ONE RULE OF THUMB says that, if you’re in the workforce, you should save 10% of your pretax income every year toward retirement.
But with both future investment returns and future employment uncertain, it’s probably wiser to save 12% to 15% and to start socking away money as soon as you enter the workforce. By starting in your 20s, you will have a cushion if you later find yourself out of work, and you’ll get greater potential benefit from investment growth.

OVER THE 40 YEARS through 1998, the monthly U.S. savings rate averaged an impressive 10.2%, according to figures from the Commerce Department’s Bureau of Economic Analysis. But in the decade that followed, the savings rate collapsed, plunging to an average 4.1%.
Since then, our financial behavior has improved somewhat, with the monthly savings rate notching an average 6.6% over the past 16 calendar years. That average got a big boost from the 15.1% monthly savings rate in 2020 and the 10.9% rate in 2021,

WHEN YOU SELL YOUR primary residence, you can’t claim a tax loss if you receive less than you paid. But you can avoid capital gains taxes on $250,000 of appreciation, or $500,000 if you’re married filing jointly. To qualify for the $250,000 or $500,000 exclusion, you need to have lived in the house for at least 24 months during the prior five years.
What if your capital gain is more than these sums?

FOR MANY ORDINARY Americans, buying properties and renting them out has been a road to financial success. Typically, the strategy is to find places where the rental income can cover the mortgage payments and other ongoing costs. That way, the tenant effectively pays off your loan, plus you also benefit from any price appreciation. As you raise the rent over time, you can get to the point where you aren’t merely covering costs, but pocketing a tidy sum each month.

WHEN YOU SELL YOUR home, you might make back 50% to 70% of the money spent on recent remodeling projects. For proof, check out Remodeling magazine’s annual survey at CostvsValue.com. The survey is based on selling your home within a year of making the improvements. The longer you wait to sell, the less you are likely to recoup, because your improvements will no longer look spanking new.
In other words, as with homeownership in general,

PUNDITS OFTEN TALK about the state of the national housing market. But that’s not terribly helpful if you’re looking to buy a home. Why not? The housing market varies so much from one part of the country to another.
How can you get a handle on the local property market? Ask a local real estate agent for details on recent sales, including how long it’s taking properties to sell and how final selling prices compare to list prices.

DESPITE THE COST involved, the vast majority of homeowners continue to use a broker when they sell. Real estate commissions were once a standard 6% of the proceeds from a home’s sale. Today, 5% is increasingly common, with the commission set at perhaps 4% if the seller’s agent also manages to find the buyer, without involving another agent. But whether it is 6%, 5% or 4%, it’s a lot of money, though maybe not as lucrative to the broker as you imagine.

THE PRECISE NUMBER is a matter of some debate: Still, each year, it seems less than a tenth of homes are sold directly by owners, rather than through a real estate agent. Moreover, selling direct seems to be growing less popular.
Tempted to give it a try? Sellers can list their homes using sites such as BuyOwner.com, ByOwner.com, ForSaleByOwner.com and Zillow.com. Many of these sites charge if you want more than a basic listing.

PREPPING A HOME FOR sale can take months, so give yourself ample time. What needs to be done—and what shouldn’t you do? Here are some pointers:
Skip the remodeling. Most home improvements are money losers, so you shouldn’t undertake extensive remodeling with a view to turning a profit when you sell. On the other hand, smaller improvements—a fresh coat of paint, a tidier garden, refinishing the bathtub—could be worthwhile, because they may make your home easier to sell.

THINKING OF BUYING a home? Before you start bidding on properties, ask yourself six questions:
How long will I stay put? If you think you’ll move within five years, perhaps because of your job or because the house you can currently afford won’t really be big enough, buying may not be smart. It would likely be better to wait until you can purchase a place you’ll be happy with for the long haul.

I’VE OWNED FOUR HOMES since 1992, including my current house in Philadelphia. I bought a house in New Jersey in 1992 for $165,000 and sold it two decades later for $409,000. I next owned an apartment in Manhattan, bought in 2011 for $570,000 and sold in 2014 for $800,000. I used the proceeds to buy an apartment just north of New York City for $730,000, which I later sold for $715,000.
All this makes homeownership sound like a generally profitable endeavor—and it has been,

OKAY, REAL ESTATE price appreciation is nothing to write home about. Okay, the benefits of leverage might be offset by the cost of the mortgage. In fact, once you figure in all the expenses involved in buying, owning and selling a home, there’s a good chance you are losing money big-time. But you get to live in the place, right?
That is indeed the big payoff from homeownership. If you live in your own home,

SUPPOSE YOU BUY a $300,000 home. To avoid taking out private mortgage insurance, you make a 20% down payment, equal to $60,000. You borrow the other $240,000 using a 30-year fixed-rate mortgage with a 5% interest rate. Five years later, your home is worth $360,000, or 20% more than you paid.
Your gain, however, looks considerably larger. Your home equity, which was initially $60,000 thanks to your down payment, has grown to $120,000. That’s the wonder of leverage: A 20% rise in your home’s value translated into a 100% increase in your home equity.

WANT TO CHECK ON current stock and bond market valuations? Here’s where you can get the latest on some key market yardsticks:

Find out the S&P 500’s price-earnings ratio based on trailing 12-month reported earnings.
Look up the S&P 500’s cyclically adjusted price-earnings (CAPE) ratio. CAPE compares current share prices to average inflation-adjusted earnings for the past 10 years.
See where U.S. stocks are trading relative to the value of corporate assets. This measure of stock market value is known as Tobin’s Q.

FOLKS ARE FASCINATED by what their homes are worth. Along the way, they make all kinds of dubious claims about how much they’ve made—and they miss the big story. Want to get a better grip on your home as an investment? For the moment, forget about your mortgage and focus just on home price appreciation.
Historically, homes have not been a great source of price appreciation, climbing a little more than one percentage point a year faster than inflation over the long haul.