May 25 2010, 11:47 AM
QUOTE(ericpee82 @ May 19 2010, 01:28 PM)
Base on this cash flow chart, that said
rich man cash in FD -> 100k
poorman House loan BLR -> 100k
after 30 years
rich man cash in FD --> 209k (base on FD Rate 2.5% p.a)
poorman House loan BLR -->216k (jz finished paid loan)
The calculation is nonsense. You are comparing different asset classes. Try the calculation below. rich man cash in FD -> 100k
poorman House loan BLR -> 100k
after 30 years
rich man cash in FD --> 209k (base on FD Rate 2.5% p.a)
poorman House loan BLR -->216k (jz finished paid loan)
Rich Man cash invested in property -> 100K
Poorman House Loan BLR -> 100K
After 30 Years
Rich Man Net Worth -> 216K (property @ 2.6% appreciation) + 189K (net rental @4% yield) = 405K
Poor Man Net Worth -> 216k (property @ 2.6% appreciation) = 216K
So the rich man wins after all.
This post has been edited by gark: May 25 2010, 11:48 AM
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