Why You Should Rent Even If You’re A Millionaire

All right, everyone, this episode is going to make a bunch of people angry. I think it's going to make a bunch of people angry. And here's why. So we're going to discuss renting versus buying. I saw recently on TikTok or something like that, there were so many people complaining that it's too expensive to buy a house and they're complaining about renting. And I've got a surprise. I think it's way better to rent and I'm going to explain my reasoning. And I know that on the surface, that's going to make a lot of people angry, but hear me out. And we have my friend Ramit Sethi. Ramit is famous for writing a book called I Will Teach You to Be Rich. He also has a famous Netflix show called I Will Teach You to Be Rich, and he gives his explanation as well. I think this might anger a bunch of people. Listen to the entire thing before you judge and then comment on YouTube. So go to YouTube and comment and let me know what you think. And by the way, I just looked at YouTube right now. 70% of people who watch our videos are not subscribed to our channel. That is ridiculous to me because we have a gentleman's agreement with this podcast. And what does that mean? That means if you've ever listened to more than one video or listened to more than one podcast, you need to go to YouTube, go to My First Million and click subscribe. We call it the gentleman's agreement because we can't track that you're actually doing it. But Shawn and I and people like Ramit, we make content for you all the time. And all we ask in exchange is just clicking subscribe. It means very little to you. It costs you very close to nothing and it means a lot to us. So please do that. And I hope you enjoy today's episode and let me, let me know what you think in the comments of YouTube if you agree or disagree renting versus buying. All right, let's get to it.

I feel like I could rule the world. I know I could be what I want to. I put my all in it like no days off.

On the road. All right, we're live. Rameed, so today I had you on because you and I are a little bit of an agree— in agreement on a few topics. One of them being that even if we think that you can afford it, which I'm sure we could, we could afford to buy a home, we actually prefer to rent. And most people, at least online and amongst even our friend group, think that that's insane. And I wanted to have you on to discuss kind of your opinion on buying versus renting, to discuss some of the numbers behind it. And we're going to get tons of comments. We're going to try and defend our argument against all of them before they actually come.

I don't need to defend it. I'm, I already know the answer. Like there's no defending, it's math. It's basic math. Here's my position. Let me state it very clearly because for the last 13 years I've gotten about 150 comments a day telling me that I'm stupid. And I think I turned into the Joker around 2012 when, you know, random people were telling me it never makes sense to rent. You're always throwing money away on rent. You're not building any equity. Equity is really important. And what are you going to leave to your kids? And on and on. I don't want to pay my landlord's rent, etc.

Well, and you actually do a funny job, by the way, of sharing the comments that you get on all your YouTube videos. Typically the comments are something like, land is always a good investment, or, yeah, you're not really wealthy if you don't actually own land.

Or like, people, people tell me that I'm poor because I don't own a house. First of all, that's actually quite insulting because not everyone can afford to buy a house. Doesn't mean you're poor just because you're renting. There are actually a lot of people who rent by choice, including me and potentially you. But anyway, let's— okay, here's my position. For the biggest purchase of your life, which for almost everybody is a house, you have to run the numbers because sometimes it's financially beneficial to buy, and other times it's financially beneficial to rent. And this, this should not be controversial. It's like very straightforward, simple, especially if you have lived in a high cost of living city, New York, San Francisco, LA. I've lived in all three cities. However, for some reason, saying that basic concept is like me telling everybody that the sky is green.

And by the way, you said sometimes it is, profitable. Sometimes it isn't. There's a third part of that sentence, which is also, who cares? Uh, like, that, that is an important thing when people want— so usually my take on this situation, I try my hardest never to use, um, certainty, like certain words. So I, I'll never say always or never. That's nonsense. That's crazy to say that. But usually my take is, or my take now is, historically In many cases, in fact, maybe even most cases, it is buying a home is not more profitable than renting. And what people say is, well, I shouldn't. So why are you buying a home? They'll say, well, because it makes me happy. Why did I buy a steak last night? You know, why did I do this other stuff? This, you know, it makes me happy. Yeah. My other point is that doesn't mean it's a horrible investment. I'm just saying compared to the alternatives, I actually think it's not great. And then, and people will say, well, but I made money on my house and this house I've done before. And I say, yeah, it can happen sometimes. Yes, it definitely happens sometimes. And particular, particular, and they'll, and they'll also say, so should I never invest in real estate? It's like, no, because investing in an apartment building or some type of development where it's the intention is cash flowing and the intention is number one investment, many times be a great idea, but Historically, if you look at the trailing 50 years of the S&P 500, of the average home growth, annual growth rate, and rent that is of equal quality, if you just run the numbers, I think more often than not, in fact, not sometimes yes, sometimes no, more often than not, it's actually not as profitable or it's less profitable to buy than it is to rent. Have you ever done like the historical math?

