Therefore, their choices are to sacrifice a bit now so that in 30 years they have a home paid for and $204,958.63 in the bank, or a slightly smaller house payment and a home paid for without a good start on their nest egg. Many of the choices you make 10-20 years ahead of retirement can pay off very well when you want to retire.
I’m a firm believer in paying for your home as soon as possible. Unfortunately, beginning with a starter home and moving up to McMansion after McMansion has become commonplace; this habit can make it practically impossible to pay off your home in a timely fashion.
The general advice sounds good: beware of long mortgages for houses you don’t need. Instead, take the money you could save with a smaller mortgage over a shorter period of time and invest it.
However, the idea of people buying McMansion after McMansion after having a starter home sounds exaggerated to me. Perhaps I might be wrong: do McMansion owners tend to live in multiple such homes over their lifetime? Are they more or less likely to move than others? The illustration makes sense – don’t keep purchasing home after home that you can’t afford – and fits the idea that Americans overconsumed in the late 1990s and early 2000s. But, I would be interested in knowing more about serial McMansion purchases…