Money thoughts?

TECHNOKID

gim54pod wrote: »

Yes i pay rent and have all my life, All i'm saying here is in my situation money wise i can't afford to take the risk on buying a house and then have it taken away because i can't make the payments, same reason for not investing money I just can't afford the risk. as far as your brother go's i don't know his financial situation maybe he just didn't want to take on that kind of responsibility or debt I know i don't. Now don't get me wrong if you can afford to buy a house you should do it. It's most likely a good investment in the long run.

"Wall street ****" Right off the top of my head "Bernie Madoff" for starters.
I don't invest so i haven't been taken.

But then i could just be full of brown stinky stuff. Hope I didn't piss anyone off here i didn't mean to.

Basically, if you can afford to pay for a rent all of your life (which by the way is a must) you shouldn't pass on buying a home. You have to realize there is no return what so ever of your rent cost while the house you buy has a return. Account for your lifetime rent cost (which is hard to do without adding some average yearly inflation %) and then compare with a 20 years of mortgage payments. Yes, once the home is paid off you have paid 3 or 4 times the price of your home but your home has increased in value and furthermore you have an ''elastic band'' on the portion of money you spent on your shelter. As pointed out, ''You just have to have an intelligent plan and execute it. '' and that means to acquire a mortgage specifictly taylored to your own budget. You have to make sure your budget allows for some end play in order to cover for any potential hardship.

I originally made the decision to buy my house when I came back to Canada and found out that in order to be able to rent the proper shelter for my young family (at home wife and 2 young children) I would have to pay in the area of 800$ a month. I bought a home that was pretty close to the same monthly payments. In those days, interest rates for a mortgage was at their prime. A year later, my wife had left and was alone with a young family to take care, debts and home payments. I went through many hardship times during the 20 years I've owned the house, never gave up and guess what, I now have something to show for my hard working life. My home is I believe worth double what I paid for 20 years ago. The hardship postponed my final payment on the house by quite a few years but I am still way ahead of what I would be if I rented versus buying.

You might be young now but try to thing of the day you will take your pension and try to imagine being rent free by then :cool: This is an investment and one of the best for a private citizen, just like extra pension (big $$$$) :cool:

I spent almost 20 years saving up 50k for a van i needed/wanted. That may seem like a long time but at least it's paid for and i don't have to worry about not being able to make a payment and having the repo guy showing up to take my van.

IMHO that 50K would have been far better to be invested in a decent home that gain in value rather than invested in a vehicule that actually looses value every year (even more the first few years).

inspiredsports

jdhdiggs wrote: »

Gim

Uh, actually, you sound very uninformed and idealogical. Don't drink the kool-aid...

smiling, , ,

hearingimpared

fatchowmein wrote: »

I'm middle-class, I'm married, I'm screwed.

I'm lower middle-class, I'm married, I have a kid, I'M FAT, I'm screwed!:eek::D LMAO!!!

gimpod

jdhdiggs wrote: »

Gim
Uh, actually, you sound very uninformed and idealogical. Don't drink the kool-aid...

Apparently I'm just a "very uninformed and ideological moron who's been drinking to much kool-aid" so be it. Everyone's entitled to there options. But it seems to me that this is a rather uninformed and blanket statement to make about someone who you know nothing about. Now if i was to form an opinion of myself it would be this "Opinionated, Bull Headed and Pessimistic" definitely not idealistic that's a young man's affection and i really do try and stay as informed as i can about things.

inspiredsports wrote: »

You give advice like, "If you can't pay cash for it, you don't need it." and, "Never ever spend more than you have."

Here is the post you refer to:

gim54pod wrote: »

I have a very simple philosophy when it come's to money "GIVE ME MORE:D" JK actually it's "If
you can't pay cash for it, You don't need it". I don't have credit cards and i NEVER will, and never ever spend more
than you have.

Please don't take this personal but what part of the word Philosophy did you not understand. One definition of it is "A system of values by which one lives" and the one that was meant. It was most certainly was not meant as advice.

Now as far as Mr. Regan, deregulation and Wall Street go's i'm only going suggest that you check out this link PBS: Explore a time line of video chronicling the tide of deregulation and derivatives. It's not all his fault but he is the one who opened the flood gates on massive deregulation across the board.

On to buying a house and making investments, Let's say i was able to do these things (by the way i really wish i could) but because of my situation as soon as i did they would become assets that would cause me to lose the benefits that allow me to exist. All i'll say about my situation it is I TRULY HOPE AND PRAY TO GOD that none of you guys or anybody you know ever ever end's up experiencing it. I guarantee you that it would at the very least turn your world upside down and forever alter your life.

Now i look at buying a house as buying a place to live out your life and die in (i figure if i'm lucky and my health holds out i've got 30+ years) not as an investment to sell later to make a profit. Now i'm not saying that making a profit is a bad thing if that's what your into good for you i truly hope you make a bundle. It's just not me and in this instance i wouldn't care about making a profit after all it's only money and you can't take it with you when you die.

Anyway i hope this didn't piss anybody off especially inspiredsports you seem like a pretty decent guy.
I'm out of here, I've have go pack for my week long annual evaluation at the VA that starts tomorrow (always fun NOT!)

madmax

My only question is why would you spend (numbers vary all over the US) $1K a month with inflation adding onto it each year for the rest of your life when you could have the same thing locked in at $1K a month and actually have a few hundred thousand to back you up later on? Lets face it, when you are old you either have assets and can do what you want or you don't.

gimpod

The problem is that i can't invest in anything because as soon as i do i will lose all my income. I know it sucks but that's my reality.

jdhdiggs

Well, excuse me... I was basing it purely on your first post which was, well, I stand by my initial assessment. Go read it again and think about how people will view you... Again, I didn't say you were, but you sound... Your follow up posts have just re-enforced this. Your own "defense" link doesn't even really support your initial position without a lot of spin and "but...but..but... and then's..." and ignoring the real world.

