Paid off house envy

[FTD]

I just got a big dose of paid-off-house envy from some comments in another thread! :D

I need a financial adviser - the kind that listen to what I am trying to do / save up for and are exposed to diverse investment beyond which mutual fund has a strong Morningstar rating.

Comments? I don't know where to start in finding this person.

[Grizzly]

Guys who have financial advisers may tell you something very different, but I would suggest learning everything you can about personal finance for yourself. There are a million books out there to help you with every facet of finance and dispel a lot of myths that may have held you (and others) back.

Strangely, the first two finance books I ever read were by a guy named Charles Givens. They were called Wealth Without Risk and Financial Self Defense. The strange part was that, years after I read his books and used them to start down my path, Mr. Givens was successfully sued by several people who claimed to have been financially harmed by his advice. Though the claims against him may all have been true, he certainly helped me. Since that time, I've probably read 100 or more personal finance titles and have developed a strategy that has allowed me to accomplish amazing things on a Government salary. Money can do some incredible stuff, if you know how it works.

If you do decide to go the financial adviser route, learn all that you can anyway. If nothing else, you'll know enough to ask the right questions.

[zackwatt]

Don't you get substantial tax breaks with a mortgage vs a paid off house?

[blue2000s]

Don't you get substantial tax breaks with a mortgage vs a paid off house?

You get deductions based on the interest you paid on the house, but for me at least, that doesn't offset the interest paid itself. For me, the tax savings are less than half of my total interest for the year.

I've heard people say you should have a mortgage for the tax deduction, but I honestly haven't seen that it's enough to justify not paying the house off in total.

Of course, if you use that money that would otherwise be tied up in the house in investments that are gaining at a greater rate than your interest payments are costing, then you are ahead of the game. But on the other side of the coin, the house itself is a great investment as in general, property rises in value.

[Brucelee]

My house has been paid off for 8 yrs. Nothing like it in the world, IMHO.

[YellowJacket]

There are two sides of this issue.

Most financial advisors will tell you that paying off a house is a poor investment. And it has nothing to do with the return on the asset itself (the house). Your return on the real estate portion of the deal is the same either way -- if my $5 house is now worth $5.50, I've made 10%, regardless of whether or not there's a mortgage. The difference in return argument applies to the mortgage vs. other investments. Basically, paying ahead on your house is equivalent to investing in a savings account with an effective interest rate equal to your mortgage. If your mortgage rate is 6%, and you would consider a 6% risk-free savings account to be a good investment, then you should pay ahead on your house. This is an easy scenario because the tax implications are the same -- both are taxed (in opposite directions) at your top tax bracket. However, if you can come close to that level of returns with low risk in the market (I say come close, because I'm assuming you hold your stocks for at least a year and pay cap gains at 15% instead of income tax), then you're better off investing in the market. Most advisors would assert (and I would agree) that you could easily make more than your mortgage rate in the market, which is why they would advise against paying off your house.

On the other hand, there is the intangible emotional factor. A lot of people just enjoy knowing that their house is theirs outright, and there is no sum of money that can replace that feeling.

Rationally, I'm firmly in the first camp, but my wife wants to quit working and become a momma in her early 30's, and we'd like to be "set" by then, so we're paying ~2X our payment right now. We're on schedule to be paid off by the time I'm 34 and she's 33 (8.5 years from now). Although I would not even consider paying a penny early on my house unless we were both already maxing out our 401(k)s and IRAs, something else to keep in mind.

What is the moral of this rant? Well, in my case its that marital bliss trumps financial optimization. :)

By the way, if you do go the advisor route, start out with a fee-only advisor until you really know the ropes. Too many people out there trying to put you in the investments that optimize their commissions, rather than those that optimize your returns.

[Perfectlap]

Pay yourself first. That means as soon as money comes in stash 10-15% away before you pay a single bill. If you can't do that you are living beyond your means.
Any FA who tells you not to do this is out to lunch.

