First off, a few notes, and then an introduction.
NOTE 1: If you haven’t read Annoying Nomad’s article on retiring, do yourself a favor and go read it right now.
NOTE 2: Over the course of this series, I’m going to throw my financial books wide open. Some of the numbers will be guesstimated or altered to keep some of the mystery. The ones where magnitude actually matters to the story will be real.
NOTE 3: I’m not a financial advisor. The biggest lesson you should take away from this series is “don’t take my word for it.” Personal finance is learnable, and there are plenty of great resources out there to help you figure things out.
One thing has really struck me as I’ve gotten older. Calories and Dollars are actually quite similar in many ways. After starting GlibFit a couple years ago, I immediately felt a draw to putting together a personal finance version of it. At the time, my finances weren’t in amazing shape, so I shelved the idea for a while, waiting for a time when my GlibFin success story could be told. Of course, GlibFit was never about me touting my success (I’m still within 5 or 10 lbs of where I started on day one of GlibFit 1.0), but nobody wants to hear about personal finance from a broke guy.
Still, calories and dollars are quite similar. It’s not uncommon to see an obese person lose weight when they get their money under control. The same attention and self-discipline are required to achieve your goals with calories and with dollars. There are plenty of ways that you can look healthy (physically or financially), but be woefully unhealthy. And there are plenty of people out there looking to sell you on the latest fad diet or financial instrument that promises to make your woes go away, but never actually does.
In this 5 episode 7 episode 10 episode ok, I dont know how many articles there are going to be, I’m just going to write until I run out of stuff to say about personal finance. In this series, I’ll touch on various aspects of personal finance, including budgeting, debt, retirement, saving for purchases, etc.
I grew up in a fairly frugal home, my dad turning on Dave Ramsey’s CNBC show every night during dinner. I think most people know who Dave Ramsey is, but for those who don’t have his philosophy memorized, I’ll provide a quick overview. Dave believes that the average American relies way too much on debt and way too little on forethought. He has a program (the baby steps) that helps people who finally one day get sick of being in a financial mess dig out and get back on the right track.
I could recite the baby steps at age 15, and could talk for an hour on how the baby steps were so amazing. Out of college, I had minimal debt ($15k), and was rapidly paying it off when, well, life happened. I met my now-wife and we got engaged. Still, she had gone through Dave Ramsey’s class and her dad was frugal, too. Just a little pause in the debt payoff, and we’ll be able to leverage two incomes to be debt free in like a week. We planned the wedding on a budget and cash flowed it. I paid off her student loans as a wedding present. The only debts we had when we got back from the honeymoon were $7k in my student loans and $5k on a 0% loan for the engagement ring. Just buckle down for 6 months, and that could be gone. No problem….
Well, that freight train derailed all of 4 months after the ink dried on the marriage certificate. Within 3 years, I was seriously contemplating divorce because it was going to be cheaper than staying married. I remember a thought wafting through my head one day while I was decompressing on the back patio. I could give her all of the assets and take on all the debts myself, and I’ll be in better financial shape in two years than if I stick around. When I finally deigned to tally up the damage, we had over $550k in outstanding debt, over a quarter million of it being non-mortgage debt. With interest, that number crept up and over $600k before we paid it off (erm, it’s actually not quite that simple, but I’ll not spoil the story).
That poor naive new husband, bright eyed and bushy tailed, ready to jump into the deep end of the pool of life, didn’t understand three very important truisms. 1) That which is unwatched tends to go to shit. 2) Marriage amplifies what you put in, both good and bad. 3) Finance is more about discipline than intelligence.
You see, I was used to doing things at a breakneck pace. In college, I was an A- engineering student, worked full-time for 5 semesters, participated in multiple competitive engineering clubs, volunteered in the industrial relations office, did government research over the holidays, and still had time to work out 2 hours a day, play tennis and racquetball with my friends and date a high-maintenance girl.
The picture is probably well-painted. I knew how to juggle a bunch of different responsibilities, and I assumed that, as a newly married couple, there’d be some breaking in period (giggity) before we got the hang of things and resumed our breakneck pace.
As I started night school, I didn’t account for the fact that my wife has different strengths and weaknesses than I do. That well oiled machine that cash flowed a wedding was reliant on each of us playing to our strengths, mine being leadership and obsessive attention to financial planning and detail, hers being the ability to muster great determination to achieve a goal on the near horizon.
See, while I was blaming my wife (who does have a share of the blame for the financial mess), I was missing how much I set us up for failure. Rather than being a leader, I was being a dictator, not out of power lust or hatred, but out of necessity. I wasn’t around, so I wasn’t there to develop a plan together. Add in some medication of abandonment issues, some “gonna be a lawyer” entitlement, a heaping helping of spite, and an income that was all over the place, and it was the perfect recipe for a debt explosion.
Our conflict was rooted in the fact that our money wasn’t working for us. We had no plan, no long-term vision, and no accountability.
Dave Ramsey has a plan, a long-term vision, and a tough love version of accountability. He was exactly what we needed to dig ourselves out of this giant financial hole.
Dave’s plan is separated into seven phases he calls the baby steps. Discipline yourself into following them in order and you’re practically guaranteed to eventually become financially healthy. You may not end up rich, but worrying about where next week’s dinner is coming from is a thing of the past.
Baby Step 1: Save up a starter emergency fund of $1000
For some, this is the hardest part of the process. Getting away from the vicious cycle of too much month for the money requires a huge shock to the system. Often, it takes drastic change like a new job, moving back home, taking on a roommate, or moving to a cheaper city to release the ice dam. Sometimes, the logjam is at the implied baby step 0: get current on all of your bills.
For us, the prodigal children that we were, we still had the ghost of Dave Ramsey past haunting us enough to have a $2500 emergency fund in savings. Our leap of faith when starting the baby steps was to throw $1500 of that fund into baby step 2.
Baby Step 2: pay off all of your (non-mortgage) debts from smallest to largest.
I would say that this step is the start of the controversy, but there are plenty of people who think that the $1000 emergency fund is either too small or too big. Largely, they miss the point. It’s enough money to get you out of most run of the mill emergencies, but it’s small enough to make you scrappy, both in dealing with emergencies, and in getting the hell out of debt so that you can fully fund your emergency fund. As Dave says, it’s supposed to be uncomfortable.
Anyway, the controversy continues in baby step two, when the math geeks pitch a fit about inefficiently paying down debt. “But muh interest rate!” cries the pencil neck in debt up to their eyeballs. Occasionally you even get an arbitrager complaining about all the money being left on the table by not investing leveraged cash.
Emerging from all of that FUD is a package of Dave’s simple principles. Debt, no matter the interest rate, is risky because it makes you beholden to the lender. On average, people aren’t sophisticated enough to “win” against the banks when it comes to debt. People suck at measuring risk. Most people will use debt irresponsibly to extend their purchasing power beyond their means.
Dave’s plan says to ignore the interest rates and focus on the outstanding balances. No longer do we think in terms of monthly payments or of interest points. That car isn’t a $500/month car at 2.5%. Its a $32,000 debt that has to be repaid.
Dave’s program is heavily focused on baby step 2, so it’s hard to cover all the nuance in a few paragraphs, but the short of it is that you line up your loans by total balance owed, you pay the minimum on all of them, and then you dump every extra penny into the smallest loan.
Where do the extra pennies come from? From not having a life until the debt is gone. Discretionary spending: $0. Embrace the suck. Learn 50 different ways to cook rice and beans, because you’re not going to see the inside of a restaurant unless you pick up a second job there.
Baby Step 3: fully fund your 3-6 month emergency fund
There’s a bit of wiggle room here, depending on individual situation, but we’ve erred in the 6 month side of things. Basically, take essential monthly expenses and multiply by 6, and then save up that amount of money.
Baby step 4: save 15% for retirement
Up until now, everything has been done in sequential order. Baby emergency fund THEN pay off debt THEN full emergency fund. Now are three simultaneous baby steps that help prepare for the future.
