26-year-old debt free millennial: “I agree with David Bach that buying a home is an escalator to wealth…”

Millennials Dave Bach

Recently, real estate resource, Keeping Current Matters, shared statements from the self-made millionaire, David Bach, on the value of millennials owning real estate.  Bach’s statements were originally mentioned in an earlier CNBC piece.  In the CNBC piece,  Bach was quoted as saying,

“If millennials don’t buy a home, their chances of actually having any wealth in this country are little to none. The average homeowner to this day is 38 times wealthier than a renter.”  According to Bach, “the single biggest mistake millennials are making” is not buying a home. And, owning a home, according to Bach, is an “escalater to wealth.”

Millennials David Bach

26-year-old millennial, Phil Risher, enthusiastically agrees.  Phil is the founder and editor-in-chief of the Young Adult Survival Guide. 12 months after college,  Phil paid off  $30K in student loan debt on a salary of $48K per year.  Two years after that, at age 25, Phil saved $60K and he bought his first condo.  He bought it at a deep discount with cold hard cash.

Neuse Realty had an opportunity to ask Phil a few questions and his thoughts on David Bach’s advice to millennials.

Q:  Do you agree with David Bach’s statements?  Why or why not?

A:  I agree with David Bach that buying a home is an escalator to wealth because you are building equity.  I don’t believe renting is bad if you have a plan to move on to home ownership. I have a lot of friends who rent with roommates and are saving money for a down payment on a place of their own.
Q:  Do you currently own your own home?
Yes, I own my home. I saved up to buy it without a mortgage. I did this by “renting” from my parents and living in their basement.
Q:  Tell us how you were able to buy your own home.  What was that process like for you?
I lived in my parent’s basement for two years paying them $200 per month in rent. I, acutally, read David Bach’s book, Automatic Millionaire.   I highly recommend it.  The book helped me understand the concept of net worth and how adding real estate accelerates your wealth exponentially.
 Q:   Did you use a real estate agent?  
Yes, I did use a real estate agent.
 Q:  What is your advice to young millennials about home ownership and other wealth-building strategies?
A:  If you want to be wealthy, read and learn from people who are wealthy–from those who are doing it or have have done it.  Also, make sacrifices, now, to set yourself up for future success. It wasn’t very glamorous, sexy, or independent to live at home.  However, a small sacrifice, then, has catapulted me on my way to wealth.
 Q:  What action steps can young people take to position themselves toward homeownership if they are, currently, in a financial crisis? 
A:  I strongly believe budgeting and practicing discipline in how you manage your money is the answer.  If  you happen to be in a financial crisis, I would not recommend trying to buy a house just because you think it will make you wealthy–especially if you have poor money habits.   For, attempting to buy a home or living above your means, as a renter, creates financial crisis.  Such can become a recipe for financial disaster.  I recommend getting any financial crisis under control, first.  Then, rent  (below your means) until you get your crisis under control.  However, keep your goal in mind.  Set a plan in place (even in crisis) to exit your crisis and eventually own your place.  You should aim for one small win at a time.

These are the five steps Phil says he followed to the financial freedom he is currently experiencing–well before his 30s.  He has expressed that his mission is to do all he can (sharing his story) to ensure his millennial peers don’t become one of the above statistics.  Phil will be speaking at universities around the country sharing his story, these steps, and his budgeting strategies starting this spring.

What about you?  Are you satisfied with your financial habits?  If not, what steps will you take in 2017 to begin to change your financial future?   Tell us in the comments below and please SHARE this post with your social network or with anyone you believe it would inspire to take action to change their financial future.

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David Bach wrote a book called, The Automatic Millionaire. It is available on and offline.

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