Buy, Borrow, Die and Refinancing Calculator: a practical guide
Could asset-backed refinancing fund my lifestyle without eroding real net wealth?
Explore the borrowing side of Buy, Borrow, Die: keep an asset, borrow for spending, reserve interest and test future refinancing. The U.S. inheritance-basis idea is explained separately; tax savings and an age of death are not calculated.
By VolatileShares · Example version 1 · Updated . Hypothetical inputs, not financial recommendations or live company data.
A worked example, in plain English
The idea in 10 seconds: Borrowing is an advance, not a paycheck. The next loan must repay the old one before you can spend.
A larger asset does not make all of the next loan spendable.
$250.00/month: spending stops in month 57. After subtracting debt, your wealth first falls below its starting buying power in month 1.
Growing asset value is not cash income. Interest, debt and forced-sale risk remain; future refinancing is not guaranteed.
- Verified model monthly lifestyle ceiling
- $37.60
- Chosen total refinancing share
- 20%
- First cycle total new loan
- $20,000.00
Walk me through the full calculation
With $100,000.00 of asset value, 20% of eligible value creates a total $20,000.00 loan. $0.00 repays old principal, $5,000.00 is reserved for 5 years' interest at the current rate, and $15,000.00 remains for lifestyle cash. That is $250.00 per month before inflation, not a permanent income.
Every 5 years, the new loan must first repay the old loan. The verified steady spending ceiling over this horizon is $37.60 per month in today's dollars, not the first cycle's monthly amount. Asset growth of 5% is an assumption, not cash interest earned. A genuine loan can provide cash without selling the asset and realizing a capital gain, but interest and repayment still cost money. The inheritance-basis part of Buy, Borrow, Die depends on qualifying assets and applicable U.S. law; it is not calculated here. No percentage is universally safest, no tax-free status is inferred, and retained assets are not the same as debt-free wealth.
The requested lifestyle stops in month 57: Spending cash cannot fund the planned lifestyle. Real net wealth first falls below its starting floor in month 1. No spending ceiling was verified in the entered stress, even with zero lifestyle spending. No sampled borrowing share within the entered opening limit meets this budget and the monthly wealth-preservation constraints.
Inputs used for this example
These are the calculator's example defaults, not suggested amounts or rates. Market calculators initially display USD. Change currency in the toolbar without creating a personal profile. Under optional Location & display settings, choose an example country for its currency and available historical CPI. Review any example household size and rent assumption before explicitly applying local assumptions: matching unedited budget/inflation fields change, while edited or restored inputs are kept. Lifestyle budgets are fictional examples, not measured national averages. Local tax, pension and borrowing links are guidance, not personal calculations. Switching currency alone does not change percentages, ages or share counts.
- How do you want to use borrowing?
- Refinancing cycles
- Asset value today (USD)
- 100,000
- Extra cash already available (USD)
- 0
- Debt already owed against the asset (USD)
- 0
- Monthly lifestyle to test in today's USD
- 250
- Age at the start of this plan
- 50
- Age to plan through
- 70
- Years between refinancing
- 5
- Yearly asset value growth to try (%)
- 5
- Total loan at each refinance (% of eligible value)
- 20
- Yearly loan interest (%)
- 5
- Other monthly income after tax (USD)
- 0
- Yearly asset or investment fee (%)
- 0
- Yearly spending and income rise (%)
- 2.5
- Asset value eligible as collateral (%)
- 100
- Opening/refinancing limit (% of eligible value)
- 30
- Lender maintenance limit (% of eligible collateral)
- 50
- Month for the separate stress shock
- 24
- Extra portfolio fall in the stress shock (%)
- 30
- Loan-rate increase after stress (percentage points)
- 2
Work backwards from your goal
What asset value could fund my monthly lifestyle?
Want $2,000 a month? Choose goal mode and enter 2000 to find a verified asset example.
Choose Work backwards, enter your target and the few essential inputs, then choose Calculate my goal. The answer is checked with the same forward calculation and applied in one step. Example assumptions are disclosed under More options. Expand Calculation details & tools only if you want more detail. Impossible or out-of-range goals show an error instead of invented numbers. Long numbers display commas while editing; calculations and saved snapshots keep the original precision.
Future refinancing is not guaranteed. This finds a verified example, not a globally smallest asset value or a safe borrowing amount.
Return to the interactive calculator above →How the calculation works
At a cycle start: new loan = eligible asset value x chosen borrowing share. First repay old principal from the new loan. Interest reserve = new loan x current annual loan rate x cycle years (final partial cycles use actual months). Available spending cash = existing cash + remaining old reserve + new loan - old principal - new interest reserve. Each month: asset growth/fee, optional shock, interest paid from reserve then spendable cash, net income and expenses, debt boundaries and inflation-adjusted net wealth. Monthly-funding mode instead compares selling, hybrid and both interest treatments.
What this cannot tell you
Deterministic generic asset-value/debt illustration, not a stock, mortgage or HELOC lending product, safe lifetime borrowing, tax-free spending, a death forecast or loan approval. Future refinancing and collateral eligibility are assumed, never guaranteed. House-backed lending can put the home at risk; appraisals, loan schedules, fees, taxes and product-specific lender terms are not modeled. New refinancing repays the old lender but leaves new debt outstanding. No asset sale is modeled in refinancing mode; this does not establish tax exemption for income, capital gains or an estate. Interest reserve uses the current rate and can be insufficient after a rate rise. Price-only returns avoid double-counting income. Cash earns no interest. Monthly funding uses configurable positive-gain sale tax, not jurisdiction-specific tax rules. No real-world success probability is inferred.
Changing an assumption changes the example, not the future. Verify source dates and actual product, tax and lending terms before relying on any result. These tools do not replace appropriately qualified advice.
A basis change is not extra cash or a forgiven loan
An asset bought for $50,000 and inherited at $100,000 may have a new $100,000 tax basis under qualifying U.S. rules. That can change the taxable gain on a later sale. It does not create $50,000 of cash or cancel a loan. An inherited value below the original basis can reset the basis down instead.
Illustrative arithmetic, not market evidence or a promise of returns.
Keep a useful starting point
In the interactive calculator, compare different assumptions or explicitly save a named snapshot to My browser notebook. Saving is optional and browser-only, not an account or cloud backup. Revisit it on the same browser profile; restoring never refreshes prices or assumptions.