I agree that your personal home is not an asset. The majority will disagree as to many, especially to the middle-class, it is their biggest investment and plenty emotions are tied to their home. Emotions lower financial intelligence.

All I want to suggest is that when people look at their balance sheet not to put their home on the asset side and see if they will still come up with positive equity. You could consider your home as a bonus on top of that if you really want to qualify it as an asset.

Most people will see a deficit if they don't put their home on the asset side which is where plenty of financial problems come from.

Your home is intended for you to live in and that's it. It's not meant to be an ATM or anything else. Use it for the purpose it was intended.

To consider your personal home as an asset is the biggest illusion of wealth.

So you are basically saying to not buy a house until your assets are significant enough to be able to balance the debt? So until I have $300,000 in other assets I should not purchase a home for $300k? Preposterous!

Basically, you are saying that since the home is tied to emotions, its value is $0 (even though its intrinsic value is otherwise), and therefore your financial picture in the form of a balance sheet would look very bad with a $300k debt and a $0 asset. This is all even though my cash flow can more than handle the monthly mortgage payment of the debt.

To consider your personal home as an INVESTMENT, is wrong, and that I agree with. But to not consider it an asset is a bigger illusion. If this were true, it would always be better to rent a home than to own one. A mortgage on a personal residence can provide a significant tax break, and is some of the cheapest money you can borrow. You can secure equity with an equity line and use it for emergency purposes. Later on, you can consider a reverse mortgage, renting it out, or selling.

Secured debt is not the same as unsecured debt, and they are treated very differently. You are basically suggesting that a mortgage should be looked at as unsecured debt which is preposterous.

One of my clients retired in 2005 and had no 401k money, about $100k in bonds, and her home. She sold her home for $3 million through a trust, bought a small place near her grandchildren, and will have the income she needs for the rest of her life. So much for her personal residence not being an asset!

I never said not to buy a home until your balance sheet can handle it because you don't pay cash for your home but you should wait until cash-flow from your assets are in excess of what the monthly mortage will be.

Your balance sheet will look bad but eventually the balance sheet may improve.

If you have sufficent assets you would not need to take out and secure a credit with your home. All you do with a home equity line of credit is you take on more liabilites on something that you don't own in the first place and that is ridiculous.

You mentioned an example of where the home was converted into an asset but it only became an asset after you converted it. There are plenty of examples when that was not the case. I don't want to suggest that home-ownership is bad it is a very good thing but the approach of home-ownership which the majority chooses is bad.

This is like- fate! I started surfing the web days ago after I consulted with a debt counselor last week. I am a professional with a graduate degree and own my own home. I have excellent credit. I am divorced, no children. I got into the credit card rut because I am a social worker and simply do not make much money. (And obviously fell prey to having to own certain things, I admit.) I am about $30,000 in credit card debt and have been playing the card transfer game. I decided to see a debt counselor and after about 4 hours of brainstorming and tweaking, her advice was this: Keep my mortgage payments current, pay off my car with a credit card, continue to pay on two of the cards and keep them for ER's. And blow off the other 5 credit card companies. All they can do is harass you and ultimately, just lower your credit rating for 5-6 years. So, I'm getting that if I just have thick skin and can handle a few phone calls and strongly worded letters, not much will happen to me? Count me in!?

Not exactly true Minerva. They can take you to court, win a judgment against you, then garnish bank accounts and wages. If you own a home, they may even get a lien. In civil court, half the battle is getting the judgment, the other half is collecting it from you.

I hear it a lot on the radio too. That's why I looked it up.

Let's put it this way: the few posts that tell how wonderful the program are from then-new posting members with one positive message. Where and whey did those new members come along?