Also, I'm constantly amazed by the number of 30+ year olds who haven't the slightest concept of the stock market, mutual funds, fixed income. etc.
Don't make a decision in FA or broker's office without first reading up on these topics. INvesting for dummies is a good place to start. Suze Orman is also pretty clever.

[Brucelee]

You can run numbers and make either scenario look good. Many FA are only paid if they sell investment products, so few will tell you to pay off your mortgage instead of invest the cash.

That said, I love the 100% certainty of having paid all the interest to the POSSIBILITY that I could have invested the money for a greater return.

That's just me.

[Brucelee]

Oh, yeah. How did I do it?

I made a lot of money for a good amount of years and didn't spend it on things I didn't need (except Porsches of course). :D


Even managed to put the kid through graduate school.

I am a lucky, lucky man and thank the Good Lord for that often! :)

[Topless]

Oh, yeah. How did I do it?

I made a lot of money for a good amount of years and didn't spend it on things I didn't need (except Porsches of course). :D


Even managed to put the kid through graduate school.

I am a lucky, lucky man and thank the Good Lord for that often! :)

Congratulations! There is surely a great sense of freedom with zero mortgage payments.

I am not there yet but closing fast. I had to get two kids through UCSD first. This is partly why I drive a 9yr old Porsche with 17" . :) I am looking forward to that last house payment.

[bmussatti]

Not to over simplify, but paying off the house early was very-very easy to do.

Why do I say this? Because we have never ever spent more money than we ever made & brought home! Not even close. We did this through 5 years of dating and 15 years of marriage.

Here are some side notes important too. I did not go to college after high school. Why? I was poor, and my parents did not have the money either. Long story short, took a year off before starting college to work and save, I put myself through college, and went to work.

From day one, we always put $200 dollars extra towards the mortgage. And when the stock market was rocky, I paid down the mortgage with a part of a year-end bonus. You'd be amazed how many years get chopped off with a $10K lump sum payment, for example.

In February of this year we had about 3 years left, and just decided to be done with it, and made the fianl payment on a 7% fixed mortgage. We still make the exact same payments into a seperate investment account for a future home purchase or an addition.

Also during this time we "gifted" funds to our new-born children, for thier college funds. We did lump-sum ammounts and consider their 4-year in state educations fully covered even before they were 1 month old. 401K's and IRA's are max'ed out too.

Like smoking, drinking, gambling, buying Porsche stuff; saving money is very habitual. Once you start, stopping becomes most difficult to do! :)

PS- I don't smoke or gamble.

[Brucelee]

Congratulations! There is surely a great sense of freedom with zero mortgage payments.

I am not there yet but closing fast. I had to get two kids through UCSD first. This is partly why I drive a 9yr old Porsche with 17" . :) I am looking forward to that last house payment.


Thanks.

Keep truckin'; its worth it. Putting two kids through college is an achievment, no doubt!

:)

[Brucelee]

Not to over simplify, but paying off the house early was very-very easy to do.

Why do I say this? Because we have never ever spent more money than we ever made & brought home! Not even close. We did this through 5 years of dating and 15 years of marriage.

Here are some side notes important too. I did not go to college after high school. Why? I was poor, and my parents did not have the money either. Long story short, took a year off before starting college to work and save, I put myself through college, and went to work.

From day one, we always put $200 dollars extra towards the mortgage. And when the stock market was rocky, I paid down the mortgage with a part of a year-end bonus. You'd be amazed how many years get chopped off with a $10K lump sum payment, for example.

In February of this year we had about 3 years left, and just decided to be done with it, and made the fianl payment on a 7% fixed mortgage. We still make the exact same payments into a seperate investment account for a future home purchase or an addition.

Also during this time we "gifted" funds to our new-born children, for thier college funds. We did lump-sum ammounts and consider their 4-year in state educations fully covered even before they were 1 month old. 401K's and IRA's are max'ed out too.

Like smoking, drinking, gambling, buying Porsche stuff; saving money is very habitual. Once you start, stopping becomes most difficult to do! :)

PS- I don't smoke or gamble.

