This piece is part of my 2016–2026 archive migration. Some original formatting, content, and external links may be missing, changed, or not be optimized.
Houses Are Liabilities Until They MAKE YOU MONEY
It’s erroneous to believe your house is an asset if it’s not paid off or making you money.
What Counts As An Asset?
An asset is something you own outright or putting money into your pockets.
Assets do not detract money from your bank account. They beef up your bank accounts.
Homes Come With Expenses
The core four housing expenses include:
Taxes
Utilities
Insurance
Maintenance
You can’t get away from them.
You could try to get away without maintenance, but that will ultimately deteriorate the home value and the quality of life you have in it.
If you’re trying to build your net worth and savings, re-consider the home purchase if you don’t have an emergency fund, don’t have a stable income, only have one consistent source of income, or can’t afford the additional costs that come with a home.
Reframe The Negative Perspective On Renting
Many people think renting is a waste of money.
Well, is it?
If your lifestyle is conducive in that renting saves you money versus the additional money a home might cost, renting is the best choice.
There are many financially successful “renters” roaming the universe. Owning a home doesn’t give you your financial black belt.
Buying A Home Is Just “Advanced Level Renting”
Instead of paying rent to a landlord, you now pay rent to the bank for 15–30 years, and once you make enough payments, you can have the property.
If you think about it, buying a home is renting a house for 15–30 years.
You might have signed the papers, which might “look” like it’s in your name, but the bank can rip it away if you miss enough payments.
A home is only yours or an asset once you make that final payment or get someone else to amortize your mortgage and yield a profit.
Before The Home Purchase
It’s easy to pull the trigger on your new HGTV dream home. But before you jump off the ledge, ask yourself if you can handle adding that level of liability to your financial situation.
You can always sell or abandon the home if you need to eradicate the liability, but why over-stretch yourself in the first place if you don’t have to?
Do you even need a home, or can you make it without one?
If you decide to buy one, don’t think of your home as an asset until one of two things happen:
The home gets paid off.
The home reels in income.
Without one or both of these things, your home essentially subtracts money from your pockets, just like renting does; it’s all the same.
This content is for informational purposes only — not professional advice. Consult a qualified professional before making any major decisions.