Baby step 5: save for kids’ college
Notice the priority order here. Pay yourself first. Pay your kids for college next. Nothing is a worse way to leave a legacy than being a financial burden to your kids in your old age.
Baby step 6: pay your house off early
Dave hates 30 year mortgages, and I agree with him. It’d be nice to pay the house off in less than 15, so Dave has any extra money left after retirement and college aimed at cutting down the time until you own the house free and clear (sld’s apply). Now, this stage of life is meant to be enjoyed, so the intensity of baby step 2 doesn’t carry over here. If you can only swing the minimum, so be it.
Baby step 7: live and give like nobody else
Baby step 7 is the end goal. It’s the pot of gold at the end of the rainbow. Retirement is funded, kids are given a good head start in life, house is paid off, and your finances are about enjoyment and leaving a legacy.
Well, this article is already a mile long, so here ends the crash course in Dave Ramsey. Next episode will talk about the suck that is disciplining yourself to a budget.
What makes you think I have money?
Who Talked?
I’ll cut you!
More seriosuly, you may want to rethink step 5. College may harm the kids more than it helps them at this point.
As for the mone loan, I think 15 years is too long. I’m on track for 7-8 years. I passed the halfway point on the principal of the loan during the fourth year.
I disagree with the smallest loan first model. I am one of those interest rate guys, but I also didn’t pay minimum on any debt, I paid the next highest round figure above the minimum on those I was not focused on removing. One by one they all fell away, now I have a car at 0% and a house at 3.5% to finish paying off. I have enough cash on hand to eliminate the car loan, but I keep having to remind myself that I’m not actually gaining anything by doing that. If I were to throw my savings at a debt, it should be the house loan.
My current goal is to be debt free.
Having always been in debt to someone for something my entire adult life, I want to cross that threshold. Just $46k to go…
I’m guessing the point of the smallest loan first model is to cut down the number of entities to which you are indebted.
Trashy points it out somewhere, but
The main idea is that, for folks who aren’t good with numbers and have no training, this all begins as an emotional enterprise. They lose out on some money to do the plan, but they get some good feedback early and a sense of ability and accomplishment.
It can’t be over-emphasized how being hopeless leads to additional tragedy: it’s a lifestyle of mistakes . . . like addiction. Once a person gets it in his head that he’ll never be okay, never fix anything, that life will always suck, that payments will always be made, they continue to add more mistakes to the table because it really doesn’t matter to them. They aren’t calculating: they’re feeling.
One thing Dave gets right is simple rules. He’s got to make an emotional connection with a lot of people, and getting them to buy into a B- answer instead of an A+ answer gets more nibbles and, at the end of the day, more recruits . . . and more net victories.
A big problem for a lot of managers and salesmen is the complex delivery. Don’t sell the variable valve timing; don’t even sell the annual fuel savings; sell the highway EPA number.
^^better than I could’ve put it
I may just quote this comment rather than rewrite it in the next article.
. College may harm the kids more than it helps them at this point. – not if the daughter is fit and starts an onlyfans
Brilliant!
*salutes*
Huh. I had not heard of that particular site. Upon googling it, I believe that, rather than following the baby steps, I’d be better off just getting some breast implants and an onlyfans site.
Most of the college savings plans now allow you to pay for apprenticeships and trade schools with the funds as well as traditional college.
You are being a bit too literal UCS. Many kids will go to college. Guiding your kids toward an appropriate education and the right school is very important. For some kids, trade school is a better route. Some will join the military. Some will skip all post-H.S. education and go into the workforce. Dave isn’t demanding your child take a certain path. He is demanding you a financially prepared for what will come.
That reminds me – why is the parent paying for any of that. Kid should be working by then.
Agreed. Other than living at home for most of it, I paid for my degree myself. I won’t discount the value of living at home for free. I was also working almost full time throughout most of it.
I was at Target one December Christmas shopping and I was at the electronics counter. Two dude employees were talking, not really paying attention to me, but that was okay because I was eavesdropping. Anyway, one of the dudes was bragging about his student loans as a measure of the value of the education he was getting (pre-med, I think) and the other was mostly listening. Then he said something like, “Yeah, that’s not my way.” “Well, how else do you do it?” “Work and pay as you go along.” “Dude, what?” He was truly astonished that there was ANY other way. Of course, I chimed in and agreed with the pay-as-you-go kid and told him he was doing a good job.
When I re-fi’d my house from a 30-year to a 10-year, the cunte at the title office when I went to sign the documents said “There’s something wrong with your paperwork.” I was thinking I have the simplest paperwork ever, how could there possibly be a problem. “Your monthly payment is going up. That can’t be right.” I said, “No, that’s exactly what I’m trying to do – pay more each month to avoid 200K in interest payments. I could just do it without going through this whole exercise but it’s a matter of discipline.”
She replied “I’ve been doing this for 5 years and I’ve never seen anyone’s monthly payment go up.”
I said nothing, I hoped my facial expression said “The country is doomed and idiots like you are the reason.”
Our monthly payment increased when we refi’ed from 30 years to 15. It took some effort to get the agent to shut up about reducing our monthly payment by starting over with a new 30 year loan.
Debt, no matter the interest rate, is risky
Almost no one accounts for risk. If you point out risk or the waterfall of problems begat by a failure to respect risk, you’re an asshole (even if you spent your whole life avoiding that same risk and begged them not to do it).
You want to own a house – buy one you can afford. Don’t want to own one? Then rent, for eternity. Whatever you do stop thinking of your house as an investment.
^This. A house is not an investment, it’s a place to live.
As far as I’m concerned, a 30 year mortgage is a fixed rental agreement, the advantage to true renting being my payment for my housing will not go up. Disadvantage is having to deal with maintenance and property tax.
Maintenance: better to deal with it yourself than the half-assed job the landlord is going to do.
Property tax: The payment for your housing WILL go up.
I agree, with one exception. If you you buy a serviceable relatively undamaged house at a substantial discount, it is indeed an investment.
The return on investment isn’t cash or equity, it’s someplace to live for however long you’re in the house.
^this, so much this,
And you keep the cost fixed.
No.
No, no, no, no, no.
Ask me how I know.
This house bankrupted us. Now, mind you, it was stupid to buy this house, but there is no such thing as a fixed cost with a house. I can tell myself, “We got a lemon.” Okay, but we should’ve gotten out years ago but we held on, thinking things were going to get better.
They did not.
*in most cases.
“Houses suck!”
/Mojeaux
I realize I am an outlier here at Glibs (on most things, really).
Don’t JB us Mo!
Not everyone can be a bitter misanthropic loner with no family and no life.
Oh no! No, no, no.
Financial discussions are difficult at the best of times and right now I am enraged at myself. I just misplaced $10k in cash 2 days ago and I can’t find it.
I make bad decisions and I have no discipline. That makes me an outlier here.
I’m sorry. 🙁
No need to be sorry that you’re not a misanthropic loner! We need better humans than us around or this place would be a real cesspit.
“And you keep the cost fixed.”
County Assessor laughs his ass off at this.
*Shhhh*
My tax assessment is less than half the sale price.
A non-sequitur, UCS
The point is the assessment goes up so the property tax goes up so the cost is not fixed.
You may recoup when you sell the property, but then there’s capital gains tax. Even if your property value goes up at exactly the rate of inflation, you will have “made” money when you sell and therefore the inflation-only “profit” is considered a capital gain.
No, a joke.
My beef isn’t with the assessor – it is the F&(*ing school district that can raise the mil rate, and has, each of the last 3 years.
Agreed, I was just trying to keep the reply short.
We sold our first house for 70% more than we paid for it. And that doesn’t include the settlement with a developer (another 49% of the purchase price). But we definitely could afford it–our down payment was 50%.
part of what got us out of our financial mess was selling 2 houses (in succession, not simultaneously owned) for substantially more than we bought them for. first one allowed us to buy the second one, and the second one netted us the cash necessary to pay down a large portion of the debt.
