Listen Money Matters - Free Your Inner Financial Badass. All The Stuff You Should Know About Personal Finance.

We mentioned margin and a previous episode and only touched on it.  A lot of you wrote in with questions so we’re doing a whole show to explain what it is.  Simply put, margin is borrowing against your investments without selling your investments.  You can pull money out of your brokerage account on margin by setting a toggle on the account.  You’ll pay interest and if you don’t pay back the loan, the brokerage firm takes your investment.  It’s like borrowing money against your house.  If you don’t repay it, the bank takes the house.  There isn’t a monthly payment, the interest gets added to the total margin you have out. The trick is to grow your investments faster than the rate of the interest.  Playing with margin can be really good or really bad.  Margin is the reason people like Warren Buffett gets huge returns and the rest of us don’t.  You can use margin to do whatever you want, go to Vegas, buy a house, or invest in more stocks. We are doing this episode for informational purposes.  Margin is a risky