My first post in forums! I've found that many of you consistently buy rental properties with mortgages. I've searched here quite a bit on this topic, but wasn't able to find a definitive breakdown of how buying a rental property with a mortgage can turn better profits than with cash. Here's how I've approached it, assuming I have 80K in cash on hand:

Option 1

Mortgage: $80,000

Rent (1% rule): $800

Mortgage (4%) payment: $380 (with taxes and insurance): $580

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Put $80K in cash into VTSAX at 7%.

Contribute $220 monthly (Rent-mortgage payment = $220)

**Net worth at 5 years: ($128,448 + $7,800) - $15,500 | (VTSAX + Equity in property) - Total Interest Paid thus far = $120,748**

Net worth at 30 years: ($875,813 + $80,000) - $57,500 = $898,313

Option 2

Paid with cash: $80,000

Rent: $800

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Put $800 into VTSAX every month (beginning balance $0)

**Net worth at 5 years: $60,193 + $80,000 (VTSAX + Property) = $140,193**

Net worth at 30 years: $976,390 + $80,000 = $1,056,390

I know it'll take a couple reads to understand what I've written, but any help is appreciated. Am I missing something here?