Millennial home-ownership is at a record low. There are a lot of reasons why millennials aren’t prioritizing home-ownership — from lifestyles that differ from previous generations, to affordability and lack of housing options.
While some experts have insisted that millennials should continue to rent rather than buy a house, David Bach, the co-founder of AE Wealth Management and self-made millionaire, warns millennials that not prioritizing home-ownership could cost them in the long run.
“The most important advice I can tell you right now if you’re young is: Don’t listen to these people that tell you should rent versus buy.” Bach told CNBC. “Buying a home is the escalator to wealth in America. Homeowners are worth forty times more than renters.”
The math is pretty simple: You have to live somewhere, so why not invest in a home? It takes some time, but eventually you’ll own that home outright.
In his new book, The Automatic Millionaire, he points out that renters “can easily spend half a million dollars or more on rent over the years,” and at the end of it all you end up with nothing.
Or you can use that same money to pay down a mortgage and after 30 years you will own a house.
Who do you want to be rich, you or your landlord?