[LWJ]

I stopped reading early on here. I am a contrarian. It has served me well. I use my home, and my rental properties like an ATM. I have debt on both the forementioned items. I pay 2.375 on my home and have used some of that cash to earn 10-20+++% returns over the recent years. I am about to buy a vacation home in October in Italy. I am going to try like heck to get a mortgage on it. One of the driving factors is that I would pay 2-4%. Wow. If I just average the S&P500? I would make a killing on the delta.

With all that aside, you (and I) ABSOLUTELY need to manage for downside risk. Can you take a market hit? If not, don't do it. Don't gamble what you can't afford to lose.

I will leave you with the wisdom of my absolutely brilliant Grandfather, who founded a ludicrously successful bank. "If you can borrow money at X, and earn X+1 or more, do it all day long." That does however mean you need to allow for risk.

Good luck. Ultimately, do what you are comfortable with. Either way is a win.