put the money into the house purchase. Without a mortgage payment, (or even a much lower one) you can use the monthly increase in freed up cash to then buy stocks or invest with.

Stocks can go up or down at a whim, but you always need a place to live, and a mortgage payment always has to be paid every month, even if you lose your job. You could bag groceries at the local grocery store and be able to pay the bills in a normal, paid off home.

Here in Florida you pay an extra 5% of the sales price of the home if you buy it with a mortgage between doc stamps and the other associated fees, closing costs are around 6% on a purchase with a mortgage......if you're paying cash they're right around 1% of the sale price.

I’d suggest you look at investing in several, rather than one stock. Look into REITs, especially healthcare REITs. You can get dividends 8%-12%, plus good historical annual growth.

While I'm enjoying the stock/dividend discussion...pay off the house!!!!

Then, invest what would have been the monthly mortgage payment in the market if you want.

quote:

Originally posted by Strambo:
While I'm enjoying the stock/dividend discussion...pay off the house!!!!

Then, invest what would have been the monthly mortgage payment in the market if you want.

Do it each month. Dollar cost averaging will almost always beat making a lump sum buy and hope you are timing the market correctly.

You want dividends? Try the REM ETF. I make no comment on equity growth.