The most expensive part of a vacation home isn't the house.

"Can we afford the lake house?"The wrong question. The real one is where the money comes from.

A family finds the lake house. They need $900,000, and the simplest path is to sell some stock. But the simplest path is rarely the cheapest. The question isn't whether they can afford it. It's where the money should come from.

The ripple

A purchase is one decision. How it's funded touches taxes, the portfolio, the reserve, and the estate, all at once.

The family needs $900,000 for a second home

Sell appreciated stock, and realize a capital gain, plus the 3.8% surtax?

Or borrow against the portfolio with a securities-backed line, and stay invested?

Or a mortgage, weighed against the portfolio's expected return and today's rates?

Whatever is sold has to keep the emergency reserve intact

And keep asset location and the target allocation from drifting

The new property changes titling, the estate, and future RMD math

What you keep

One purchase. A half-dozen funding paths, each with a different after-tax cost.

Same house, two outcomes

Uncoordinated

The advisor sells the most appreciated stock; the gain surprises the CPA months later.
Cash vs. mortgage was never modeled against the portfolio's expected return.
The emergency reserve is quietly drained to round out the purchase.
Concentration and asset location drift; the estate and titling are never revisited.

Coordinated

Funding compared across cash, a securities-backed line, and a mortgage before an offer.
Losses harvested to offset any stock that must be sold.
The reserve is protected; asset location and future RMDs modeled so later years aren't distorted.
Titling and estate implications of the new property settled up front.

Same house. A different cost of owning it.

In the room, modeled together before the offer: investment plan, CPA, lender, and the estate plan.

Financial decisions should not surprise one another.

More from the library: Selling a business · Inheriting $3 million · The $600,000 conversation

See the ripple on your own numbers.

The Tax Diagnostic starts with your state and bracket and shows what a coordinated approach could be worth for you, in about two minutes.

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Illustrative and educational — not investment, tax, or legal advice. This is a hypothetical scenario. Outcomes depend on your own facts and on current law; borrowing against a portfolio (a securities-backed line) carries margin-call and market risk, and mortgage, tax-loss-harvesting, and estate decisions require individualized advice. Driftwood coordinates with your CPA and attorney; it does not provide tax or legal advice. Driftwood Wealth is a registered investment adviser; Form ADV Part 2A and Form CRS are available directly; the firm’s public record is at adviserinfo.sec.gov. Privacy Policy · Terms of Use.