Jimmy and Rosalynn Carder are both 50, live in Planes, Georgia, and earn a combined $75,000. Thanks to the untimely death of Jimmy’s rich brother, Bilous, they also have $500,000 in financial assets. Jimmy and Rosalynn want to buy their dream house. It’s on the market for $437,500. But they don’t know whether to use their inheritance to buy it outright or use just 20 percent of their inheritance as a downpayment for a mortgage and save the rest. At the prevailing 7 percent rate for a fixed-rate, 30-year mortgage, they’ll pay $2,329 per month if they take out a mortgage.

One way to raise your living standard is to sell extra homes, assuming you are rich enough to own more than one home. Take Earnest Hammokway and his wife, Ilsa. Both are currently age 60 and make $100K each. Collectively, they have $150k in regular assets and $800K in retirement accounts. Their primary home is valued at 750K and their vacation home on the Two Hearted River in Newberry, Michigan is valued at 300K. They have 10 years left on the primary home’s mortgage and 15 years left on the vacation home’s.