Flipper!!!!!!
*cackles and splashes water out of the tank*
I disagree. Anything with that much money in it is an investment. It’s not necessarily a good investment though. Most people think it is, but for many it is not. And you shouldn’t count on it being a good one.
Houses aren’t an investment, they are a declining asset, just like a car, only slower.
Land, on the other hand, is an investment. But not the land you live on, but investments are stuff you want to be about to make liquid in a reasonable* time frame.
“Whatever you do stop thinking of your house as an investment.” I keep hearing this. I think the Rich Dad, Poor Dad guy said it, too, but I haven’t read him.
I don’t understand. I was painting a classroom this week, when the teacher came in and cleared out her stuff. She told me that she and her husband had enough equity in their house that they could sell it, and buy a house in Florida for cash, and that’s what they were doing. Dropping a $1200 per month bill while owning your house seems a pretty good investment.
What am I missing?
While you can (often) expect a house to increase in value beyond what you originally paid for it, its purpose is to provide shelter, not provide you with an increase in value.
If you think about it a bit more, it doesn’t generate cash flow, and the simple math of “I paid 200k 10 years ago and I just sold it for 300k” doesn’t really mean you made 100k on it. Over that 10 years you have maintenance expenses, property taxes, inflation, and a bunch of other things that eat into that 100k. Yes you still would have paid to live somewhere else, and you do have to factor that in. Just saying its not simple math of 300k – 200k = 100k profit.
Sometimes it works out great, often it doesn’t work out nearly as well as simple math makes it look.
Nothing wrong with investing in real estate, just leave the primary residence out of it.
I am not sure I got how no debt turned into 500k of it but I’ll read again.
I need to cut down on the whiskey budget but that aint happening. My retirement plan is drinking myself to an early grave…
I needed to save some content for the debt and repayment article in a few weeks!
If it doesn’t involve a few cars…then damn, what the hell did she (you?) buy.
two cars, law school loans and some credit cards.
That may be the most Glibertarian retirement plan.
Pie, I think you missed the part about “high maintenance girlfriend.”
*nods sullenly*
I would’ve graduated debt free from undergrad if I had never met her. She was never a keeper anyway, so it was just money down the drain..
*flashes back to a particularly expensive lady gaga ticket that I bought her*
Meh. You lived, you loved, you learned.
You’re single aren’t you?
I have 0$ debt, and had enough money saved to help Bella, so it’s back to the drawing board for my down on the house,
I also have no credit to speak of,
Debt
Also: the obverse of the no-debt coin is cash. People in debt compound their tolerance for risk, whereas paying cash on the barrel-head for most things clarifies finance, and life, wonderfully. When you have cash, you love cash, and you loathe letting go of cash.
I’ve trained NewWife how to handle some conversations to help prevent her embarrassing others, from setting herself up as seemingly arrogant or high-horsed. When you roll up in a new car, someone inevitably says something like: well, I just hate a car payment; to which, of course, the correct answer is “I know what you mean” and then change the subject.
Strangely enough, I don’t find that to be true.
Maybe I have to take the cash out of the bank and have it in physical form, but pretty much all the rest of the time, it’s an abstract number and it doesn’t impact my willingness to spend it.
there are two types of people, I’ve found. type 1 will swipe the card without feeling that pinch of loss. Type 2 feels like cash is burning a hole in their pocket. Wife is type 1, I’m type 2. she spends in cash, I use a card.
I’ve only had one car loan. Every car I’ve paid except for that one I paid in full in cash. Yep, even the new ones.
That one car that I borrowed money for I had the cash to pay cash. I wanted to get the loan on my credit report since I had little credit at that point beyond one credit card which I hadn’t had for long and my student loans. My first car loan payment paid off the loan.
When my kids asked me to get debit cards for them (linked to their own accounts) I’ve said no, I want to learn to feel the pain of letting go of cash. Once you learn that, maybe you’ll be ready for a debit card.
My son has learned the pain, and has even said he’s not ready for a credit card. Now if only I could motivate him to get a job.
My daughter spends like a drunken sailor, so she’s still not ready for a debit card. On the other hand she’s motivated to get a job, and had a well paying job before the lockdown.
“what’s the best kind of car?”
Paid off.
^^^This^^^
another similar one is “i can’t afford it”.
“do you want to go out for drinks Friday night?”
“sorry, I can’t afford it”
“oh, I’ll be glad to pick it up for you, and you can get me next time”
“no, you don’t get it. I could write a check right now and buy a brand new car, if I wanted. I don’t have enough money allocated to recreation this month to go out for drinks.”
When all of your money is off making you more money… you’re broke. I’m broke, just ask my wife.
And thanks for the Lesson Trashy!
looking forward to the next one,
I’m trying to melt the ice in this bottle so I can drink it… and I keep putting it in a thermos cup where the heat has trouble getting at it…
if the ice melts the souls escape before you can consume them
Dave hates 30 year mortgages, and I agree with him. It’d be nice to pay the house off in less than 15, so Dave has any extra money left after retirement and college aimed at cutting down the time until you own the house free and clear (sld’s apply). Now, this stage of life is meant to be enjoyed, so the intensity of baby step 2 doesn’t carry over here. If you can only swing the minimum, so be it.
I like the plan in general, though here I’ll break.
I have no intentions of staying in my house for the long term. I view it as a place to live that I need to sell, so I looked for something that didn’t show well but would a) show well with a little work and b) be something a small family (given the area’s demographics) would be interested in. The house is a bit big for me, but I think a family would love it. Given my extremely low interest rate, compounding via dividend payouts on investments, and desire to not stay over the long term, I can’t justify paying extra on the mortgage and instead put that money into the stock market.
For people in other situations, paying off the mortgage early might be a good idea but I can’t justify it for myself.
I replied to the comment about work in the other thread. If that acquisition in NH was two years ago, we should chat. The powers that be have my e-mail address and I have no problems with them giving it to you.
I’m at the point I have the cash in investments to pay off the mortgage, but with the low interest rate, and inflation. I prefer to make the minimum payments on the mortgage, and throw excess money into savings and investments. The mortgage is the only debt that I have (CC’s get paid off on a weekly basis, it helps me track my finances better then doing it monthly). I also save singles I get as change, and those get taken to the bank when I get up to $250, that gets split up into an entertainment fund and an on hand home fund for small emergency projects (large ones come out of the emergency savings, and that gets built back up).
I’take a similar view.
But don’t ever lose sight of when your money is saved for. Regardless of the need or amount, at some point you don’t have time to recover from the dark side of the business cycle for some outlays; the place for those nearer outlays might not be equities.
Yep, I’ve got a fairly healthy cash cushion as well. One of the neat things about the robo-advisors is that if you put in a date for the funds, they’ll start shifting the allocation as you get closer to it. Will they beat a monkey picking stocks, don’t know, but it’s worked so far.
Dave’s implying that most people make worse decisions with a 30-year loan than a 15: they buy too much house or too-upscale features for their earning power because the payments make it easy. It’s a version of my cash-on-the-barrel-head perspective, and that’s where he’s headed: if you have a dream house, fine: pay off your starter house, save up for the dream, and pay cash for it then . . . . which, again: that’s a very hard pile to part with for most folks.
As to risk, rent is a certainty if you don’t own, so I think mortgages make sense. If you stay somewhere a long time, school quality changes, plants close, tax rates change, governors changes . . . so there is some risk.
I see.
I didn’t think that way since I had already come up with a plan and had a price range in mind that I was willing to pay.
This.
Now, there can be some wisdom to the idea of getting a 30 and paying it like a 15, as it provides some built-in hard time insurance as you can drop back to the 30 year payment if needed.
But, as you already stated, the idea is the home purchase should already be modest.