It's like 3.5%.

And by the way, I'm in the category where I currently own a home. I own my home now. I'm moving and I'm renting a house. I'm, I haven't decided if I'm going to sell my house or rent it out. I'm making that decision in the next couple of weeks. But if I decide to sell it, I'm actually going to have made a profit because I got very, I got very lucky and, uh, it just, it worked out now, but here's I gotta tell you something.

You said something the other day on Twitter that I really liked. You said, the older I get, the more I appreciate what role luck played in my success.

I think that it's okay to be lucky. It's actually great. Fantastic. Sometimes luck strikes, let's take it. Fantastic. But I also think super important to be honest about when you are good or when you are lucky. So I have a question for you because I've found that when people buy a house, they rarely want to rent afterwards. And so now you're going to rent. What does that feel like for you?

So I'm moving to a place where I intend to rent. I don't know how long I'll rent it for, 2 years, 5 years, don't know. And I wanted to rent a completely furnished home. And the reason being is I don't want— I didn't want to own much of anything. I didn't want to own a lot of stuff because I have a small house in Austin and it's 2,200 square feet. I have to fix stuff all the time and that's a small place. And I have historically rented for 3 months out of the year when I go to and visit family in New York. And I love it. I love being able to call someone and just say, fix this, please. Uh, it, it just, it, it brings so much joy that I don't have to like go and like find a vendor or like fix something myself. And so it feels like there's a burden lifted off, uh, a little bit of my shoulders. That's what it feels like.

Um, just from looking at you, I would have assumed you like to fix stuff.

I do like to fix stuff, uh, but only stuff that I like to fix. So for example, Like, I like to do Legos. That's fun for me. I like to work on old motorcycles, but I don't want to have to fix like an electrical thing in my home that it's reliant on. Like, I don't have light tonight if I don't fix this.

Okay, now looking at me, you also agree that I like to fix stuff too, right? A lot of tools. I— a lot of grime under my fingernails, right?

If I had to guess, You have never stepped foot in a Home Depot?

Only the last time I went was when my dad made me go, which I was probably like 11 years old.

Yeah.

My goal, my rich life is to never set foot in a Home Depot ever again. Ever. So far I'm 41 years old. I've done it. I think I can keep it going. Okay.

And so that's great that you know what you want. So when you're thinking of the buying versus renting thing, is what percentage of your equation is on math and numbers and what percentage is on emotion and happiness?

Can I— wait, let me ask you about those numbers. So for opportunity cost, do you assume 7.5%?

7%.

Okay, so you assume 7%. And then for maintenance, what do you, what do you assume? 2% of the property value a year?

I— in New York, yes. In other places, I would go lower, but New York is just inherently more expensive.

Okay. And then 8, and then in some buildings or, uh, apartment versus, uh, other stuff, you'd have HOA.

New York, correct? Like thousands per month.

Very expensive. Yeah, I, I have friends who have an HOA that's $5,000 a month. Uh, very expensive.

Yeah, that's totally normal in a high-end building in New York. Yeah, completely normal.

Um, all right, so you have opportunity cost, you have maintenance, you have HOA. Uh, what else do you factor in?

Transaction costs. When you buy and sell, it's a massive—

what's that, like 4%?

What do you use for the future growth? Do you use 3.5% annual growth?

