Buy more rentals or new primary home first?

Question

My new wife and I live on one side of a duplex where we rent out the other side. Pretty good economics on Deal One as the payment is fully covered by the rent, allowing us to build our nest egg. Downside is, she doesn't like living here, and I agree, it's not an ideal layout for future little ones. But Rich Dad is telling me definitely don't buy Bigger House until you have Bigger Pockets (see what I did there?), and I can see why - saving for that next investment will be a lot slower if we take on a higher mortgage payment (especially when accompanied by kids, loss of her income, etc.).

In short, I want to do more investing for our family, but the road ahead looks more and more difficult since I didn't start this endeavor until late. Advice?

Josh Mitchell · Answer

@Kurt Dieringer it would be up to you, but obviously as you mentioned it will slow things down with another mortgage. However, you would be getting the rent from the unit that you guys currently live in that would offset a majority of the new mortgage payment right? This could still allow you to live comfortably and continue to build the "nest egg" you mentioned, albeit slower than before. One thing you could do is to give yourself a time frame (say a year) and pay down the duplex as much as possible then refinance this to either a) lower the monthly payment or b) cash-out refinance to purchase the next property in cash? Just something to think about..... Good luck!