The extra payment method really really works. I ued to throw as much extra money at the mortgage as I thought I could afford. Over 10 yrs or so, it really saves a ton on interest.

Congrats on a job well done.

:)

[RandallNeighbour]

FTD, to answer your original question...

Financial Advisors will not do anything more than get you into mutual funds with good morningstar ratings.

Helping you make double or triple the amount of a mutual fund takes a heck of a lot of work... and they're not willing to do the work for just 1% of your investments annually.

My FA has 98% of our life savings earning 9-11% a year in fairly safe mutual funds compared to what I'm doing with the other 2%... trading naked option calls and making 275% a year right now.

So, I must say "ditto!" to Grizzly's advice. Start buying books on investing in the stock market and learn all you can ... assume it's school and you need to graduate with a 4.0 and study hard and long.

Then, use Yahoo! Finance to set up a watch list and do some theoretical stock purchases after you've learned the fundamentals. If you do this for a calendar year you'll see how much you would have made (or lost) and you'll have a much better idea of how the market works and how your "guessing" has to be very educated to make money month after month.

And while you're at it, find someone you know that studies the stock market and is heavily invested and ask them to teach you what they know about stock analysis... ignoring any stock tips they give you until you could have guessed it was a good time to buy that stock on your own :)

Of course, you can flip houses, start an eBay business, or do a number of things to make money outside of your regular job, but frankly, all of those look like too much work to me. I'd rather sit in front of my computer and wear out my index finger clicking on the "buy" and "sell" buttons.

[MikeinLA]

For savvy investors (like some of those here) who regularly beat the market, it is best to use their home equity to make even more and keep the home loan in place. For pussies like me who are idiot investors and hate even thinking about it, the peace of mind that my home is paid for is worth the small differential between the mortgage rate and the average 9% market gains over time.

Mike

[Perfectlap]

by the way FTD, look into a biweekly mortgage payment instead of the usual monthly payment. You'll pay it off quicker and save a lot of dough. And you won't be broke when all your bills pile on at the 1st of the month.

[Jump]

Randall, Perfectlap and/or anyone else, can you recommend some good entry level books on investing online? I'm putting away 15% of my salary into 401ks and other mutual funds but I'd like to start getting into stock investing a little more.

I've never been able to get myself to trust a financial adviser because I've always recognized that their first goal was their own retirement, with my retirement goals being secondary.

Thanks.

[FTD]

You guys are the best! I have SEP and Roth IRAs that aren't impressing me, so I have been stock piling for something I call OPM - Other People's Money. The idea is vacation rental property where someone else's wallet builds my retirement. I think in about six months the purchase market will hit a peak low and I want to be ready to move. The thing is, in the meantime, this stock piling isn't making whopper dollars so I am not real smart there.

I am big on reading. I have read every classic I ever heard of plus self improvement, life improvement, spiritual improvement.... so, duh! I should go get some investment books. I hear these folks on TV and they don't say anything that is new to me, but I bet buried in some chapters are some thoughts I hadn't looked at. Thanks for putting me in that direction.

The other thing about an advisor is they get a piece of my pie. Every day, someone is trying to stick their finger in my pie and get a cut, and if they are not a charity that I have a heart for, I really don't welcome them.

I was paying an extra 50% on my mortgage for a while, but chilled on that. I am an independent contract employee, and Feb looks like I will have to be finding a job, so having plenty on hand to keep the nerves down during unemployment is also a major self-confidence factor.

Its all a balancing trick! Thanks for getting me focused on paying down the mortgage again. The cost of interest on a 30 year loan is about the cost of a small house or some acreage, which I would rather have in my pie and not the bank's.

I have become a 986Forum addict. You guys are why. Thanks.

[Brucelee]

When you look at the typical 30 yrs mortgage, my recollection is that over that period, you pay 2-3 times in interest that you do in principal.

That varies with the rate, of course.

That is kinda of scary.

Best of luck!

