"Financially, the American dream should not be homeownership, but should be financial independence, Robert Johnson, CEO of Economic Index Associates and a professor at Creighton University, said in the report. People fall prey to the stories of individuals realizing substantial gains by buying a home and selling it at a much higher price years down the road. He noted that nearly 29% of household wealth was tied to home equity in 2021, according to U.S. Census Bureau data."
"Experts cited in the report said pulling money from retirement accounts during prime compounding years can be especially damaging. Simply put, this is an absolutely terrible idea. People need to save more for retirement, not less, Johnson said. Only about 40% of Americans are on track to meet their retirement spending needs, and the average saver faces a $5,000 annual shortfall in retirement, according to a December 2025 Vanguard report."
Financial independence should be prioritized over homeownership because housing wealth is illiquid and often inaccessible for medical bills or long-term care. Nearly 29% of household wealth was tied to home equity in 2021, per U.S. Census Bureau data. Withdrawing retirement savings during prime compounding years can be especially damaging; only about 40% of Americans are on track to meet retirement spending needs, and the average saver faces a $5,000 annual shortfall. A 35-year-old withdrawing $100,000 could receive roughly $66,000 after taxes and penalties while missing about $474,000 in potential growth over 30 years at a 6% annual return. Historically, home prices rise around 3–5% annually while the S&P 500 has averaged nearly 7% inflation-adjusted returns.
Read at www.housingwire.com
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