Notices by Adam Lett (adamlett@mastodon.xyz)

@danluu Does this calculation account for the fact that besides appreciating in value, a house also provides you a place to live? After all, you can’t invest the money you spend on rent (or – in fairness – interest on a mortgage).

One other thing besides owning vs renting, jumps to my mind: Insurance. I would imagine that poor people forego insurance on things like cars and healthcare, with catastrophic economic consequences for some.

@danluu Is the $1k you are saving the amount that the insurance is overpriced with respect to it’s expected value? If so, how do you know that?

@danluu You are in effect self insuring, which may or may not be cheaper than the alternative, depending on a lot of factors.

But I still think my point stands, which is that if you cannot absorb the variance, self insurance (ie. no insurance) has the potential to wipe you out.