4 Benefits of Renting That Nurses Can Use For Building Wealth

4 Benefits of Renting That Nurses Can Use For Building Wealth

Are you interested in learning how to make your money work for you and build wealth outside of your nursing career? Lume offers easy-to-use tools and empowers nurses with the knowledge to successfully earn more. Let’s take a look at one foundational American ideal — owning a home. Although it has some advantages, certain challenges may outweigh the benefits. Instead, have you considered investing in real estate or exploring the advantages of renting?


Owning a Home

The need to spend money on housing is one major reason for buying a home. Conventional wisdom says that since you will  have to pay money for housing regardless, you might as well pay off a mortgage debt as your house appreciates. Once you pay off the mortgage, your housing costs disappear and you will  have a large asset to benefit from. However, the challenge is that your investment isn’t liquid. This means you won’t have access to the money until you sell the house or take out another loan against the property. Some additional hidden costs of being a homeowner include:


  • Down payment - Conventional mortgages require a minimum of 3% of the home value. If your down payment is less than 20%, you will be required to pay private mortgage insurance (PMI).
  • Mortgage interest - Money that is paid to your lender, in addition to your principal loan.
  • Homeowners taxes - Taxes are assessed yearly and based on the value of the home. These taxes never go away during your ownership.
  • Maintenance costs - Many houses require both big and small maintenance projects. Roofing, heating, and plumbing are among the most costly to repair. The standard advice for a homeowner is to have 1% of the home’s value available for maintenance.


It’s important for homeowners to identify all of the costs involved in owning a home. Extra money is often spent on the home, as opposed to alternative investments. Rather than considering owning a primary residence as a financial investment, homeownership might be viewed as a lifestyle choice.


Renting a Home

The opposite of owning a home is renting. This decision challenges the American ideal of homeownership. The benefits of renting a home include: 


  • No maintenance costs - When a pipe bursts or the roof leaks, you will not need to pay for damage or repairs. 
  • No down payment - You will not need to come up with 3-20% of the property value before moving in. 
  • Geographic mobility - You have the ability to relocate when and where you want. This could allow you to move to an area with a lower cost of living or take a job in a new location.
  • Needs and desires change - Your housing wants and needs of today may not be applicable in 5, 10, or 20 years. Renting offers  more flexibility for  your changing needs.


Renting should no longer be viewed as throwing away money. Investing the money saved through renting can yield higher returns than the appreciation of owning a primary residence. Therefore, you may want to consider renting as a strategic decision in your financial plan.


Types of Real Estate Investments

Real estate can be a great investment when used  intentionally for growth purposes. Investing in income-producing properties offers access to the appreciation of the real estate market, while the property produces a cash flow that pays the mortgage. Some types of real estate investments for financial growth include:


  • Rentals - Short and long-term rentals, multifamily properties.
  • Syndications - An alliance of individuals who pool their money to purchase income-producing properties, providing passive income. 
  • Real Estate Investment Trusts (REIT) - Investments in companies that own and operate commercial properties to provide passive income.


How To Get Started in Real Estate Investment

Getting started in real estate investing does require some money up front. 


  • Rental properties - Mortgage companies require at least a 20% down payment for an investment property.
  • Syndications - Investment minimums vary widely between syndications, but are often $25,000-$100,000.
  • REITs - Forbes states that when fractional shares are available, publicly-traded REITs can be purchased for as low as $5. Public non-traded REITS can have an investment minimum as low as $1,000.


Owning a home for your primary residence may be an American ideal, but it isn’t always the best choice for everyone. Building a strong financial future is also possible through renting your primary residence and investing in cash-flowing real estate.


To learn how to make wealth building easy, join the waitlist at Lume.

Sarah Villavicencio BSN, RN

Sarah Villavicencio BSN, RN is a financial enthusiast, freelance writer and owner of Sound Writing Solutions. Based in Seattle, she has over 22 years of pediatric clinical nursing experience with medically complex patients. When not at work, she enjoys family time, long walks and smelling the salty sea air.

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