Here we are at Round 3, Round 2 went to “REAL ESTATE” due to the tax benefit blows against the stock market compared to real estate. It was closer this round than in round 1, but real estate still took the round. You can see a replay of Round 2 here.
We are addressing the question of the never ending battle in many peoples minds. Should I pull my money from the stock market and invest in real estate in Colorado Springs or should I sell my Colorado Springs real estate and invest in the stock market?
We are assuming that someone has $50,000 in the stock market and asking that question.
There is one thing we should consider when investing that we have never considered before in the history of our nation. That is the question as to how well our investments stand up to inflation, the declining dollar and possible economic calamity. The stock market in the past has been a relatively safe bet, however with our ever changing laws, regulations and the expansion of government we must consider this when investing. Our dollar is losing it’s value. When inflation deteriorates its value, it takes more dollars in which to purchase anything. In other words, a loaf of bread could double and triple in price very rapidly.
We must also consider when investing in stock, we are investing in potential profits of companies. These companies can close in bad economic times and/or lose profits in a big way. Company loss can cause the value of our stock to decline. There are some safer bets when investing in mutual funds, but that is only in the way of diversification. If you have saved your entire life a million dollar retirement account earning 12% on your money, yet inflation exceeds the growth, your retirement value will be in dire straights. Maybe you can use that million dollars to go buy a loaf of bread, but that’s about it.
If there is some sort of catastrophic event and the dollar becomes worthless, money in any stock investment is wiped out.
REAL ESTATE INVESTMENT
With real estate investing it is a different story. If you owe $100,000 on a home and the dollar inflates, your home will be worth much more than you owe, rents will be gigantic and yet……you only have to pay off a measly $100,000 which may be less than a loaf of bread.
If there is a catastrophic event in which currency is worthless, real estate is a tangible asset that provides a roof over someones head. Everyone needs a roof over their head. In this case, one could barter for food or supplies for rents due. The home structure itself is still valued at whatever currency is available at that time.
Now, I know that these are highly controversial statements and way out there in regard to whether you should invest in Real Estate or the Stock Market, but the US has never gone through any type of correction like most other countries have gone through. In this day and age when the country is trillions and trillions in debt, one must consider all scenarios.
So, given these very basic scenarios, who wins Round 3? Real Estate or Stocks?
How can anyone really debate it? It is a total KNOCKOUT!
“Own Real Estate”