re: Percentage of net worth "invested" as equity in your primary residence?

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I'm not trying to jump on you here but your mindset is very financially immature.

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ILB, let's not do the typical money board thing. He's not talking about buying depreciating assets or whatever.

I led with the "invest" - delayed instant gratification - however, if you're going to overspend on anything, it should be the home - that part I do agree with, although the amount of overspending should be slight.

Going with 15-year mortgages builds in a conservative bias against overspending - which is why I recommend those for most people. It is a built-in conservative bias, with built-in discipline. In an extreme bind, one can always take equity out, and extend the loan terms - from a 15 - in a 30, there will be little equity (beyond the downpayment) for years and years, and if you cannot afford the 30-year note - you cannot afford the house - so you're selling at a loss (which you can't afford) or in foreclosure (which is worse).

However, he seems to be fairly financially stable - I would still invest it and increase his income - permanently - as you would - but we should also answer his underlying question.

I don't see a cap as to how much liquidity you should give up in equity in your home - with HELOC and other vehicles, I feel this is a false distinction. If you own the house outright, you can be investing your house note every month, DCA. A person who does that is wealthy, regardless of what the min/maxers tell me about free money.