[Brucelee]

I ovestated it a bit. But, it is still alot! :D

Results of Your Mortgage Calculation

--------------------------------------------------------------------------------

For the values you entered:
Principal= $100000
Interest Rate= 7.00%
Amortization Period= 30 years
Starting month= Jan
Starting year= 2007
Monthly Pre-payment= $0
Annual Pre-payment= $ 0.00

--------------------------------------------------------------------------------

Your monthly payment will be $ 665.30
The following mortgage would result for 2007 :
Jan: Principal: $ 81.97 Interest: $ 583.33 Balance: $ 99918.03
Feb: Principal: $ 82.45 Interest: $ 582.86 Balance: $ 99835.58
Mar: Principal: $ 82.93 Interest: $ 582.37 Balance: $ 99752.66
Apr: Principal: $ 83.41 Interest: $ 581.89 Balance: $ 99669.24
May: Principal: $ 83.90 Interest: $ 581.40 Balance: $ 99585.34
Jun: Principal: $ 84.39 Interest: $ 580.91 Balance: $ 99500.96
Jul: Principal: $ 84.88 Interest: $ 580.42 Balance: $ 99416.08
Aug: Principal: $ 85.38 Interest: $ 579.93 Balance: $ 99330.70
Sep: Principal: $ 85.87 Interest: $ 579.43 Balance: $ 99244.83
Oct: Principal: $ 86.37 Interest: $ 578.93 Balance: $ 99158.45
Nov: Principal: $ 86.88 Interest: $ 578.42 Balance: $ 99071.58
Dec: Principal: $ 87.38 Interest: $ 577.92 Balance: $ 98984.19
--------------------------------------------------------------------------------

And for the rest of the term:

--------------------------------------------------------------------------------

FOR 2007: Interest= $ 6967.82 Principal= $ 1015.81 Balance= $ 98984.19
FOR 2008: Interest= $ 6894.39 Principal= $ 1089.24 Balance= $ 97894.95
FOR 2009: Interest= $ 6815.65 Principal= $ 1167.98 Balance= $ 96726.96
FOR 2010: Interest= $ 6731.21 Principal= $ 1252.42 Balance= $ 95474.55
FOR 2011: Interest= $ 6640.67 Principal= $ 1342.96 Balance= $ 94131.59
FOR 2012: Interest= $ 6543.59 Principal= $ 1440.04 Balance= $ 92691.55
FOR 2013: Interest= $ 6439.49 Principal= $ 1544.14 Balance= $ 91147.41
FOR 2014: Interest= $ 6327.87 Principal= $ 1655.76 Balance= $ 89491.65
FOR 2015: Interest= $ 6208.17 Principal= $ 1775.46 Balance= $ 87716.19
FOR 2016: Interest= $ 6079.82 Principal= $ 1903.81 Balance= $ 85812.38
FOR 2017: Interest= $ 5942.20 Principal= $ 2041.43 Balance= $ 83770.95
FOR 2018: Interest= $ 5794.62 Principal= $ 2189.01 Balance= $ 81581.94
FOR 2019: Interest= $ 5636.38 Principal= $ 2347.25 Balance= $ 79234.69
FOR 2020: Interest= $ 5466.69 Principal= $ 2516.94 Balance= $ 76717.75
FOR 2021: Interest= $ 5284.74 Principal= $ 2698.89 Balance= $ 74018.87
FOR 2022: Interest= $ 5089.64 Principal= $ 2893.99 Balance= $ 71124.88
FOR 2023: Interest= $ 4880.44 Principal= $ 3103.19 Balance= $ 68021.68
FOR 2024: Interest= $ 4656.11 Principal= $ 3327.52 Balance= $ 64694.16
FOR 2025: Interest= $ 4415.56 Principal= $ 3568.07 Balance= $ 61126.09
FOR 2026: Interest= $ 4157.62 Principal= $ 3826.01 Balance= $ 57300.08
FOR 2027: Interest= $ 3881.04 Principal= $ 4102.59 Balance= $ 53197.49
FOR 2028: Interest= $ 3584.46 Principal= $ 4399.17 Balance= $ 48798.32
FOR 2029: Interest= $ 3266.45 Principal= $ 4717.18 Balance= $ 44081.14
FOR 2030: Interest= $ 2925.44 Principal= $ 5058.19 Balance= $ 39022.95
FOR 2031: Interest= $ 2559.78 Principal= $ 5423.85 Balance= $ 33599.10
FOR 2032: Interest= $ 2167.69 Principal= $ 5815.94 Balance= $ 27783.17
FOR 2033: Interest= $ 1747.26 Principal= $ 6236.37 Balance= $ 21546.80
FOR 2034: Interest= $ 1296.43 Principal= $ 6687.20 Balance= $ 14859.60
FOR 2035: Interest= $ 813.01 Principal= $ 7170.62 Balance= $ 7688.98

