BiggerPockets Money Podcast

540: Renting vs. Buying a Home in 2024 and Do You Have Enough in Your 401(k)?

Jun 25, 2024

Certified financial planner Kyle Mast and host Scott Trench discuss the renting vs. buying a home debate in 2024, managing savings and investments with high interest rates, strategies to boost retirement savings, and caring for aging parents. They tackle these financial hot topics with insights on wealth accumulation and planning for the future.

50:51

Episode guests

Kyle Mast

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Episode notes

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Quick takeaways

Renting can be cheaper than buying due to high interest rates, prompting considerations for allocating savings to investments.

Disparity in 401(k) balances emphasizes the need for wealth-building strategies and exploring investment options for comfortable retirements.

Elevated interest rates require individuals to reassess investment strategies for stable returns, highlighting the importance of proactive decision-making.

Deep dives

Renting vs. Buying: Affordability and Strategies in High-Interest Environments

In a debate on renting versus buying, it was found that renting a home was considerably cheaper than buying in some major metros due to high interest rates. Strategies such as stockpiling cash and optimizing investments were discussed to navigate this challenging environment, emphasizing the importance of long-term planning and regional market variations in making such financial decisions.

Intro

3min

Renting vs. Buying: Financial and Emotional Considerations

8min

Maximizing Wealth through Creative Housing Strategies

5min

Navigating High Interest Rates and Economic Uncertainty

11min

Analyzing the Average 401k Balance and Retirement Concerns

5min

Retirement Savings and Part-Time Work in Retirement

15min

Discussing the Importance of Preparation and Creating Optionality in Financial Planning

3min

Renting vs. buying a house: when it comes to FIRE, many people assume that you must own a home and preferably have it paid off to reach financial freedom. But is this really true? With renting so much cheaper than buying in 2024, would it be wiser to rent a place and send the savings to your investment accounts? Today, we’re tackling this topic and a few other heavy hitters as we give our takes on four of the hottest financial headlines.

Kyle Mast, certified financial planner, joins Scott Trench to share FIRE-first thoughts on these not-so-easy-to-answer questions. First, we give our take on the ever-relevant renting vs. buying debate and ask whether things have changed since high mortgage rates have made buying a home much more expensive. Then, how do you manage savings and investments with interest rates so high—should you keep your money in a high-yield savings account or search for better opportunities even with savings yields so high?

Think your nest egg is a little too light? We share the average 401(k) balance for those close to retirement and give our strategies to boost retirement savings before you leave full-time work. Finally, for those struggling to take care of elderly parents, our last headline is for you. We talk about the growing number of Americans physically, mentally, andfinancially caring for aging parents and how you can set yourself up in the best position possible to care for those in your life.

In This Episode We Cover

Buying vs. renting a house in 2024 and whether homeownership is required for FIRE

The best housing investments you can make to propel your net worth and savings rate

Saving and investing during higher interest rates and the type of “opportunities” you must be looking out for

The shocking average 401(k) balance and what you can do to increase income in retirement

How to ensure your children DON’T have to financially care for you in your old age

And So Much More!

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