Do you have a timeframe or like not a time? No. Do, do you think that maybe in the next 5 years you might, or is it just whenever you—

Probably, probably not in the next 5, but after, yeah, probably like after that. That's my guess. But when we go to make that decision, my goal with anything really important in my life is that I don't want cost to be the number one consideration. I don't want it to be number two or even number three. I want to have enough money that I can go and be like, that's what I want. It's totally irrational, but it's exactly what I want. And I don't really care what it costs.

Is your mentality— okay, so money is number three or number four. I think you said four or five on that list. So is your mentality going into buying a home, do you think it's going to be like I would like to not lose money on this, or if possible, I want this to be a store of value or something like that.

No, I will lose a huge amount of money. It will be the worst financial decision I ever make. It will cost me millions. It will cost us millions. I know that.

It's okay. Well, but you said that money, you said money's number 4.

So if it's number 4, I don't want it to be number 1, number 2, number 3. It's going to be like a distant number. Like, give me an example. My wedding, when my wife and I got married, I'd been saving for like over a decade, well before I knew her, because I knew, you know, I'm Indian, I want to have an amazing wedding and I don't want cost to be relevant at all.

You should have brought that up on your first date. Like, hey, I've been saving for our wedding, by the way.

That's not weird. That's not weird at all. That's what people often in the personal finance community want you to do, though. They're like, pull out your Roth IRA, show me your allocation. I'm like, can you guys go on a first date for once in your life, please?

Like, during dessert, you're like, what's your credit score? And by the way, can we go over our budget for our wedding?

You said that you want to be able to buy cash. Will you get a mortgage, or does that depend on the rates?

And, uh, I want to ask you about like your future home, like what, what you want to, what, like what the attributes will be. But when you are, does, does it factor in how often you're going to move? So for my rules for buying a home, the one of the rules I have is I want to live there for 25 years.

Dude, you and I agree on so much. Basically all of our podcasts are two bros agreeing with each other. Like, that's it. It's— I love it. Okay. I totally agree. When we go to buy a house, the general suggestion I give to people is you better plan to live there for at least 10 years. I think the same way, long-term. Let me explain the math behind it because this is quite counterintuitive as well. So we've all heard the phrase, you're throwing money away on rent. I go, how come you don't say the same thing when you go eat at sushi on Saturdays? You're throwing money away on sushi. Or how come you don't say you're paying your sushi owner's mortgage? How come we only use that real ridiculous sneer for a landlord? I don't care if a landlord makes money as long as I'm making money. Everybody can make money. It's great. In the case of buying a house and staying there and then moving in a few years, it's usually a really big financial mistake. Let me tell you why. I, I ran a quick calculation before we talked. Let's take the median house. It's like $417,000. Let's even be conservative. Let's say you put 20% down, which is pretty hard to do, but let's just say you do.

Do most people do 20% or less?

I think they do less, especially now because it's so unaffordable. That's a median price house. That's really expensive. Um, let's say you have 7.1% interest. I calculated with really good credit, but that's the interest rate right now, 7.1%.

Okay, listen to this. This is gonna blow your mind, everybody. You are paying more in interest than in principal for the first 20 years. Not 1 year, not 2 years, for 20 years. Only in year 21 are you paying more towards the principal than you are in interest. So in other words, for all the people who leave me hundreds of comments every single day saying, why are you throwing money away on rent? So dumb. So I just have one simple answer. I don't like to throw money away on interest.

Do you think that your opinion, and this is more so because I know you get these comments all the time and I'm recently in this category and I'm reflecting on how I feel. Do you think that your opinion would change if you had 2 or 3 kids?

Family definitely factors in for sure. That, in fact, I was gonna ask you how, how does family factor into your decision? But it's so interesting cuz you're choosing to rent right now. I love that.

That's amazing.

Yeah, it was a significant discount because we did a 2-year and then I called them and I go, look, like, I'm the, we are the perfect tenants because we are, we have stable jobs. We, uh, like we don't party. We, I've got a newborn. Like we are the, I'm the best possible tenant you could ever want.

But like, at what point did you say, by the way, have you ever heard of My First Million?

Never. I actually don't like bringing that up. Okay.

