Home Equity has a Zero Rate of Return
For over 35 years I have been a Financial Strategist and Retirement Specialist. I have educated my clients and students as to why the equity in a home has a zero rate of return. As of this writing, with many home values down, many people now “think” that they understand this concept. I am not talking about the loss of the money trapped in your home. Rather, I am trying to explain that home equity is really lazy, idle dollars earning a zero rate of return.
Watch this 5 minute and 32 second video as Doug Andrew graphically portrays the subject using the “pitcher and goblet.”
Once I present this visual to my clients they “get it” and never leave equity in their homes ever again.
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