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If I can leverage these further, I can grow my assets more quickly.....

2007-03-12 00:37:23 · 1 answers · asked by WhydoIdothis 3 in Business & Finance Personal Finance

1 answers

Retirement accounts can't be leveraged. Equity can by borrowing against it and investing it. Problem is, if the investment goes south, you could lose it all twice as fast...

If the stock market goes down and your margin debt gets called, you have to sell at the much lower price. In addition, even if the value is going down, the interest has to be paid on the loan. Same principles work for real estate... the loan may not get called but what if you can't get a renter or the value of the prop goes down?

2007-03-12 02:02:51 · answer #1 · answered by Father Knows Best 3 · 1 0

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