I have to tell you something. So my friends are always like, after my Netflix show came out, they're like, dude, so like, what's it like being famous? Like, You get into any restaurant you want. I was like, what? Like, what are you talking about? They're like, don't you have like your agents call and like get you into whatever? And I'm like, is this what people do? Because if so, I need to learn. I need to learn how to name drop My First Million and stuff.

I love that.

I used to want to buy a brownstone in Brooklyn. I thought they looked so cool. I rented one for a month and it was a lot of money and I splurged. And what I found is they stink. Like they're even the, like, for what my preferences, an old or a renovated brownstone is still an old building that things break all the time. And like, you hear the puff. And so like, I got to, I got to like test that out. You know what I'm saying? So I do that all of the time. Uh, when you're, when you're thinking about buying a place, what attributes do you want it to have?

I have a very, very specific and growing list because like I said, it's a luxury. So a luxury means you get exactly what you want. It's not about price. It's about getting exactly what you want.

How long is your list?

It's pages and pages. Bullet points? Yeah, just bullet points. Give me some. So we rented an Airbnb.

That's amazing, right? That we can test it.

Amazing. Amazing. And honestly, like a huge gift to be able to be like, oh, I can live in a different house that I would never have access to. And living there even for a week, you see things you didn't. So we rented an Airbnb one time and the owner was a chef.

Oh wow.

Well, it made a lot of sense because the kitchen was like extremely efficient. Like I found, I, I'm not in the kitchen a lot, but I found myself just enjoying being there. And it's because, uh, I later learned there's something called like the kitchen triangle or something. And it's like a highly efficient way of setting your kitchen up. And then I connected the dots. Oh, this is chef. So they knew what they were doing.

Like two dishwashers, things like that.

Exactly. Like it's all within reach. Yeah. So you're not wandering around. So good. Um, I also, you know, I love hotels. Yeah. Right. So every time I go to hotels, which I consider the best hotels have the absolute best designers, the best hospitality, the best thinking about what's going to make an amazing experience. So I go, for example, the best bathroom in the world that I've ever encountered is at Aman Kyoto. It's amazing. So what makes it amazing? Okay, first of all, so they have a beautiful mirror. The lighting looks incredible. The setup, huge counter space, beautiful hinoki wood right behind you. Toilet in a separate room. The Toto toilet alone I think is $20,000 and it looks like a spaceship. It's incredible.

Our friend Noah has one of those.

Oh, really?

That's cool. I think, I think so. It's like a really expensive, like, smart toilet, right?

Wait, yeah, yeah, hold on. Are you sure? Toto has like 20 models.

Well, I don't know which. I, I know that it was, uh, uh, like north of $10,000, and it has like a— whoa— and it has like a remote control.

Noah, okay, that, that's amazing. I did not know that. Wouldn't it be funny if we got Noah on right now? We're like, Noah, join this link right now. And then we're like, Noah, show us your toilet. And he's like, show you? I'm sitting on it right now.

No, it's It's a fancy toilet. And he, uh, he as a gift, he bought Neville one as well. A really fancy toilet. Wow. And so Neville had, and they have like remote controls enough that like Neville's family member came and visited and they were really intimidated because they were like, I don't know how to work this toilet.

It is a little, um, nerve-wracking for sure.

So you want a fancy bathroom, you want an efficient kitchen.

A couple other things. Bedrooms, small. I'm not interested in a huge bedroom. I don't want a couch in the bedroom. It's so irrelevant.

It's so dumb.

Dumb. Small. Um, I want a place to put packages because we get a lot of packages and I don't like seeing cardboard everywhere.

In the South, they call that a mudroom. You want a mudroom. A mudroom. That's what they call it.

I was like, whoa, dude. I interviewed this guy on Tuesday or Wednesday or yesterday or something like that. And he has a 25,000 square foot home. He was telling me, like, I was like, what's the expenses for that? He was telling me all the, all the answers and I was like, how much time do you spend a week like managing vendors? He goes like, yeah, he's like 15 or 20 hours a week I'm spending. He's retired. So he's like, I kind of like doing it because I don't have anything to do. Okay. And he's like, at the time I was divorced and remarried a woman who had a bunch of kids and I had a bunch of kids and it was cool to have. And then they grew up and they had kids. And so it's like, this is our compound that everyone hangs out. He goes, but now I'm trying to downsize. It's just too much work. I can't handle it. Yeah. And he's like, I'm just— he's like, I can't change the light bulbs. Like they're just like, because they're too high and I'm not going to get on a ladder. He's like, it's just way too much work. And so, because I was thinking about size, I'm trying to decide how big I want. I think I actually want like 5,500 square feet.