*looks up acquisition date*
Yep, we should talk. You can reach me at this address:
5v8tz4onh9so@opayq.com
Mail sent.
I get depressed thinking about money because I had a bunch of crypto which I sold in a bout of depression much cheaper than I could have. And now I just relive the past in my mind thinking how i could have done things better instead of thinking of the present or future. But the whiskey helps. If I was smarter and luckier in 2017 I could have had a couple of hundred thousand right now. My conclusion was I will always fail so stop trying.
And now I regret posting this.Please ignore.
Hey, can I sit by you?
Scoot over. 🙂
I remember hearing about bitcoin when it was first starting out, when it wasn’t even really traded yet. I contemplated setting up mining on it, looked it over, and thought, “It’s a neat idea, but it’s not going anywhere.”
You can’t beat yourself up about those gains you could have had, because most rarely celebrate the losses you never had.
I remember hearing about bitcoin when it was first starting out, when it wasn’t even really traded yet. I contemplated setting up mining on it, looked it over, and thought, “It’s a neat idea, but it’s not going anywhere.”
#metoo
It was at $4…. I remember having a long conversation with my brother about throwing a thousand at it just for fun. Obviously I’d have sold when it had gone up by an order of magnitude. To think I’d have held on to the 15k range is wishful thinking.
I have made many bad financial decisions. It’s absurd that I didn’t retire from full time work years ago.
But I learned one thing: don’t look back and regret and stew. Learn something from it, sure.
I chuckle at the green eyeshade guys arbitraging interest on their loans against each other, rather than doing the psychologically effective Ramsey approach. The amount they could save on interest is likely trivial, and by playing games rather than paying them off, they are most likely to wind up paying more in interest.
People who borrow to invest just have a very different risk profile than me. I say that, but then I’m paying my mortgage on schedule and putting the rest into retirement savings, so I’m kind of doing the same thing. I’ll pay the mortgage in two years when I retire, and by then our retirement should be adequately funded (and sheltered).
I’ve never Ramseyed, but I’ve never really needed to. I like his approach, though.
We are on step 7 now, but it took alot of DIY work on cars and houses, forgoing vacations, buying the biggest house you can afford, etc.
Along the way we also purchased thing in life that give you back more than they take. I like motorcycles and shooting. I buy both only with cash or cash equivalents and both allow me the ability to take cheap vacations and relax on the weekend without spending $500 a day on hotels and airfare. My wife works out and gets a personal trainer, monthly massages, and hair appointments with no conflict with me.
All together these things cost less than a trip to Disney every year or a ski week in Colorado. Plus they provide additional mental and physical value to us both that doesn’t evaporate afterwards.
Correction, not buying the biggest house you can afford. Certainly not buying based on the amount the bank will loan you.
I had that argument with the realtor, the girlfriend, and the bank. You qualify for X*4, why are you only looking at houses at X? Because, that’s the amount I’m looking to pay, and the monthly payment I feel comfortable with.
Same here…why you no wanna 10000 sqft house?! Uh, cause I like food and beer and hookers and blow?
The girlfriends made rumblings about a “bigger house”. There’s her and me. We don’t need a bigger house. She used to talk about if I wanted to live closer to work… that’s gone now at least.
We were renting a 900sqft condo with 5 of us living there before we pulled the trigger buying our house. 1 15yr old and 2 12yr olds in one room was enough for us to do so.
But we waited for what we can afford in the area we wanted. For a year we cancelled all the extras…cell, cable, eating out, etc.
Its just disciplined thinking
Which we accomplish by *checks proper media terminology* nearly 3 times our sqft and only pay an extra 1/3rd of our rent payment. Couldnt pass that up
My required mortgage payment on my two bedroom house is 2/3rd of what my rent was for a one-bedroom apartment (and they were about to raise it) I pay slightly more than what the rent would have been to drive the loan into oblivion faster.
This I think is a very critical thing
Nothing cramps your ability to save and build wealth like a large payment taking 25-35% of your income that you can’t easily get away from.
This, I wanted a house I thought I could afford, not one the bank thought I could afford.
I’m on the other side of the 30 yr loan argument. You’re most likely getting the loan at, or near, inflation and you get to write off the interest. on your federal income taxes. I have a couple of good friends who have huge home mortgages and all of their rental properties are paid off.
There’s a pretty good argument to be made that at these low of interest rates, you should always carry a note on your home and have those funds invested in low risk investments, SP 500 or actively managed rentals.
I believe (and this is my personal plan) that the only reason you should ever have your house paid off is if it’s to pocket and invest your home owners insurance instead of throwing it down a rat hole.
I don’t trust investments, they always seem to shrink instead of grow.
I generally stick to mutual funds and robo-advisors. They’ll go up and down, but dollar cost averaging is a friend, and rebalancing is also a good thing to do.
Vanguard is my go to. Almost 0 in management fees, easy online management and no one calls me to bug me.
SP 500 or small caps all the way baby. Granted, the VAST majority of my money is tied up in less conventional investments right now.
I do like to gamble with the stocks, but that’s fun money.
“I don’t trust investments, they always seem to shrink instead of grow.”
10 years. When you’re setting out to invest in a major revenue stream, the magic number, is 10 years. 10 years seemed like a long time, 10 years ago.
Buying a rental property, doing you due diligence and assuming you don’t find the diamond in the rough? Give it 10 years.
Maxing out your 401k? 10 years… you’ll be able to really see the difference.
You know a craft? Starting a small business or side hustle, 10 years of good hard work and you won’t have enough time to take all of the referrals.
I have 1 caveat… DO YOUR DUE DILIGENCE. Math isn’t hard and there are a lot of historical numbers out there to give you some best/worst case scenarios. Start small with a realistic goal in mind. You can’t play the game if you never show up and it’s hard to play well if you’re not properly equipped.
Leverage magnifies both profits and losses. Looked at purely as a numbers game it magnifies losses a touch more than wins because of the cost of money, but the degree of confidence you have in the chance of profit can arguably offset that disadvantage and make leveraged investment seem a reasonable choice. The problem is similar to the problem with gambling against the house. You have limited resources, so a streak of bad luck can wipe you out before the odds edge you have banked on can cash you in. Additionally there is a life cost to being in debt. It reduces flexibility in a variety of ways. Finally, discipline is hard to maintain with exceptions. If you set hard and fast rules maintaining discipline is just a matter of doing what you set out, when you add in more caveats and exceptions you blur the lines and for many people it is simply easier to stick to “no debt” than to “only debt that meets certain criteria of worthiness”.
Make your own choices obviously. There are plenty of people who have the savvy and self discipline, and risk tolerance to use leverage successfully, but as general advice to the public, “debt is bad” is good advice, because 90+% of the people out there will use the blurred lines to sink themselves under foolish debts. I speak from painfully earned knowledge. *glares at margin loan
I’ve been pretty lucky with things, but I remember a girl I was dating 3 or 4 years ago pulling out a credit card I’d never seen to pay for lunch shortly before she broke up with me (I’d known her for years, so we knew what was in each others wallets). I remember warning her the last time I saw her to be really careful of credit cards. I saw her a few weeks ago, and in catching up found out she’d racked up about 15k on the cards, it really kind of broke my heart for her – that’s a bad position to be in. So even though as I said below I take the view that debt can be put to work, I completely agree that for some people it’s probably not a good idea.
Yeah, I’m more on your side. There’s risk with everything, and I’m a believer in having emergency plans, but it doesn’t seem to make complete sense to pay off a mortgage faster right now when rates are so low. Although, some people psychologically seem to not want debt, which I can completely understand.
But, debt per se isn’t bad – although debt for frivolous things I would avoid like the plague.
I was working with a home equity loan prepayment and default model (I work for a bank) last fall, and some of the data records had multi-million dollar balances with relatively short repayment periods – I guess some wealthy people don’t like paying cash for things, because they’re getting more of a return out of it than they’d pay in interest on the equivalent loan
Although, some people psychologically seem to not want debt, which I can completely understand.
