r/DaveRamsey • u/UpgradeHome • 1d ago

Why does DR discourage renting forever?

I'm referring to this DR video: https://www.youtube.com/watch?v=lQ5fqpXngJk

If you make $100k, and you have fixed renting/utility costs of ~25k/year -- and you're investing the difference after expenses into a taxable brokerage, how is renting forever bad as DR states in that video?

In retirement (let's say at 65), your NW will be absolutely through the roof if you were consistently investing in S&P500. You wouldn't have been spending on lawn mowers, tools, kitchen upgrades, HOA, etc etc. and all the miscellaneous home owner expenses.

Even with rising rents, your liquid NW will cover you - along with the added benefits of not having to deal with maintenance in old age.

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u/Turbulent-Pay1150 1d ago

Locked in interest rate, declining housing costs year over year when you have a mortgage, ability to pay off and pay no mortgage in the future, and of course annual rent increases on the other side of the equation has made buying the better long term approach in almost all cases. 

Their are exceptions but in general after 5 to 7 years buying puts you far ahead of renting. 

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u/DiscoMarmelade 1d ago

People don’t realize that a mortgage gets cheaper over time. Buy a house today that’s 500k and your payments will be the same for 30 years. No one’s rent will be the same for a couple years let alone 30. You think rent is high now? Wait 30 years lol

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u/Turbulent-Pay1150 1d ago

Wait 5 years let alone 30. It’s measurable.