5,500 square feet?

Yeah. And the reason why I like that is because my in-laws can come and stay there and basically live and have their own room. And they could be with my family and it could be, and it's, and it doesn't feel like it's a burden that they're just living over there and they could work from the house. And I, and by the way, working from home is an ordeal now. Where like in plus I record for a living, so I would need a dedicated room for that. My wife needs— would like a dedicated room and I want space for in-laws and I have out-of-town family. I want them to be able to make themselves at home and not feel like they're a burden on me. And so that's kind of how I decided on my square footage is about 5,500 to 6,000.

Okay. I'll tell you what, I like that. It all kind of makes sense. You go, I need this, I need that, and then it expands. I think that also brings me to the list, the, it's not just about the house. So I went one level up cuz when, when, um, my wife and I moved to LA, um, one day I was like, let's go, let's go take a driving tour of the most expensive houses in the city. So I found like all the expensive neighborhoods and then we just drove around Bel Air, all these places. Most of them have huge gates, but you can kind of see through.

And, and you're talking like $100 million homes, $50 to $100 million.

Yeah, yeah, exactly. So I was like, ooh, write down that address. And we would look it up later. And sometimes there's photos. It's pretty cool just to see. And, um, as I was going through this, I, you know, while you're driving there for a minute, especially as an entrepreneur, you're like, I could live here. Ramit Sethi, Bel Air. You know, like you're like kind of falling into the vision. And then I got home and I was like, what the hell am I talking about? Like, I have a very small list of things that are absolutely important to me. And guess what's number one on that list?

Walkability.

The place that I rented, the, the second biggest reason why I did it was it's across the street from a weekly farmer's market.

I love that.

So simple. And I just like, I just want to eat like fresh vegetables and fresh meat. And that was like an ordeal was that it's just across the street from a farmer's market.

I love that.

And does this— when you're this methodical about buying a home, are you this methodical about all the other things you like to purchase on a daily or weekly basis?

Well, I think you should be this methodical for the largest purchase of your life. That's what blows my mind is people just literally buy a house and they spent more time researching their local steakhouse. I'm like, what? What? So no, I'm not as methodical. No, I don't spend years deciding, you know, what brand of chips to buy. But I do like a couple of rules that kind of make life simple. Like you, I don't want to have to, be consumed with stuff. I find that just like that older guy you mentioned, we buy stuff with good intentions, right? It's like, I worked hard, the American dream, I'm gonna buy a car, a house, et cetera. And then suddenly we blink our eyes and wake up one day and it's, we spend 50% of our time fixing stuff and repairing stuff and thinking about stuff. I don't want stuff. I find that sometimes when people buy stuff, their world shrinks. It's like, Oh, I gotta work on this, uh, the roof thing outside. You can see how little I know about houses. That's the only example. I'm like, the roof. And yet I want to expand. I want to be like talking to friends, traveling, trying new foods, doing my business. I don't want to be focused on a light bulb. That's not of interest to me.

Yeah, I totally agree. Wow. Amazing. I love those rules. I love how intentional you are that you just have them. I have to say that I think we kind of grew up fairly similarly, like socioeconomic, like similarly.

My, my mother was a teacher and my father was a small business owner and he didn't, yeah, he did okay, but that was when I was in high school.

Yeah. Okay. So, um, it's so interesting that often, you know, on my podcast I speak to these couples about money and sometimes there are trends that emerge, um, from different types of couples. So for example, one insight that is quite obvious if you ever listen is, uh, parents who have credit card debt can never say no to their kids 100% of the time. They have inability to say no to themselves, inability to say no to their kids. It's classic. Another one you'll find is that, um, people who have credit card debt, sometimes I'll be like, hey, pick up your computer and take me over to your closet. And they'll show me their closet and wow, is that intimate?

