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Wealth Trajectory

Where will your net worth be in 20 years?

The house
$
$
%
Investments & growth assumptions
$
$
%
%
yr
Compare against

Net wealth at year 20

$2,478,807keeping the house

Combines home equity (after appreciation and mortgage paydown) and investment portfolio (with monthly contributions and market growth).

Net wealth (year 20) — Keep house

$2,478,807

home equity + investments

Net wealth — Sell & rent

$109,911

$-2,368,896 vs keep

Net wealth — Move up

$1,729,809

$-748,998 vs keep

Home equity (20yr)

$1,314,674

appreciation @ 4%/yr

Trajectory over time
Keep house
$0$495,761$991,523$1,487,284$1,983,045$2,478,807Yr 0Yr 4Yr 8Yr 12Yr 16Yr 20

What this models:

  • Mortgage amortization (interest + principal paydown each month)
  • Home appreciation at your stated rate
  • Investment portfolio growth + monthly contribution
  • Sale proceeds (after 7% selling costs) go to investments in sell scenarios
  • Move-up assumes proceeds become down payment on a bigger home (3% closing on new)

What this doesn’t model:

  • Capital gains tax at sale. §121 exclusion ($250k single / $500k MFJ) covers most primary-home sales, but appreciated long-held homes or move-up sales can blow past it. Use the cap-gains calc. Also: cap-gains on the investment portfolio at exit isn’t modeled.
  • Mortgage interest deduction. If you itemize, the keep / move-up scenarios get a tax benefit not credited here. Use the MID calc.
  • Property taxes & insurance. Assumed similar across scenarios. In move-up, property tax can spike on reassessment (CA Prop 13 reset, FL Save Our Homes loss, etc.) — can be a multi-thousand-dollar annual hit not reflected here.
  • Maintenance / capex on the house (typically 1-2% of value/yr) — materially understates the cost of homeownership in keep / move-up scenarios.
  • Sequence-of-returns risk on investments — the model uses smooth compounding; real markets are lumpy.
  • Rent growth assumption is 3%/yr; reality varies wildly by market and was 5-8%/yr in many metros 2021-2024.
  • Closing-cost frictions on the move-up. 3% closing on the new home is modeled, but agent commission on the sale is bundled into the 7% selling cost, not credited separately.