The Scenario

A move-up buyer is selling their current home and rolling the proceeds into a new purchase. Like many move-up buyers, the client's instinct is to put a large amount down — in this case, 50% — because it keeps the monthly liability low.

That instinct makes sense from a cash flow standpoint. But it overlooks something most Americans' balance sheets already reflect: the majority of their wealth is concentrated in real estate, with little regard for diversification, safety, or liquidity.

The Numbers: 50% Down

• Loan amount: $400,000
• Interest rate: 6.875%
• Monthly payment: $3,547.72
• Cash to close: $421,429.47

The Alternative: 20% Down

Putting 20% down instead of 50% raises the rate slightly (about an eighth of a point higher) and increases the monthly payment by roughly $1,600. But it also frees up approximately $242,000 in cash that would otherwise be locked into the home.

What Happens If That $242K Gets Invested

If that difference is invested rather than put toward the down payment, it compounds to $2.65 million over 30 years — money the client would have missed entirely by defaulting to the larger down payment.

A Middle Path: Subsidizing the Payment

Some clients are hesitant to take on a higher monthly payment, even for the sake of long-term growth. There's a third option: set up an automatic withdrawal of $1,625.92/month from the invested funds to subsidize the mortgage payment.

Even after covering that monthly subsidy, the invested $242,000 still grows by an additional $230,000 over 30 years compared to the 50%-down scenario — meaning the client keeps more money working for them while maintaining a comparable monthly payment.

Why This Matters

This is the liability side of the balance sheet doing real work. By modeling all three paths side-by-side, the client's advisor gains visibility into investable assets that would otherwise stay locked in home equity — and the client gets to see the tradeoff instead of just hearing about it.

[Watch the full case study here]

Have a move-up buyer weighing how much to put down? Send us the scenario, and we'll build a side-by-side comparison — including a reinvestment path — that you can walk through with them before they decide.