Well, you had a lady on your show that like was kind of, I don't know if she was broke, but she, she was in a money crunch and she had tens or hundreds of thousands of dollars of like purses and things like that.

Less quantity any day of the week.

Exactly. And they never say that. They say, I want more. It provides me memories, it shows me that I can get it, et cetera. So what, what I see is that class, money, socioeconomic status, they all intersect. And what you're talking about is so interesting because as you have made more money and you've kind of met people who have a lot of money, you also realize that when you go into their houses, there's a lot less stuff in there. And it is really fascinating and extremely taboo to talk about in our culture about how what you see in someone's house actually tells you a lot about who they are, their identity. It is so revealing. Yeah.

And it creates huge amounts of headache. This isn't just a financial thing. This is a, like, um, I think that, like, usually the desk where I work, I need it to be clean. Um, I think you said something, you said something like, um, you're like, I love beauty. And if I surround myself in my home or my office with beauty, I feel inspired and I feel more productive. I don't need beauty. I'm not inspired by like particular paintings and things like that, but I need it to be clean. I need it to be clutter-free. So the desktop on my computer, it all is always empty and it's just white space.

And I like that. You know, there's this quote, luxury is that which can be repaired. And it strikes me when you talk about, you know, reduce and reuse, same exact thing. One, one example I shared that people went berserk over, they loved it, was I have these shoes, tennis shoes, and the company that I bought 'em from, they're expensive and they do free repairs.

So— What's the name of the company? That's pretty cool.

It's Brunello Cucinelli. It's a high-end Italian brand. And basically anything at, at, at these like high-end brands, if it ever breaks or gets frayed or anything, you take it in, they'll fix it for you. No questions asked. There's no cost. But it's very expensive on the front.

How much are shoes there? I know the brand, but I've never looked at their shoes.

Well, I think those tennis shoes are like $700.

It's a lot.

But yeah, but, you know, it's not really this service. They're doing it as a courtesy to me. Really, they want you to bring in your $11,000 coat.

Got it.

Which you've had for 25 years, and they'll send it back to Italy where only they know how to perfectly repair it, and then they'll ship it back.

That's awesome.

Which Yeah, it's amazing, right? So I posted this and I showed my shoes. I wore some of these shoes on the show and I really like to, you'll see me in sometimes the same outfits a lot because I wanna wear my stuff. I buy it, I spend on it, and then I wanna wear it. I don't wanna just throw it out. So I took these shoes and I took 'em to the store and they were like, yeah, no problem. And it took months. So the other thing about buying nice stuff is that you're often not gonna get the speed that you would get if you order from Amazon Prime or something else. Like you go to H&M, you're, you're buying it right there on the spot, you're tossing it, et cetera. But, uh, or another fast fashion brand, I should say. But for this, it's like months away. Anyway, people loved it. They loved the idea that, oh my God, free repairs, free repairs. Where'd I get stuff repaired for free? What they don't love as much is spending on quality in the first place. Mm-hmm. Right? It's not about the free repairs. Like, I can afford to get shoes repaired, so can you. But I think I like your mentality of like, I'm going to be selective about what I buy and not just buy quantity, but really think about what's meaningful to me. I think that's really cool.

Yeah, it's— I think it's exhausting. I remember as we're preparing to move and I'm thinking like, all right, so we're going to spend money to ship this. And I'm like, but I don't even want this. Like, I don't even want to— why? Why am I— I don't even— why do I want to ship this thing that I don't even want? Like, it's kind of ridiculous.

Yeah, it's, I, I like how you kind of stop it before you even get it in the door. Like you're like, I'm not even gonna get Amazon Prime. But I also think that once you have it in the door, if something's in your house, you can also, like I do a quarterly closet cleanse. That's in part 'cause my wife is a personal stylist, so she's taught me how to always cleanse. And, um, it's just nice to get things out and it frees up mental space. You know, when you open your closet or when you open your office or even your kitchen every day, I want to feel good. I want to open the fridge and things are in order. I don't want to feel chaos like by 7:30 in the morning.

