Perpetual Debt

[Bugzilla46310]

 

[DeepCMark58A]

Pay cash for your toys or don't play.

 

[airshot]

Having been a boat owner for well over 60 years, while raising a family, always had a separate budget for the boat. That budget never took away from family expenses, often worked 2 or even three jobs to fund what the family needed along with funding my boating hobby. Going into debt for boats was never on the list, unless I borrowed from my own savings and paid it back. As a tool make with access to a full machine shop in my working years, I often made rather than buy certain things and often made money making things for others. You don't need to be rich to own a boat, but if your not wealthy, you need to be willing to put in extra work !

 

[Mc Tool]

Or buy an appreciating classic ......look after it and you will make money when you sell it .......probly not so much with boats, but cars and bikes .

 

[dingbat]

I’ll go against the grain and say I’m a firm believer in not paying cash for anything if I have an option.

Guessing it’s my business background but cash flow (liquid assets) are more far more important than my bank balance.

 

[airshot]

When I say paying cash, it is a figure if speech. Most of the time I use my CC for the purchase then pay it off within 6 months or usually less. The reason is....if I have any issues with what I buy, the CC company will go to bat if there is an issue. Either stop payment, or hold payment, or even in case of a scammer to get my money back. And the other reason is the bonus bucks for using that card. With my various hobbies, I have been subject to scammers over the years, but my CC has gotten back every nickel I have been scammed out of. Private purchases don't count of course, your on your own there. Long term financing is reserved for homes and vehicles.
Hey....to each his own, but I have found having a good CC that protects your purchases is what works for me and the bonus bucks kickback can get me more toys to add to my collection.

 

[Pmt133]

I’ll go against the grain and say I’m a firm believer in not paying cash for anything if I have an option.

Guessing it’s my business background but cash flow (liquid assets) are more far more important than my bank balance.

I have a stand alone "in case of emergency break glass" bank account that I throw a few bucks into a week. I have the Roth IRA and pension on the other.

Cash is for eating out and fun things but the primary purchases, fuel, op costs, vehicle purchases (within reason) are done on cards or loans. Having the credit line and not needing it I felt was always better than needing and not having it. My last vehicle loan was a 0% loan... it was a joke of a monthly payment but I used the money I would have dropped up front for a lot of other things that netted me a better return on investment in the long run. It's worked so far.

 

[dingbat]

I have a stand alone "in case of emergency break glass" bank account that I throw a few bucks into a week. I have the Roth IRA and pension on the other.

We’re still a little more diversified…lol

Still have money, accounts and stocks spread all over the place. Meeting with our financial advisor this week to see if it makes sense to start consolidating for retirement.

Always took dealer financing for the discount then transferred the loan over to our credit union for better financing.

 

[Pmt133]

We’re still a little more diversified…lol

Still have money, accounts and stocks spread all over the place. Meeting with our financial advisor this week to see if it makes sense to start consolidating for retirement.

Always took dealer financing for the discount then transferred the loan over to our credit union for better financing.

They don't pay me enough to diversify more lol. I realistically have 25 years before I can consider retirement. My advisor is slowly investing and spreading things out that make sense for me but... now is (and isn't in some ways) the time to do that.

Not like I'll be able to afford a house anytime soon. Probably have to leave NJ at this point to do that.

 

[dingbat]

Not like I'll be able to afford a house anytime soon. Probably have to leave NJ at this point to do that.

Bought my first house (townhouse) with a down payment borrowed from my future In-laws at age 24.

Had to drive an hour each way to work, but that is as close as I could afford. Got a room mate and ate lots of boxed macaroni and cheese dinner until I paid off my future in-laws 3 years later.

 

[Pmt133]

Bought my first house (townhouse) with a down payment borrowed from my future In-laws at age 24.

Had to drive an hour each way to work, but that is as close as I could afford. Got a room mate and ate lots of boxed macaroni and cheese dinner until I paid off my future in-laws 3 years later.

I'm not paying 500k+ for a house that was 200k 3 years ago is part of the problem. My nor anyone else's pay has tripled in the last few years either. I'm not saying it can't be done... it's just is it worth it right now vs building a portfolio and waiting for the inevitable crash out and capitalize at a better time...

Coincidentally at 24, just out of college, I was on the verge of home ownership... then covid took that job. At that moment in time I backed out due to uncertainty of what I'd even be doing in 6 months and I kick myself every day for it... because it was right there and I didn't put enough trust in myself to get the job done. I should have just went for it.

And I'm not trying to whine... just venting my frustrations. You should be able to grind and be a homeowner. I just happened to screw myself this time.

 

[Mc Tool]

I'm not paying 500k+ for a house that was 200k 3 years ago is part of the problem. My nor anyone else's pay has tripled in the last few years either. I'm not saying it can't be done... it's just is it worth it right now vs building a portfolio and waiting for the inevitable crash out and capitalize at a better time...

Coincidentally at 24, just out of college, I was on the verge of home ownership... then covid took that job. At that moment in time I backed out due to uncertainty of what I'd even be doing in 6 months and I kick myself every day for it... because it was right there and I didn't put enough trust in myself to get the job done. I should have just went for it.