This is me. I understand the argument for investing the difference, but I wanted (when I owned a house) that payment to die.
Same with a car payment. Sure, I could theoretically have a few more dollars right now if I played the game right. Instead, my car payment is $0. I much prefer the free cash now than the higher retirement account balance.
you get to write off the interest.
Not so much these days.
Yep. Two years in a row using the standard deduction.
Agreed.
#MeToo
Debt is risk. Period.
The risk you take with a big mortgage is an interruption in your income that you can’t cover with savings.
Mortgage interest is wasted money. Sure you get a tax deduction, but it never saves you as much as you paid.
Can you arbitrage what you borrow in other investments? Sure. But we’re back to risk. Not my thing, but that’s just me.
I do like thoughts on 10 year time frames. I’m starting to think about what I will do when I retire, which will be from full time office work. I’ll have at least 20 years of productive juice left in me, and no clear idea what I will want to do.
In this morning’s thread there were a lot of anecdotal stories about yard signs.
This summer I have driven nearly 2,000 miles across this country from South Florida all the way up to the Canada border. I have not seen any evidence of Biden support. In Superior Wisconsin there is one sign that is hand-painted and says vote Democrat. Mile out on area lakes around Northwestern Wisconsin and Northeastern Minnesota oh, I have seen many Trump Flags.
Back in South Florida, I live in the heart of Lefty country. When I left 3 weeks ago I had yet to see a single Biden bumper sticker. There are loads of trump Flags on the canal side of houses and on boats around the area.
Back in 2016 I predicted that nobody would actually vote for Trump. But going into the election, I posted here about noticing that there were very few Clinton yard signs and enough Trump signs to notice them. If you are posting a trump yard sign in Broward County Florida, you are making a very bold statement.
But even in these areas, people are very circumspect about talking politics. I ran into a guy from just north of Minnesota who owns for restaurants the other day hiking with my family. Our kids were playing together in a waterfall for about an hour before we dared approach the subject of politics. I was asking how business was and he kept edging up to saying something negative about the progressive leadership in Minnesota but wouldn’t quite do it. Not until I made some libertarian comments about the political class in the media being completely disconnected from what the people are thinking. Then we had a nice talk about politics. He is convinced that there is a lot of resentment against the media and the left out there and he is plenty motivated to turn out for Trump.
We shall see…. But I am confident that the American people are nowhere close to where NBC news keeps telling me they are.
It’s not surprising to see Trump flags and signs in the Metro Boston area. Biden signs are non existent. Though, there are lots of BLM signs these days.
BLM = Biden Loves Marxism
My anecdotal addition: I’m in a medium-sized non-suburban town in Georgia. There’s one house i know of that’s had a Biden sign up for months and months and months. I’ve seen one car with a Biden bumper sticker. The visible level of support is less than even the Hildabeast was getting. Trump stuff’s reasonably common everywhere I go.
I’m one of those libertarians who didn’t vote for Trump (Ben Sasse instead) last time around, but will this time. RBG factor and all that. I know a few deep Proggies from work, but most people are silently but strongly on the Trump train. Very, very much so. They know the rona-panic was deliberately to wreck the economy. They know the riots are orchestrated by the donks. And they get that while it’s done “to hurt Trump”, it’s truly done to hurt THEM.
They’re quiet for now. But they’re there.
Yeah, the ‘Vid and the rioting have made the position that “They’re not after Trump, they’re after you and he’s just in their way” more plausible.
I’m in the SF Bay Area. My neighbor has a Trump flag. One of the ranches I ride by had both a Trump flag and a rainbow flag. I still haven’t seen a single Biden bumper sticker or flag. I’m under no illusion that Trump will win in California, but there is a definite difference in enthusiasm.
I’ve seen a few “ByeDon” bumper stickers, but I live near the CHOP.
Don Escaped CHOP?
Two things:
1. The way people are getting cancelled and fired for any opinion these days probably spills over into the poll answers. They may decline to answer or lie to the pollster just to avoid admitting they will vote for Trump.
2. Given the amount of fraud I expect in this election cycle, reporting an enormous Biden lead is probably a way to suppress Republican votes and cover-up vote-counting shenanigans.
BTW, great advice Trashy.
I fell into some poor habits right out of college as I started making money and did what I told my self I wouldn’t do. Buy that new I just got my first good paying job new car. Cars are/were my down fall in the early to mid 2000’s. I had a hard time passing up low interest car payments if my car was over 100K miles. Both my wife and I drive over 30 minutes each way to work and I wanted to prevent being stuck due to breakdowns or needing to get a new car if one is failing.
We started pushing the cars to beyond 150K before we considered a new one. My credit and negotiating skills get much better the older I got, so now the car dealers call me when they have a good deal for me. Building relationships are underrated for the frugal consumer. I have gotten some tremendous deals due to building strong relationships with dealers, contractors, and service providers. The key is to only take the deals when you need what they are selling and if it helps build your relationships.
yup: another advantage of cash
I’ve bought twice from friends who were trying to unload low-mileage cars due to lifestyle changes. I didn’t need either car: it would be an extra for a couple of years until needed. Buying when it suits you is a sweet lever.
I got my eye on my buddy’s BMW 4 series Coupe with all wheel drive and a 6 speed manual. He doesn’t keep cars long and I know what he paid for it.
Relationships are important for car and home repairs
Going OT, the Bee delivers again. How do they do that?
Damn! That is a 10.
I just pictured Biden with an onion on is belt.
Interested in hearing what you have to say about student loan debt, do you think its “special” or not. IE, should it be lumped into the consumer debt to be paid off in Step 2 if it is part of a capitol investment in future earnings (aka law school, I assume).
in civilized Romania we don’t have student loan debt
How barbaric.
if you see the quality of the Polytechnic U of Bucharest you would realize no one in their right mind would go into debt to pay for that
You also probably don’t push everyone to go to college.
FWIW: Ramsey would include student loan debts in consumer debt to be paid off.
Here’s a typical answer: https://www.daveramsey.com/askdave/debt/starving-with-debt
The problem with student debt is that you cannot discharge it. So your flexibility on that front is extremely Limited.
Capital investments buy capital assets. Your degree is not a capital asset.
some degrees don’t even contribute to good will
Dave points out the huge risk in student loans: so many students never finish the course of study, and, with many degrees, the education’s value is someone all-or-nothing
Tangentially related: Before you lend, make sure the companies you lend to are goodthink lion-towers.
CBS is breathlessly reporting as many as ten entities identified as hate groups by the SPLC have received loans from the PPP program. Potentially ten million dollars, out of who-knows-how-much.
Oh, infamy!
The SPLC criticizing others over financial dealings just fried the hypocrisy cortex of my brain.
Dave has a great program that gets people in a position to win financially.
Wife and I are onto paying off the mortgage early. We slacked after paying off all loans and took one out to buy a vehicle, that was paid off in short order. Totally built up 4+ months of expenses and finally pulled trigger (no more Dave-ish!) on sending 15% of income to retirement savings. It’s hard to put extra money into mortgage before having a lot of money saved for a new vehicle though especially with low (2.4%) rate on mortgage.
To attest to the 3-6 months of savings. We replaced 2 car engines, washer, dryer, refrigerator, and a roof within a three year time frame without ever taking a loan or carrying a credit card balance over the month. This is on a one income household and three kids to care for.
Problems aren’t much of a problem when you can write a check and it goes away.
We are not saving for kids college funds as that is just not going to happen with our total income. But financial support is not the only way to help your kids get an education (traditional college is just one way) after high school. Those other ways we will be doing.
great work! it’s awesome to hear the plan working!