--------------------------------------------------------------------------------

Where the final summary is
Monthly Payment: $ 665.30
Total Interest:$ 139508.90(No pre-payment)
Total Interest:$ 139508.90 (As given)
SAVINGS: $ 0.00 Total Interest Saved, 0.00 Years shorter loan
2007 Interest $ 6967.82
2008 Interest $ 6894.39
Ending Balance Dec 2008: $ 97894.95
Average Interest Each Month: $ 387.52

[FTD]

beautiful! Tape that to the wall / mirror where you will see it everyday and see if it doesn't motivate!

[Gary in BR]

Personally,

I was in real estate sales for almost a decade. And though months of making more money than I needed and months of barely getting by I make a mental note of not having any monthly bills. I made a savings account of 3 months of bills.

Then I applied all of my extra money to paying off my car, then I rolled over the 800 per month payment and paid off my BMW X5. now that 800 + 600 (bmw note) is paid extra to my mortgage. All of my other bills are paid off and I own everything.

I feel better not having any monthly bills, and owning everything.

I know that I would do better saving-investing more money but my plan is after the house is paid off in a few years I can invest almost 4k a month and have no bills.

This plan works for me, I think you have to do what fits your personal style.

[Wonko The Sane]

There's a lot of great information on this thread. Thanks to all!

I'm just getting into the game (actually, I'm just really learning that there is, in fact, a game, and now I'm trying to learn the rules), so I'm about to start reading all the books i can get my hands on.

What website/company do you guys who manage your own stocks/bonds use? I've been thinking about setting up an etrade account, just to see how I'd do with "dummy" stocks.

[FTD]

[QUOTE=RandallNeighbour]FTD, to answer your original question...

So, I must say "ditto!" to Grizzly's advice. Start buying books on investing in the stock market and learn all you can ... assume it's school and you need to graduate with a 4.0 and study hard and long.

Then, use Yahoo! Finance to set up a watch list and do some theoretical stock purchases after you've learned the fundamentals. If you do this for a calendar year you'll see how much you would have made (or lost) and you'll have a much better idea of how the market works and how your "guessing" has to be very educated to make money month after month.

And while you're at it, find someone you know that studies the stock market and is heavily invested and ask them to teach you what they know about stock analysis... ignoring any stock tips they give you until you could have guessed it was a good time to buy that stock on your own :)
[QUOTE]

more brilliant advice that I can easily do.

And, as much as it goes against my logic, using home equity to make the down payment on rental property also has sense in it. Like someone said, "what's the worse that can happen? You have to sell?".

Also the SEP IRA allows me to put a tremendous amount of money into retirement investment and thereby give me some of my tax money back. No point giving to the IRS if I can give it to myself. But the downside is its locked up and the US market is weirder than we have ever seen before so I have my doubts - you know. ?

Sometimes all this thinking is too much. :)

[FTD]

What website/company do you guys who manage your own stocks/bonds use? I've been thinking about setting up an etrade account, just to see how I'd do with "dummy" stocks.

TD Ameritrade got rid of their quarterly fee for inactivity, so they work well for me.