200k to 500k in 3 years is why you should have bought it .
I am fn lucky in that from 1989 to 2001 we rented a farm house in Southland for $20 a week , then my boss (a really good guy ) asked us to move to Nelson to manage a service branch and being as how Nelson was expensive he paid ½ the rent untill 2014 ( I had a motorbike crash in 2009 and really did only ½ a mans work for the last 5 years ) . When It became obvious that I was never going to get back to work proper we agreed to terminate my job and as Nelson was way to expensive for us ( the house we are in now in Southland would have cost 350k in Nelson ) we moved back to rural Southland in nov 2014 and bought an old (1947 , built after the war to get returned servicemen onto the land )house on ½ acre for 125k with a 100k mortgage which we paid off in 4 years . At that point I went to the insurance co to "re-do " the insurance thinking that now that the buckin fank is out of the picture I didnt need to pay for full replacement insurance (447k) .....but the value ....like if I sold it then I would have got 300k- ish , now its 400k .
My biggest regret in that in 1989 when we moved into that farm house I could have bought this house (or similar ) for 35k .
I tell my friends kids that the best thing they could do is to get on that real estate ladder asap. Nothing I can think of appreciates faster .

 

[Pmt133]

200k to 500k in 3 years is why you should have bought it .
I am fn lucky in that from 1989 to 2001 we rented a farm house in Southland for $20 a week , then my boss (a really good guy ) asked us to move to Nelson to manage a service branch and being as how Nelson was expensive he paid ½ the rent untill 2014 ( I had a motorbike crash in 2009 and really did only ½ a mans work for the last 5 years ) . When It became obvious that I was never going to get back to work proper we agreed to terminate my job and as Nelson was way to expensive for us ( the house we are in now in Southland would have cost 350k in Nelson ) we moved back to rural Southland in nov 2014 and bought an old (1947 , built after the war to get returned servicemen onto the land )house on ½ acre for 125k with a 100k mortgage which we paid off in 4 years . At that point I went to the insurance co to "re-do " the insurance thinking that now that the buckin fank is out of the picture I didnt need to pay for full replacement insurance (447k) .....but the value ....like if I sold it then I would have got 300k- ish , now its 400k .
My biggest regret in that in 1989 when we moved into that farm house I could have bought this house (or similar ) for 35k .
I tell my friends kids that the best thing they could do is to get on that real estate ladder asap. Nothing I can think of appreciates faster .

As I said. Kick myself every effing day lol.

 

[Mc Tool]

As I said. Kick myself every effing day lol.

Ooooh man aint hind sight a 5hit of a thing . I wish I had listened to my partner .......she wanted to buy that house in 1989 but I thought we had plenty of time and paying only 20 bucks rent ......and ,again, if I had listened to her in 2009 I would never have had that motorbike crash .

 

[jitterbug127]

Bust out another Thousand.
Sink a bunch of $ into an old turd. That's where I'm at. I've got way more invested in my old clunker than it even close to worth. That being said she works for my needs.

 

[Mc Tool]

Bust out another Thousand.
Sink a bunch of $ into an old turd. That's where I'm at. I've got way more invested in my old clunker than it even close to worth. That being said she works for my needs.

I presume you are talking about your boat. I think thats how cheap boats go, but like my boat owes me 7 grand....no 9 ( forgot the kicker ) but it got the marine radio gps/ff . Some guy up the road has over 100k in his , real flash , pays murderous prices for servicing .......and he hates me coz I catch waaaay more fish than him . Last time I seen him at the ramp I offered to give him a few fish so he would have enough for tea and he told me to #uck off ...with a bit of a grin....and took the offered fish .
End of the day a shitter might be a bit of a money pit in term of running cost percentage against actual value but still cheap boating ......didnt even mention insurance

 

[DeepCMark58A]

They don't pay me enough to diversify more lol. I realistically have 25 years before I can consider retirement. My advisor is slowly investing and spreading things out that make sense for me but... now is (and isn't in some ways) the time to do that.

Not like I'll be able to afford a house anytime soon. Probably have to leave NJ at this point to do that.

I can not imagine, I bought a house in 1992 it was a broken down hobby farm on the sand plain. Remodeled every room in the house fought back the brush and still hated it. 27 years of equity it sold in less than 24 hours for 3 times what I paid for it and was lucky during covid 2.75% interest half down on a lake place that has doubled in value in 6 years. My son in NE MPLS spends more on rent on a studio apartment than I do for my 4 bedroom 2 bath 2,800 square foot home with a 1/4 mile of shoreline. Not bragging I am blessed I know I am very lucky.

 

[Mc Tool]

I worry for young people here coz they need better than 100k cash deposit to get a mortgage now. By the time the average young un saves that they will need 200k .
Banks are now offering shared lending , where 2 or more peeps own the mortgage , which does get them on the real estate ladder .........untill they fall out of friendship or one of them wants to cash out (and then the lawyers take anything the bank doesnt ). I think its a bad idea.

 

[dingbat]

I'm not paying 500k+ for a house that was 200k 3 years ago is part of the problem. My nor anyone else's pay has tripled in the last few years either. I'm not saying it can't be done... it's just is it worth it right now vs building a portfolio and waiting for the inevitable crash out and capitalize at a better time...

Wouldn't count on a sizeable home market crash
Even in the foreclosure crash of 2008, values dipped 7.5% for a year before rebounding. That makes your $500K home $472K

My daughter and her husband bought their first home in the fall of 2023 for $635,000. The neighbor across the street recently sold their home for an all cash offer of $855,000. Pretty good ROI in 3 years.

Not typical by any means, but it happens when you buy a new home in a small, up and coming (revitalized) town "on the edge" of commuter range to the District of Columbia, suburban Maryland, and Northern Virginia when working from home becames a thing.

 

[dingbat]

I worry for young people here coz they need better than 100k cash deposit to get a mortgage now. By the time the average young un saves that they will need 200k .

Only need 3-5% for a conventional loan here
Need to put down 20% to get away from Mortage insurance preminums