Some of the worst financial advice I've ever gotten came from men over 50.
They meant well. That's the thing. But a lot of what older guys hand down to men in their twenties and thirties was solid in 1985 and stopped being true today. The one I heard most went like this.
I've heard some version of that my whole adult life. It might be the most repeated money advice in the country. And for where I sit right now, it's just wrong.
I left my corporate job in September 2022 to build companies. Since then I think about money differently than I used to. So let me walk you through why I rent, and why I plan to keep renting for a long time.
I can leave whenever I want
Start with the thing nobody bothers to price. Flexibility.
If I want to move next year, I give 60 days notice and I'm gone. I don't have to list the place, stage it, or sit through months of showings hoping the right buyer turns up before the market turns.
My whole life right now runs on being able to move when I need to. A new deal pulls me somewhere, I go. Renting keeps me light. The day I sign a mortgage, I'm anchored to one zip code and a decision I made years earlier.
Rent is cheaper. Every single month.
Here's the part people get backwards. They assume renting is the expensive option.
And I'm not talking about the starter place you grab for a couple of years. Picture the house you'd actually want to own. The one in the good neighborhood with the schools and the big trees, the home you'd still be happy in ten years from now. Call it $2M.
Twenty percent down is $400k in cash on day one. Finance the other $1.6M at today's rate, around 6.6%. Add property taxes near $25k a year (way more in Florida - for now), insurance at $5k, maintenance running another $12k or so.
All in, owning that house lands around $13,500 a month.
Renting the same house? Closer to $8,000.
I'd pay roughly $5,500 more every month to own it. That's $66k a year. And that's before the $400k I had to wire over just to get the keys.
Here's what most people don't see. That gap gets wider the nicer the home gets. In the expensive areas, the ones you'd actually want to raise a family in, rents stay low relative to what the houses cost to buy (yes, inventory in those areas can be hit or miss for rentals.) The price-to-rent ratio sits firmly in the renter's favor. A $2M home almost never rents for anything close to what it costs to own one. And that's exactly the kind of house most of the people reading this are eyeing.
Now flip it. Buy a modest house in a cheaper market and the gap tightens up fast. Owning and renting end up costing about the same month to month. That's where buying earns its keep, because the mortgage forces you to save without ever deciding to. Every payment knocks down the balance whether you felt like saving that month or not, and for a lot of people that's the only reason they ever build any net worth at all.
That's a real benefit and I won't pretend it isn't. It's just not the math I'm running, and probably not yours either if you're this far down the page.
That $400k could be working
Which brings me to the part that actually keeps me renting. The opportunity cost.
The day I wire that down payment, it's frozen. I can't touch it. I can't move it when something good shows up. And something good always shows up. I run an investment firm. Right now I'm buying paving companies with a partner. Every dollar I keep liquid is a dollar I can put into a deal that pays me back.
$400k sitting in drywall earns me nothing while I live there. That same $400k compounding at even 10% turns into real money fast. That gap is the whole reason I rent.
Now run it out ten years
This is where it gets fun. Play both versions forward a decade.
I put $400k down and pay around $13,500 a month to own. The renter pays $8,000 and invests everything left over. That's the $400k that never got locked up, plus the $5,500 a month they're not handing to the bank. We spend the exact same amount out of pocket. The only thing that changes is where the money lands.
Say it compounds at 10%, roughly what the S&P has averaged for decades.
After ten years the renter is sitting on about $2.1M, all of it liquid. The owner has maybe $1.4M in equity, and that's assuming the house appreciated the whole way, and it's locked up tight. Pulling it out means selling the place and paying to do it all over again somewhere else.
Same money in. The renter comes out around $700k ahead, and every dollar of it can move.
Now here's the part that gets me. That $2.1M is enough to walk up and buy the $2M house in cash. The one in the good neighborhood. The one I actually wanted the whole time. Paid for, with money left over.
That's the whole play. Rent now, invest the spread, and a decade in you buy the house you actually want outright, on your terms, when you're ready.
And selling costs a fortune
Now say I buy anyway. A few years in, something changes and I have to sell.
Realtor commission, closing costs, transfer taxes. On a $2M home that's easily $120k to $160k, gone at the closing table. I'd need serious appreciation just to climb back to even after everything I already paid month to month.
Unless you're planting roots for ten years or more, the math rarely gets the time it needs to work. And appreciation isn't a sure thing anymore. Texas and Florida have already turned into buyer's markets.
Here's where it gets complicated
Everything I just told you is true. Renting is cheaper and it keeps my money free to move. By the numbers it isn't close.
And I'm still going to buy a house one day.
A home was never really a math problem. There's something a spreadsheet can't hold about a place that's actually yours. Where your kids grow up. Where the door is the color you picked and nobody can tell you to leave.
I'll go further than that. Someday I want a house that's paid off all the way. No mortgage. Nobody to pay.
Every principle I just laid out says that's a bad use of money. A paid-off house is a couple million dollars sitting idle, earning nothing, when it could be out working. I know that better than almost anyone. I've built a career on knowing that.
And I still want it.
There's a peace in owning your roof outright that no rate of return really touches. The business can go sideways and the market can drop, and the house still stands and it's still yours. I've watched what that security does for people. It's worth a lot.
So that's the honest version. I rent because it's the smart move, and it'll stay the smart move for a long time. Then somewhere down the road I'll buy, I'll pay it off, and I'll do it with my eyes wide open, knowing every number on the page says don't.
Now I want yours. Hit reply and tell me the worst money advice anyone ever handed you. I'll go first.
— Sam Silverman
Silverman Capital