I finally broke down and set up a 529. the reason? I found out that private school expenses can be paid from a 529 plan ever since Trump’s “tax cut for the rich.”
keeping the kids out of public school is very important to me, so I’ll make it a priority to pay for that. I’m tempted to toss the actual “college” money into a regular investment account to avoid the penalty if entrepreneurship or a wedding take precedence.
I was going to set up a 529 but spawn number one’s tuition is covered while his room and board is not.
529s can’t be used for the room and board.
You can use the other account’s funds to pay for their room and board at your residence? Will it cover the internet bill for their remote instruction?
He’s going to boarding school. The 529 rules specifically exclude room and board.
I was making a ‘rona-forcing-online-only-instruction-based query.
When you said “the w-word,” that set off my pet peeve trigger. I have a visceral negative response to the idea of big-budget weddings. The first time I got married, I bought a pretty, white knee-length dress off the rack at Fashion Bug for $22. [Obligatory disclaimer: it was…sometime during the ’80s.] The wedding was in the small church where the 1st Mr. GT and I had met, and the reception was in said church’s fellowship hall. Tom T and I had a similarly low-budget wedding (complete with potluck meal after) and it was a wonderful time.
If you want to save for a child’s marriage, I think it should go toward their first home, not for a one-day party (assuming it’s not a multi-day Hindu service.) The point is to be married, not to stage a coronation.
What about the dowry, the dower, the tracts of land and the contributions to joint military ventures with the new in-laws?
Better to save for the military ventures AGAINST the new in-laws.
My wedding cost about $2,000. My mom paid half. We got the other half back in cash gifts.
I haven’t heard Fashion Bug mentioned anywhere in quite a spell. I was raised by my mom and my perpetually working day with 2 sisters in a town with one shopping strip mall. That was one of the stores from my childhood in the 70-80’s.
I somewhat agree with this. We paid $10k in 2013, and I thought that was a bit high. most went to being gouged by the venue and the photographer, but the venue was special to us and the photographer was worth it. Were we to do it again, we could probably cut the cost in half without blinking.
That said, I don’t really care how my kids spend the money I save for their “out of the nest” funds, as long as it’s not contrary to our morals. spend it on a wedding, start a business, take a vacation, donate it to charity, go to college, invest it… whatever.
We spent quite a bit more than that, but it was our first wedding and we’re both much older – a kick-ass party for friends and family was well worth it. I regret nothing.
At this point in life there will be no kids for us, so we’re free to blow it on whatever we see fit.
(we’re otherwise pretty frugal).
visceral negative response to the idea of big-budget weddings
That sounds like my wife. We got married at the courthouse, and then put on our uniforms and went to work. Of course we look at the old photos and say, “Geez, we looked like crap.” We actually did.
I always thought we should celebrate anniversaries with bigger and bigger parties. $3k/10years, $5k/20 years, etc. My wife is so anti-social that didn’t happen. We did talk about a big party for our 30th. It looks like the DNC has killed that idea though.
I’m sorry to hear that. More importantly; Congratulations.
Excellent advice, Trashy.
As a geezer I have to look slightly different. When I croak a lot of our monthly income disappears. I need to provide for Mrs Fourscore, in case I go first. Since we are the same age its a coin toss as to who outlives the other. The result is that we have investments, as long as the stock market holds up, that will take care of that for many years. Our wants are minimal, the toys that were necessary are still working but not used. I dress like an unemployed refugee from the Depression, wearing the clothes from when I actually worked and/or cared. For example, I’ve been wearing a dress shirt with my bib overalls, no one cares as long as my money is green.
We are both frugal, though Mrs Fourscore loves expensive pocketbooks and collects them, she probably has 80-90 or more, over a 100 pair of shoes, new in the box. She has cut way back the past few years at buying more, since she never wears them. Can’t complain ’cause my stuff can be excessive but again no recent purchases. Now the problem is who to give stuff away to, I’ve given away several items that fell out of the boat early and still have a lot of not being used things.
I paid off 2 of my grand children’s college loans, paid a bunch on the big spender’s college loan. Use credit cards monthly instead of cash but under control. 2 old trucks but I don’t really need a new one since I drive very little.
Important to have the house paid for at retirement, like UCS I paid off the first one in 8 years. This one I built with the excess cash when I was still working, invested the money from the first one when I sold it. Listen to Trashy, sounds like he is giving good free advice, worth every penny of what we’re paying for it.
“I dress like an unemployed refugee from the Depression”
Yes, I too was a teenager in the 1990’s.
i will never forgive anyone that had anything to do with JNCO jeans….
*Whistles Innocently while sliding his copy of Around the Fur and his Adidas pants out of view*
“Around the Fur” –one of the best!!!
I’ve been wearing a dress shirt with my bib overalls
I thought this is what happens to dress shirts naturally, after they catch some drippy condiment/grease.
“ I need to provide for Mrs Fourscore, in case I go first”
Since I plan to go first, and she and I have both seen how miserable so many people are being in poverty when they are elderly, my entire financial plan is focused on that one goal. The only “extravagant” spending we do is on furniture, and arguably and for a brief period now, on guns and ammo.
A long time ago, I was watching some show, and a guy (I have no idea who he was) comes on and says, “If you cannot afford the payments on a three year loan for that car you want, you can’t afford it. Buy something else.”
Haha, crazy, right?
I’m rebuilding my 96 Suburban. Reman engine and tranny is about $4500. I figure I’ll put another $5k in for parts/upgrades.
When it’s said and done I’ll have a vehicle that can go another 300k miles for about $10k.
It’s also nice that I’ve figured out all the mechanical issues on that machine. The worst of which is insufficient transmission cooling. Extra radiator on order and problem solved.
7 year cars loans are now a regular ‘normal’ thing. When I see brand new 75k+ vehicales that are just ‘pretty’ I cringe. It almost brings me physical pain to think about the waste of money in both interest, principal and insurance. WTF are those people thinking?
There are F250’s that now sticker price over $100k.
I can go buy a ridiculously reliable fuel efficient 3 row vehicle with low miles for 15k all day long. If i try hard I can get that under 12k.
Do you really have to buy the big ass v8 brand new monstroisty that you can barely fit through the starbucks drive through?
The diesel truck market is royally screwed up. I was buying duallies with diesels for under 36k ten years ago.
The same vehicle starts at 50k now.
The used diesel truck market is screwed up even worse.
There is some value to an engine that doesn’t have EGR valves and DEF tanks.
WA got rid of emission testing so that is not a problem any more.
I’m on the lookout for a diesel pickup at the moment, looking for something in the $15-17K range, and man there’s almost nothing out there other than a few that are 250K – 342K miles.
it’s the monthly payment mentality.
“that’s not a $100k truck, it’s a $1000/month truck”
A 7 year car loan sounds colossally stupid to me. You’re guaranteed to be underwater for a significant period of time, no? Cars can’t be holding their value that much better, can they?
My first question to people who complain that their broke is how often do you buy/lease a new car? Every three years you say? Are you rich? Because I think I see your problem.
A 3-year loan was my approach to buying cars. And i always bought used cars – about 2-3 years old.
I suffer from the old “too many assets, not enough cash” problem.
It’s part of owning a business that runs on capital assets. I relish the day I can liquidate.
Speaking of not properly managing finances. ..
https://www.foxbusiness.com/lifestyle/robert-de-niro-coronavirus-finances
I could get some good work done with a 100k or 50k monthly limit on an amex
I was thinking “I might power bottom Bob for a little while for a perpetual 100k monthly stipend”
DeNiro sounds like he can’t manage much of anything other than acting. Though this line from his manager:
“His accounts and business manager … says that the best case for Mr. De Niro, if everything starts to turn around this year,… he is going to be lucky if he makes $7.5 million this year,”
Tough times for everyone it appears
I guess that explains his short appearances in really crappy movies.
Good thing Trump cut his taxes!
Raging Bolshevik
It’s also nice that I’ve figured out all the mechanical issues on that machine. The worst of which is insufficient transmission cooling. Extra radiator on order and problem solved.