[MartinJ]

Here are my Financial tips in priority order:

1. Make sure you have at least 3 months (6 months is better) worth of living expenses in a liquid safe investment (think credit Union). Save 5% - 10% of your gross income until you hit 6 months money in the bank.
2. If you have any high interest debt (credit cards, unsecured loans, car loans…) pay them off in the order of highest interest first.
3. Max out your 401k, IRA… pre Tax investments (Invest in a diversified mix, with a strong bias to stocks)
4. Pay down your house (I like the emotional impact!), if you have a 5.5% loan on a house and are in a fairly high tax bracket (don’t forget State income taxes) it is tough to get a 5.5% after tax return (think 8.5% to 9% before taxes) on a consistent basis (YMMV).
5. Have a separate (fun money account) I find this really helps me to ignore my other savings when I get a $$$ urge and it allows me some guilt free spending.
6. Have some fun with your money, high risk investments, F-Cars, P-Cars, M-Cars, B-Cars, wine, women, you can waste the rest!

[RandallNeighbour]

The contributors to this thread are some of the most balanced, level-headed people I have ever encountered. Pat yourself on the back!

And for anyone reading this thread that has a clear history of buying a stock and it taking a dump the day after it's been purchased, please PM me with the stock name immediately.

I'll buy an option put on it and one of us will make money, I assure you :)

[Brucelee]

The contributors to this thread are some of the most balanced, level-headed people I have ever encountered. Pat yourself on the back!

And for anyone reading this thread that has a clear history of buying a stock and it taking a dump the day after it's been purchased, please PM me with the stock name immediately.

I'll buy an option put on it and one of us will make money, I assure you :)


A couple of things. I have no debt right now, no car or house payments etc.

It is one of the most wonderful feelings in the world.

All my investments are in index funds. Cheap admin fees, lots of diversification, so these dips and peaks are smoothed out.

I like Index investment for long term investments. As Dr. Miller (Nobel Price winning econ. says "I do invest in a few stocks, but that is really gambling, which I enjoy. The rest of my money is in Index Funds, which is actually real investing."

[Brucelee]

Oh, and if you want to avoid a capital gains tax increase, vote for every GOP on the ballot! :D

[bmussatti]

I love DRIP account investing too. Great way to dollor cost average.

Dividend
Re
Investment
Programs

You can get some great companies to, like Intel, Home Depot, McDonalds, Medtronic, GE, Texas Inst., Walgreens, Wal-Mart, Pfizer, just to name a few. Plus, many of them allow you to directly purchase your initial stock investment from them, so you can open the DRIP account.

[Grizzly]

The guys are offering some great advice here...good solid stuff. I paid my debt down as well, but I did it slightly differently. Financially it probably wasn't the best move, but it offered a psychological benefit that kept me motivated.

Instead of paying off my bills with the highest interest rates first, I paid off the smallest ones first. Then, like Gary in BR said, I rolled the payment into the next bill to be extinguished. To bring it home, I wrote the bills on a piece of paper and put it up on the fridge. As each one was paid off, I crossed it off the list. When you get down to the last bill or two, the motivation to finish gets pretty friggin' high.

For the last decade, we've only had a mortgage payment. I'm torn as to whether to pay it down or invest. At 5.83% on a 30 yr fixed, it is easy for me to beat that in investment returns. By the same token, it would be a darn good feeling to own the house outright and have that extra 5k in my pocket each month. At the moment, I'm using a split strategy of paying the house down some, while also feeding the investments. It's not the best approach, but it'll work until I figure out which I'd rather concentrate on.

[Brucelee]

The guys are offering some great advice here...good solid stuff. I paid my debt down as well, but I did it slightly differently. Financially it probably wasn't the best move, but it offered a psychological benefit that kept me motivated.

Instead of paying off my bills with the highest interest rates first, I paid off the smallest ones first. Then, like Gary in BR said, I rolled the payment into the next bill to be extinguished. To bring it home, I wrote the bills on a piece of paper and put it up on the fridge. As each one was paid off, I crossed it off the list. When you get down to the last bill or two, the motivation to finish gets pretty friggin' high.

