SBLOC to double dip invest and “Buy Borrow Die”

Helocs and margins accounts should be a core part of FIRE strategies. It would prevent spending investments during down markets.

It would make ACA credits dialed in. It would allow Roth conversions t be easy.

It’s crazy there’s not any discussions on the choose fi podcast

It is an interesting idea. Sounds more complex and would require a relatively large taxable brokerage account, which is generally frowned upon in the FI/RE community. Perhaps it's more common in the chubby or fat FI/RE space.

Check out mile high FI podcast episodes with guest Rusty. Really clear-headed explanations of the strategy

My sense of why it isn’t talked about more often is that leaving more to kids/charity is a nice to have rather than an imperative

To answer your question about why this isn't discussed more; I think it's because borrowing runs against a core FIRE instinct to reduce debt. I also think many of us are focused on reducing sequence of returns risk, and a SBLOC can increase risk there.

There's also a mismatch with how many of us are planning our withdrawal order of operations. The standard sequence draws taxable brokerage down early, partly to fund living expenses, but also to take advantage of low (i.e. 0%) tax brackets, and funding Roth conversions. That means the taxable balance you'd need as SBLOC collateral might be flat or even shrinking when you'd need to increase borrowing against it.

Where I think this could fit more broadly is end of life care, assuming you've still got a large taxable balance. At that point you're less exposed to SORR, since there's less time horizon left for a bad sequence to do damage, and your heirs are much closer to that step-up basis. It also means you're not forced to sell into a down market to cover a big unplanned expense. Plus, you can potentially avoid large tax hits from having to sell assets to pay Uncle Sam (and the nursing home).

It is talked about, but not a whole lot. It doesn't work for everyone, as the securities backing the LOC generally cannot be in retirement accounts or other tax-advantaged accounts. The reason is that the lender will normally include a provision that allows them to unilaterally liquidate your securities to keep the loan-to-value ratio within a given range. And that's not something they can do with securities held in a retirement or other tax-advantaged account.

And, of course, there is the very real danger that comes with leverage. If you are leveraged 50%, then a 50% drop in the market means you lose 100%. Plus there is interest rate risk as well.

The best strategy that I've heard discussed about this was on a ChooseFI episode in 2025 (I think) which basically went like this:

• build up assets in your taxable brokerage account (it doesn't have to be all the way up to your FI number, but it can be something like 50% of your FI number)
• when you are ready to start, take out a SBLOC for your year's living expenses (which should be a fairly low percentage of your available assets, like <20%)
• the next year, you let the LOC balance increases by the interest owed (since in most years market growth will be substantially higher) and you add to the LOC by taking the next year's amount
• this has the normal sequence of returns risk, because years of bad returns up front have the potential to substantially increase how leveraged you are (hence the conservative starting point of a very small amount of leverage compared to the total size of the asset base)
• if returns aren't bad, then over time you continue borrowing, but the assets grow faster than the interest on the LOC the amount of leverage actually decreases over time

As you observed, it is a bit more complicated than the simple path. Some people just don't want all that complexity. And if you've already gone part way down the path by optimizing for tax efficiency using tax-advantaged retirement accounts, the only way to liberate the assets from those accounts to be able to do the SBLOC thing usually involves substantial taxes and penalties.

It's the sort of thing is only really viable when you intentionally or unintentionally end up with a very large asset base in a taxable brokerage account, which isn't super common in the FI community.