Pre tax vs after tax dollars
“Employees make the best dates. You don’t have to pick them up and they’re always tax-deductible.” – Andy Warhol
I always prefer to spend pre-tax dollars because they are half the price of after tax dollars. This is why I’d much rather pay the rates on my investment property than on my own home. As the former is tax deductible, they are made with pre-tax dollars and as the latter are non-deductible, they come from after tax dollars. It is also why I urge investors to keep their investment loans on an interest only basis until their non-deductible loans are paid off.