I sincerely hope your life turns around and you get healthy.

hearingimpared

jdhdiggs wrote: »

Well, excuse me... I was basing it purely on your first post which was, well, I stand by my initial assessment. Go read it again and think about how people will view you... Again, I didn't say you were, but you sound... Your follow up posts have just re-enforced this. Your own "defense" link doesn't even really support your initial position without a lot of spin and "but...but..but... and then's..." and ignoring the real world.

I sincerely hope your life turns around and you get healthy.

Sorry but I have to laugh because when I saw that;

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madmax

gim54pod wrote: »

The problem is that i can't invest in anything because as soon as i do i will lose all my income. I know it sucks but that's my reality.

So your moving out on the street soon? Na, you'll come up with that rent money somehow.

cstmar01

gim54pod wrote: »

The problem is that i can't invest in anything because as soon as i do i will lose all my income. I know it sucks but that's my reality.

huh?

ok if you don't have enough money to buy a house, or to invest, then how do you rent? Like you have to come up with the money some how, a job, social security, ect.

The whole point is rather than renting, in which you will never, ever own the property yourself, if you buy even just a small house, then when its paid off, its paid off. If you have a 2 bed apartment your currently renting you could just get a 2 bedroom house and rent out the other bedroom to your current roommate.

Yes there are some other added expense to owning your own house, however if you plan according it can work.


I would rather be old and live in my own place paid off then worry about paying some other creeper money and worry about it being raised the next month.

madmax

cstmar01 wrote: »

huh?

The whole point is rather than renting, in which you will never, ever own the property yourself,

I have lots of friends who buy a house for the sole purpose of renting it. They charge more than the mortgage to renters and when the house is paid off they can continue to rent it or sell it for the full value. One friend said "why should I pay for a house when someone else is willing to pay for it for me".

cstmar01

madmax wrote: »

I have lots of friends who buy a house for the sole purpose of renting it. They charge more than the mortgage to renters and when the house is paid off they can continue to rent it or sell it for the full value. One friend said "why should I pay for a house when someone else is willing to pay for it for me".

I agree the idea of buying a house and using it as a rental is a good idea. It can be a good investment for cash flow as long as you have a renter there and if there is not one you have enough reserves so that in case you have to pay the mtg yourself for a bit you can. Also if you can find a property at a low price to use as a rental can be helpful ect.

I ment its bad for someone to constantly being the one that is renting, not the one that owns the property.

disneyjoe7

I'm middle class, married, now divorced... House upside down, I'm F'd..

muncybob

I think GIM made some blanket statements and in the world of investments and such you simply cannot do that....there is no 1 size fits all. I also think GIM's life could be a whole lot better than it is hence the pessimistic view of such things. I too hope things take a turn for the better.
Having spent many years in the world of high(and not so high) finance I have seen a lot of people's lives ruined by mis-managed money and also being taken due to their ignorance(like paying a much higher int rate than they needed to) but I have also seen people lose out on opportunity to really make a decent return due to their overly conservative(pessimistic) view of finances. Losing out on an opportunity(be it real estate, stocks, etc) won't hurt you but mis-managing money and living beyond your means can truly make your life suck...or even in extreme cases it will end it.
Right now there are a lot of opportunities to make great investments, but as I was once cautioned...don't invest any money you can't afford to lose.

hearingimpared

I'm no Realtor nor am I highly informed about real estate but in the research I've done about real estate when I was interested and able to possibly get into (plus I have a couple of good friends who are real estate wizards) every time I would look into buying a house cheap fixing it up and renting to make money, I've been told that it the long hard way to make money in real estate. Plus you are a landlord and there are all kinds of bogey men in being a landlord.

The way it was put to me was to buy a beat up house in a good neighborhood. Put the money into it to make it livable and flip it and keep doing it this way and in no time you will find your self with lots of moola and be able to just buy good homes, foreclosures etc. cheaply (no fixer uppers) and flip them.

My 0.02 for what it is worth.

TECHNOKID

madmax wrote: »

I have lots of friends who buy a house for the sole purpose of renting it. They charge more than the mortgage to renters and when the house is paid off they can continue to rent it or sell it for the full value. One friend said "why should I pay for a house when someone else is willing to pay for it for me".

Friend of mine had a job with no retirement benifits and it wouldn't pay enough for him to invest (large family with many kids) and he showed me his 2 rented semi-detached (side by side) which he pointed out was his retirement fund. My body learn early in age from his own father. When money allowed him to buy a nicer house, he kept his old one and rented it. He was then approached by a pub that needed his land for parking lot. He got big $$$$$$ for the lot, we dismantled the house ourselves saving him the cost of subcontracting the demolition and he even made money out of the used material from his former house.

cstmar01 wrote: »

I agree the idea of buying a house and using it as a rental is a good idea. It can be a good investment for cash flow as long as you have a renter there and if there is not one you have enough reserves so that in case you have to pay the mtg yourself for a bit you can. Also if you can find a property at a low price to use as a rental can be helpful ect.

I ment its bad for someone to constantly being the one that is renting, not the one that owns the property.

That was a killer for me during my last year in the forces. I had rented my home for my last year with the intention of coming back, the renters wouldn't pay me, made damages to my house, had to get them evicted (cost $$$) and good thing I already had in mind to overall the home for the new family because it costed me big $$$ for damages. The end of that nightmare however paid off since I was allowed to claim some on my income taxes and that help bring my amount down (which was a go9od thing since I made much more than usual that year and the tax men would have got me big time :eek: ). So, my lost was somehow my gain...