Owning a house is one of the best investments you can make. Your principle residence is exempt from capital gains tax. Real estate gains usually far exceed mutual funds and they are more secure than investing in stocks.

Tax Stress

I was talking with this lady and mentioned that I did taxes for people, and I was invited  over to work on her taxes. While we were at her place, she informed me that she had not done her taxes for the previous two years as well. She had various things that she did not how to deal with, so instead she just put it in boxes in her closet. Like many people I meet, they put off dealing with something, hoping that it will go away. But, the reality is that the longer you leave it, the more anxiety it causes.

Consider the following scenario: A divorced couple with a child. The father pays child support payments to the mother, and the mother pays for daycare for the child. In this scenario, the mother gets the child tax deductions, and the father gets no deductions, yet both are paying towards the raising of the child.