This is a highly underrated factor. If you (and/or your mechanic) know pretty much everything about your vehicle, why would you trade it away for a new can of worms?
My Honda ticked over 300k on the way back from Indiana. The transmission is starting to whine a little. One of these days, I’m going to yank it out and replace some bearings.
Do you really have to buy the big ass v8 brand new monstroisty that you can barely fit through the starbucks drive through?
Only if it’s making me money.
You forgot the “gets me laid” reason.
The jacked up, not a scratch in the bed-BRODOZER model or the brand new ESCALADE “daddy bought me North Korea” model?
That depends on where you live.
My car was in the shop once, and the rental was a Dodge Challenger. Went to the same Chick Fil A I always go to, and this time the cashier wrote her number on the receipt.
How about the local LEO? Did he write a number on the ticket as well? If not, rent that Challenger again.
And? You can’t start a “Dear Penthouse” story and not finish it.
She got off at 10, and I got off about 1145.
Lasted an hour and 45. Studdly.
from the morning thread…
if everyone wore the tire shoes there would be no more problematic knots and nooses on The Peoples’ feet.
The phrase “tie my shoes” has now become “lynch my feet”.
Many thanks to Festus.
GODS DAMN MOTHERFUCKERS!
Stop talking about taxes and government shit on an upgrade conference call. I’m going to bite through my tongue not responding.
I see love for Dave… but nothing about MMM?!?!?!
Mr. Money Mustache – Pete is the man. I’ll warn you though, he’s got a lot of hippy loving, pretentious, nanny state, asshole followers.
If you are trying to round yourself out in personal finance, Ramsey, Mr. Money Mustache, Clark Howard, and Bogleheads are all good resources.
there’s something about him that irks me, and i just cant put my finger on it.
Bit of a liberal bro, but he has some good takes.
But why?
https://www.thedrive.com/tech/34683/hyundai-is-making-a-real-manual-transmission-that-doesnt-use-a-clutch-pedal
My mother had a Honda 2-speed semi-automatic about 30 years ago. It was a glorified golf cart.
My mother had a Honda 2-speed semi-automatic about 30 years ago. It was a glorified golf cart.
Well, hope you have better success than Ford did with the fancy tricknology.
That is not a real manual transmission.
See: Volkswagen Super Beetle.
Hyundai claims the whole thing is rather simple in the official release linked here, which I doubt is true. The car still has a clutch, of course, because shifting gears without one would be a royal pain, but the process of disengaging and engaging it as you move the shifter is automated. The transmission can now tell when you’re about to grab another gear using what’s being described as an “intention sensor” in the shift lever, which in turn tells the transmission control unit to hydraulically manipulate the clutch for you.
Judging by the electric problems I’ve had on my Genesis, I’d stay far away from this.
Subaru has been touting their Continuously Variable Transmission – which is not even an option on most of their models. We bought the CrossTrek that still had a legit, manual transmission (having traded in our manual Outback).
“Taking the simplified thing and making it more complicated? Cha-Ching!”
— parts department manager
Is that really new though? I thought the Genesis coupe had that capability 10 years ago, it had an automatic but you could shift gears yourself if you wanted to with some levers on the steering column.
Flipping a selectable automatic into “manual” mode still usually shifts for you if you get close to red-line or stall. This doesn’t sound like it will shift for you, only engage the clutch for you when you want to shift. Though even then I’m not sure it’s new.
@Jorgensen4POTUS It is not enough to be passively not racist, we must be actively anti-racist.
a/ covered already?
b/ so predictable that the LP choice would trip into aligning with the social justice types sooner or later and not worth mentioning?
she’s getting cream one way, but a lot are standing up for her: can’t say if she’s netting or losing votes on this one (not that this matters)
She won’t move the needle in TN, so I’ll still vote for her: this one stupid thing doesn’t erase my desire to cast a significant protest vote
that’s strike two for her. strike 3 and she goes in the “no way in hell” pile with biden
1) playing pussyfoot with the environazis
2) this bullshit
It is not enough to control your own behavior, you must actively fuck around in other people’s lives.
— Supposedly Libertarian Candidate for Prez.
Not that I was seriously considering voting LP in November…
But this is immediate disqualification. I don’t care where the lady stands on other issues.
But this is immediate disqualification. I don’t care where the lady stands on other issues.
#metoo
I doubt the LP will get on the ballot in New Hampshire. Sure, I could write her in, but, immediate disqualification.
It’s not quite “bake that cake” but it’s getting close.
it can’t lead anywhere else
Same here.
Lie down with commies . . . .
Our mortgage payments are 9% of our gross income. Clearly we aren’t doing our part to stimulate the economy.
We have about 9 years left on the mortgage. We’d be making extra payments to bring that down, but we took pay cuts because of Kung Flu.
Did you mean just the P&I, or does that include taxes and insurance too? Because we moved into a foreclosure during the housing crash, I set our total non maintenance percentage at 20%. I have had a fixed payment for years. Any extra money goes to principal. As taxes and insurance increase, the extra principal will dry up and we will eventually hit our limit. Then it will be time to sell. We went into this “investment ” with general hope of being taxed out of it. We just wanted to enjoy it while we can.
just P&I. We pay property tax and insurance directly.
Adding those in would take it to about 12%.
That’s still pretty great.
Benefits of living in rural Iowa.
That’s probably about where we are.
Go figure. Most libertarians seem to be good at managing money. Maybe more of them should be in charge or something. I mean, if we can find a real one.
I had lenders offering 2 1/2 times the number that I needed to build my house way back when.
I got my loan with just my income. They wanted me to add my wife’s to get more money that I didn’t need. I have 20% down, take it, and get it approved already.
My fridge caught the COVID, I think, making intermittent struggling/grating noises. First happened a few months back, but whatever it is ground itself back to silence in short order. Started up again recently.
Compressor? Or is there maybe a fan in the upper portion behind the freezer?
Is replacing the compressor still a thing even, or should I start getting my backup fridge un-stunk and ready for deployment?
there are lots of cheap parts it could be (fans/motors): pull it out into the room, pull the panels, and wait for the noise; there’s a good chance you can find the noise and replace with an online part
one thing that makes noises come and go is condenser pressure: people move things around that restrict air-flow which leads to higher temps which leads to higher pressure, more compressor work, and more noise . . . so vacuum out that coil while you’re at it
IANA residential fridge guy, but I would think it odd for a hermetically-sealed system to kill a compressor; my parents had a Monitor fridge that ran for forty years with zero maintenance
Noted, thanks!
I guess I’ve been lucky. ROTC for college, moved to Spokane in time to buy a house before the market took off, drove rebuilt vehicles until I was 45, bailed on most relationships because I could see the train wreck coming (I have come to accept my terrible selection skills) and stuck it out long enough at work for the owner to bail and basically give me the business.
To answer a question from the now-dead morning links…..Akira, my go-to one volume Civil War history is Battle Cry of Freedom by James McPherson. It actually is about the Civil War era, which McPherson defines as beginning with the end of the Mexican War and ending with Appomattox. Great book.
Until the end were he pushes positive rights.
True, but overall I found that a minor blemish in a very good book.
I agree. It stood out to me because the book seemed quite neutral all the way through.
I grew up reading Bruce Catton books on the Civil War.
Sorry about Book Club, Trashy. Don’t you already have billing requirements? “Sorry, no time to read. Swamped by Such-n-Such case.”
li just ignore the stuff until I get voluntold to do it. sometimes I join meetings and just mute the audio so that I’m counted as attending if they take attendance.
The diversity stuff is a mile wide and an inch deep. they say things, they schedule meetings, but everybody knows that we’re too busy trying to keep this shit heap afloat to spend any real effort on it.
OT:
Son: “Do you think I’ll ever be married?”
Me: “Do you know much of my money I’d have if I had not gotten married?”