It's really challenging though, by the way, to throw away stuff. Uh, it's like a— it— I used to make— I, I read that I, I would make fun of like, uh, the Hoarder TV show. I'm like, how are these people so ridiculous? Uh, and then when you go through that process of actually cleansing out and, and cleaning it, it— I don't know if it impacts you. It impacts me. I get emotional. I'm like, oh, but I've owned this thing for 15 years even though I've never used it, it's actually— it is, uh, it is hard. And so I don't want to get into that rut.

Yeah, I agree. I mean, I, I don't have an emotional thing, but I do have a problem with piles. Like, I get stuff and I just put in a pile, and then I like never get to the pile, sometimes for years. And it's just like, why am I doing this? Like, that's the one thing I really need to improve on as it relates to cleanliness, because I'm like, these piles do not look good. They don't feel good either.

So for the listener, the takeaways in all this. So we talked about running the math. You get criticized online all the time, and I think it's nonsense because all you're saying is run the math. That's all you're saying. And don't do— and even if it is unprofitable, do it anyway. But don't kid yourself and say that it, that it's a good investment.

Yes, you can totally. If you like, I have a friend, they lived, uh, they, they moved to New Jersey. New Jersey, notoriously high taxes. And they were like, hey Ramit, we ran the numbers, it makes no sense, and we're buying anyway because of schooling and because of location to work. I go, fantastic. I gave 'em a round of applause. Good job. It doesn't matter to me if you buy or rent. It only matters that you're actually calculating everything. Math is one part of it. You need to know your numbers, but also there are other things, family, uh, you know, just pure desire, anything you want, but you gotta calculate it all. You cannot simply say, Uh, like I want, like, it's hilarious to me that so many 24-year-olds on Twitter are like, my number one goal with money is financial freedom. And then they spend 630% of their net worth on a 30-year mortgage. It literally makes no sense. You need to be sure you're actually using your money to live your rich life. And part of that is calculating carefully the biggest purchase you'll ever make.

And I for— I wanted to ask one last thing, which is, Amongst your friend group, is there a difference? Is there a pattern that you've known amongst people who earn a significant amount versus those who don't? Like, I have a bunch of relatively high net worth friends who actually rent and—

Yeah, same.

Have you seen a pattern in that?

All right, man, we're going to wrap up there. I appreciate you doing this. This is awesome. I'm— if you're listening, I want you to go to our YouTube page, type in, you know, if you're listening on podcasts like Spotify or iTunes, Go to our YouTube page. So, you know, type in My First Million, find this episode. I want you to put a comment if you agree or disagree with us. Oh no. I'm very curious. And by the way, be nice. Be nice about it.

All right. That was very nice of you to say. Thank you, Sam. Let me tell you something. Um, you can always recognize someone who has never been to a high cost of living city by the comments they leave. I had a guy, this just happened like 2 days ago. He goes, for me, just such an idiot. Um, I. I make more money owning, it's so much better, et cetera. And so I, you know, I like to talk to people, I like to ask questions. I say, tell me more. And I have this like very long conversation with him. He bought a house for like $75,000. Okay. He lives in a very inexpensive city. So in a city like that, it actually makes a lot of sense. Here's my, here's my simple request for anyone leaving a comment before you leave a comment. I want you to look up properties in Palo Alto or Menlo Park, and I want you to look up those properties and I want you to find a couple properties that have rented and have sold. And I want you to understand the math of a really expensive city like Menlo Park and Palo Alto.

You could do that with like Chicago as well, or Atlanta. Like, I bet you right now the numbers would actually still tell you the same story.

You're totally right. You're totally right. I just want to show them like all the way in the most expensive cities in America, because I want you to see that it is true in some cities, it will never make financial sense even after 30 years to buy. And then once you understand that, you go, wait a second. So if that's true, then what about Chicago? What about Atlanta? What about my own city? Let me take a fresh look at this. And that's when you really start to master money. When you take all the preconceived notions you have, you go, ah, maybe that wasn't true. Let me analyze it for myself.

That's awesome. I appreciate you. And that's the pod.

I feel like I could rule the world. I know I could be what I want to. I put my all in it like no days off on the road. Let's travel. Never looking back.