For the last decade, we've only had a mortgage payment. I'm torn as to whether to pay it down or invest. At 5.83% on a 30 yr fixed, it is easy for me to beat that in investment returns. By the same token, it would be a darn good feeling to own the house outright and have that extra 5k in my pocket each month. At the moment, I'm using a split strategy of paying the house down some, while also feeding the investments. It's not the best approach, but it'll work until I figure out which I'd rather concentrate on.


That sounds logical and balanced.

Good stuff

[FTD]

One more thing:

My aunt and uncle lived humbly and saved, saved, saved. A few decades later they paid cash for their dream home on the Florida intercoastal and retired. A year after he retired, he passed away. All of that responsible planning and he didn't get to enjoy his return. So I learned from that, too. Balance. That is why I bought the Boxster. It was out of character, it is a depreciating asset of significant $, but the joy of living and laughing and great memories needs to be considered.

I'm off to the bookstore to get some wise financial planning books. :cheers:

[MartinJ]

Must agree on the balanced life approach as well, no use working hard and not spending some of it, my wife passed away nearly 2 years ago and would have loved the Box, so I definitely inject a certain amount of live for today in my life!

On the house, until about 3.5 years ago I lived in Utah, I had a great house overlooking the valley and was well on my way to getting it paid for about now. Anyway the company wanted me move to Northern CA and made a nice offer so I went, The house payments hurt and the taxes are even worse (I have to put away $660 per month just to pay my property taxes). The plan is to move again in a year or two but I have been spoiled by the almost year round Boxster weather! Ah well it is only money!

[Brucelee]

Must agree on the balanced life approach as well, no use working hard and not spending some of it, my wife passed away nearly 2 years ago and would have loved the Box, so I definitely inject a certain amount of live for today in my life!

On the house, until about 3.5 years ago I lived in Utah, I had a great house overlooking the valley and was well on my way to getting it paid for about now. Anyway the company wanted me move to Northern CA and made a nice offer so I went, The house payments hurt and the taxes are even worse (I have to put away $660 per month just to pay my property taxes). The plan is to move again in a year or two but I have been spoiled by the almost year round Boxster weather! Ah well it is only money!


Ca taxes! Ah, yes.

[Jump]

One more thing:

My aunt and uncle lived humbly and saved, saved, saved. A few decades later they paid cash for their dream home on the Florida intercoastal and retired. A year after he retired, he passed away. All of that responsible planning and he didn't get to enjoy his return. So I learned from that, too. Balance. That is why I bought the Boxster. It was out of character, it is a depreciating asset of significant $, but the joy of living and laughing and great memories needs to be considered.

I'm off to the bookstore to get some wise financial planning books. :cheers:

Definitely lots of truth in that. It also explains as to why I bought my Boxster as my second vehicle. Balance is the key.

[Topless]

+1 on index funds. You don't need a financial adviser and you don't need to know much about stocks. Steady returns, very low costs, and very low risk. Just ride the world economy as it goes up over time and average 8-10% per year. 99% of my stock investments are in Vanguard index funds and 1% is play money.

I usually stink at individual stock picks so this works well for me. Last year my big play was to invest a little in the Shanghai index. So far so good. I re balance once a year or so. Day to day market trends just don't matter to me any more.

[xxxalexxxx]

The way i see it is I'm not really worried about paying off my mortgage off so fast, I bought my place, invested about 10k and put some work into it myself renovating it and even in this crappy real estate market in Chicago my apartment is worth 40k more then what I paid for it a yr ago.
As far as retirement funds go I'm 23- turning 24 soon and I set aside about 15% of what I make and in my "retirement fund" I already have well into the 6 figures. Thats my biggest priority to have about 10 mil (hopefully) by the time I'm about 55 in my retirement reserve because I dont wanna be 90 when I retire on 600 dollars a month lol.
So just read up and educated yourself about the finance and investment world and start invest about 10%-15% of what you make and doubling that as fast as you can and you'll be good to go for the future. I started investing when I was 16 so I had an early start but its never too late to start :-)