We spend a lot of time talking about real estate. For one, it’s big business: Residential real estate alone will dominate the US real estate industry in 2025, with an estimated $110.83 trillion in market value. Undoubtedly, it’s also part of our culture. We go on Zillow searching for our dream homes, checking the value of the one we live in, or looking for an apartment in our preferred neighborhood. There are a seemingly endless number of home renovation shows that are intended to inspire (or sell to) us. And, of course, owning a home is the symbol for the American dream and a sought-after vehicle for savings.
I’m always curious about what’s behind our fixation on real estate, particularly renting versus buying. When working with clients, I try to remember that while housing can be a big financial decision, it’s so much more than numbers. We’re not just asking ourselves if we want to rent or buy or renovate; we’re asking a deeper, more emotionally charged question: “Where do I live?”
The question isn’t just philosophical. It has a real impact on our lives and shows up in moments that test our values and resilience. I’ll give you a personal example. During our home renovation, our contractor went bankrupt and said they weren’t going to pay the construction crew any longer. The house was mostly finished but still had projects that needed to be completed. I had a very strong reaction to this because the contractors hadn’t considered how their decision would disrupt my family. I thought, “But this is my home!” It became dramatic in a way but was still very real. We had decided to buy this home because it aligned with our values. And in that moment, it was clear just how much our sense of home was tied not only to the physical space but also to the life we were trying to build in it.
In this post, we’ll dive deeper into the question of “Where do I live?” and discuss the emotional and qualitative factors behind renting versus buying to consider how they can shape your financial decisions.
What does "where do I live?" mean to us
There are many meanings behind the question “Where do I live?,” but I think at the core, people are asking, “Am I going to be okay making this change or spending this money?” People often assume that whatever decision they’re making will be permanent, which isn’t really true, but that belief makes the decision feel heavier. The decision also brings up questions such as “Am I doing this right?,” “Am I risking my financial health by doing this?,” and, ultimately, “Am I making the right decision?” All these questions can evoke strong emotions because we’re so attached to the idea of home and what it promises us: safety and security. As a financial advisor, I can tell you if your decision is a good or poor financial move – but only you know what feels good for your life.
What does 'rent versus buy' really mean to us?
When we talk about renting versus buying, the most common refrain is that by renting, you’re “throwing your money away.” Obviously, we’re not literally dumping our paychecks into trash cans, but the sense is that we’re wasting something we worked hard to earn. We stigmatize renting in a way that could prevent us from making the best choice for our financial situation. For example, when you rent, you don’t have money tied up in an asset that probably won’t appreciate as much as other investments would. When you own a house, it becomes a forced savings vehicle, which is good discipline for saving but may not be for everyone.
Renting also means that you probably have more flexibility in your life and less risk. We seem to forget that owning a home means you have to maintain it (for example, spending $20,000 on a new roof every 15 years). You also risk having all your money tied up in your home. For some reason, we block out these factors when thinking about renting versus buying. The idea of owning a home has a strong emotional pull. It gives us a feeling of psychological safety because we have control over our housing and believe it can’t be taken away – even though you could still lose your housing, no matter if you’re renting or buying.
Going deeper than rent versus buy
Making the decision to rent or buy can be difficult due to the stigma of renting and the pressure to own a home. So what do you do? I find it helpful to reframe this issue for my clients. When you consider where you’re going to live, ask yourself, “Can I still live the life I want after I make this decision?”
To answer this question, we need to look at your values (for example, being close to family or having flexibility to travel), the nonnegotiables (for instance, that there must be public transit), and if the housing is geographically close enough to where you want to be. If the housing checks most of those boxes and the numbers line up, then you can feel confident moving forward. But if you start making compromises on the things you really want, you’ll be stuck with your decision. For example, let’s say you love your quality of life where you live, but the cost of living is higher. You’re thinking of buying a house in a town that you really don’t want to be in, but living there is going to save you a thousand dollars a month. Is it worth the compromise? What exactly are you saving for? I’m not advocating for making reckless decisions, but I find that people regret the decisions when they make them based on the idea of accumulating wealth instead of how they want to live their life.
At the heart of it, these decisions come down to values – what really matters to you. It’s easy to focus on things such as taxes or square footage, but often, the more meaningful questions are about quality of life.
The question “Where do I live?” isn’t just about numbers – it’s about how you want to live your life. You need to make the choice in a way that honors your values, even if it comes with trade-offs such as higher costs. It’s not about getting it “perfect” but about choosing what matters most to you. And if you can thrive where you live, it’ll be worth the compromise.
Jim is a financial advisor and owner of Thinking Big Financial, Inc. Thinking Big Financial is a fee-only registered investment advisor offering financial planning and investment management services. Specializing in working with the LGBTQ Community.
Please read my legal disclaimer here.