People like to stick with what they know.
Your home may be your most valuable asset, but that doesn’t mean it’s your best investment, according to the CNBC commentator and co-editor of the new book “How To Invest My Money.”
And the equity in your home can be misleading.
“It’s really a form of consumption. You own the house instead of paying rent on a house you don’t own, but you have to live somewhere,” Brown said.
You should view your home as an emotional investment. You spend money on it because it makes you happy, Brown said.
Once you start doing the math about home ownership, you’ll find that after decades of inflation, repairs, and renovations, you have an asset that is lagging behind the market, Brown said.
As you invest in more real estate, those returns can get worse.
That doesn’t mean real estate can’t be part of your portfolio. To capitalize on real estate, Brown invests in real estate investment trusts, or REITs.
REITs allow an investor to own shares in a publicly traded company that owns income-generating real estate.
Check out this video to learn more about the REITs Josh Brown invests in and to learn more about the wealth adviser’s real estate philosophy.
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Disclosure: NBCUniversal and Comcast Ventures are investors in Acorns.