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Financing in Huson : Real Estate Advice

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Thu Feb 11, 2010
William Polack answered:
I have to agree with Mr. Mishra. Your IRA is not performing well now because it's buying stock at a lower price. When the market goes up, your investment will go up. Then it will go down again (you want it to go down). Again, the investment will pick up stock low and sell high and on and on. I would NEVER take money out of an IRA to put into a house that could burn down to the ground the next day and you lose all equity and your retirement. You will get hit with penalties and early withdraw fees and have to claim the amount as income (if it's not a Roth IRA) for next year. Consider the rule of 72: At a rate of 6%, your money will double every 12 years (72 divided by 6 is 12). So, $10,000 now is $20,000 in 12 yrs; $40,000 in 24 yrs; $80K in 36 yrs...and so on. I'd say to hold off on the small business until you can really afford it. If you're telling me that you have to lower your housing payments to open a biz, you need to get a biz partner or find a biz that's going to make more money in the forefront. Good Luck ... more
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