Son: “How much?”
Me: “All of it.”
/rim shot
I divorced at the bottom of a real estate cycle: probably me cost $50k
left that off my list o’ risks: choice of timing / liquidity / contracts
never again being bitched at about something stupid I said in 1987: easily worth $50k
But that really was a stupid thing to say.
Q: Why do divorces cost so much?
A: Because they are worth every penny.
We had a director of finance tell us that in a meeting once. He’s a VP now.
I was lucky enough to get divorced when the only assets I had were 2 kids, fortunately there was no dividing.
“You get the left half of one kid and the right half of the other”
/King Solomon
Not selling SUNW at its peak cost me about $100k. I still made money on the investment, but not that kind of money.
This is my HOGS GET SLAUGHTERED story.
We’ve “owned” (SLD) 5 domiciles during our marriage.
When we got out of Uni, we paid off our student debt first — that took about two years.
Then House 1. Conventional mortgage (in Canada, that means 20 or 25% down). Then one of our incomes (mine) went to nothing but the house debt payoff. Took 4.5 years.
House 2. 50% down, paid off in 4.5 years.
House (actually condo) 3. Paid cash (financed by sale of House 2 for double what we paid for it, ten years previously).
House 4. Paid cash minus $100K for anticipated “problems” that never arose. After one year, paid it off.
House 5. Paid cash, financed by House 4’s sale, had a significant chunk left over, which went into TFSAs and/or middling-risk retirement investments.
We’ve been both smart (retire debt fast) and lucky, in that we’ve always bought into rising real estate markets, and then when we moved to buy House 5, that market had significantly dropped, making for very good value propositions in real estate. That move wouldn’t have mattered if we hadn’t first had the mind-set that said “follow the best opportunity, rather than hanging around in a market that was trying to bankrupt you.” B.C.’s Lower Mainland is such a market. Moving back to Alberta was financially one of the smartest moves we ever made, although it was stressful in the short-term.
I’m hoping House 5 is the last one before we both go to our Great Rewards.
Yeah, but you’re in Canada.
I keed, I keed.
Actually, that some excellent financial discipline right there.
It helped a lot that we were both MBAs with training in finance, accounting, book-keeping, statistics, yadda yadda yadda. Our training was fairly quant-oriented, we had a common “language” for talking about our financial goals, and we’re both fairly analytical. Few things can scare the crap out of you faster than looking at an amortization schedule and realizing that if you don’t get off your ass and pay your big debts (house) off quickly, you’re gonna end up funding two or three extra houses for your banker.
At first, for a few years, I paid by my amortization schedule and paid the next month’s principal, but we couldn’t afford to keep doing that as repair bills kept mounting.
Ouchie. Money-pits can really screw up your finances.
Two of our houses turned out to be semi-money-pits (the below-grade basement in both cases, quelle surprise), but because we had them in rising markets, it made sense to “invest” in repairs/maintenance, so we did (and it did work out for us).
Then we moved to the Lower Mainland and discovered that the average house seller there had exactly zero motivation to do maintenance/repairs/renos, because the market was blue-white-actinic hot and people would buy anything with no conditions, not even a cursory house inspection. That was a shock to our system, but it ended up working in our favour five years down the road.
And now we’re in Edmonton.
I did the math and I am saving over $200,000 in 23 years of interest payments by being more agressive.
The house is only worth $82,000.
Yep. ”The magic of compound interest” is only magic if you’re owed money, not if you owe it.
Hmmmm. Actually, I take that back. In the latter case, it’s still magic. Black magic.
I hear you, UCS. You can think of the 200K as your investment money. “A penny saved…”
Stupid expense but tempted to send this to my best friend for his birthday.
https://www.cameo.com/jonlovitz
These sort of things slay me. Sometimes the internet putting
everyone together is worth it. It’s also a hoot seeing what
various people charge.
Do it if you can afford it. This is the sort of thing that gets remembered.
I’m tempted to pay cardale Jones to make a video for sloopy.
or urban meyer
Our house is paid off. The farm we mortgaged to try the pot / hemp business is up for sale. We may have an offer this weekend. Once it’s liquidated we’ll be debt free. We’re hitting out financial goals.
I like Dave’s plans though I do have some quibbles that others have mentioned. I have credit card, but that’s because it’s paid off in full every month, and the rewards are well worth it.
I didn’t follow Dave’s plan though. Mostly the wife and I were dual income, but from the start we made sure that 1 salary was enough to cover all expenses and most of the budget. So the second was always extra investment/pay down debt/fun money. Originally that was so that when we had kids we’d be able to go to 1 income. That didn’t work out, but that puts retirement in sight in ten years.
Though honestly I don’t know if I want to retire.
howdy !
How’s it going Don?
I retired at 55, smartest thing I ever did. I had a couple jobs for friends when they needed someone for a day or a week but I wasn’t in need, just a couple guys I was doing favors for and they repaid the favors. Got away from those jobs as soon as I could. I started thinking retirement at about 45. I fished a lot, traveled a bit, worked hard doing the things I wanted to do. My older brother worked into his late 70’s, had no friends, no hobbies, we fished Canada every summer and hunted for a week in the fall but that was about all he had time for.
I think for retirement i want to do something like teaching at a community college or selling motorcycles. Something part time. I don’t know, I tried to take a 3 month hiatus one time I was back to work in 4.5 weeks. I’ve never really had an extended period of not working. I may go back to consulting and only take short term, remote, part time contracts or something. But I gather your point. And the good part is, I have an option.
If you are enjoying what you’re doing it isn’t work.
That’s the truth.
Whatever else all the Pooh Flu Pandemic has done, working from home has made my job much less work. And we’ve moved to permanent remote even when this health craze blows over.
I’m also chewing over another attempt at entrepreneurship 45 is a bit late, but this idea is lower risk, lower reward and more of a lifestyle business that I can start as a side hustle. I’ll find a way to keep busy.
I’ll touch on this more deeply In a later article, but to me, retirement isn’t an age, it’s an account balance. retirement is when I don’t need the paycheck anymore. I may decide to keep working. I may decide to find a new job. I may do something riskier (like start a business). I’m hoping to “retire” in my 40s. I’ll probably work into my mid-to-late 50s at a bare minimum, but probably in a low-stress, clock-in clock-out job.
That makes sense, Trashy. (And great article, bee tee dubs). We’re almost there. Once that farm is sold, we’re really close to that point. The goal was originally by 55, but we had a windfall I wrote an article about that sped up our timeline.
I like that definition of retirement.
“retirement is when I don’t need the paycheck anymore.”
Exactly.
Retirement is when Alzheimer’s keeps me from working.
How will you be able to tell?
Someone else will be making my decisions at that point.
Howdy, haven’t seen you in a while.
Congratulations on the farm sale. Hopefully it goes well.
We have no debt except the house, but we are still in step 2, as we have decided to treat part of the debt as step 2 debt until we get rid of PMI. With the business failure a few years back and the layoff/move last year, we didn’t have as much equity as we would have liked (I have owned 5 houses over the years, and this is the first I have ever been under 20% on). We are refi-ing next week, so it is going to get a bit easier (I am literally getting paid to refinance. Not only is the rate significantly lower, the credits towards closing are more than closing costs).
I have been ratcheting up the retirement, so we are already working on step 4. But once we finish 2, I am going to switch our extra house payments to building up the full emergency fund. This is going to drive my wife crazy, the idea of having 15-20k sitting there doing nothing is gonna drive her nuts. I expect a fight on this early next year. If I disappear off here, you know why.
Landsharks.
In my neighborhood, landgators are more likely.
the Clinton Foundation was running low on money?
Speaking of Dave Ramsey:Once Again, Dave Ramsey Is Wrong About Financing A Car
This…is correct. I get why Dave has to poo-poo 0% loans, but there are exceptions to everything.
SF’d the link?
I added an extra letter to the URL because why not:
https://jalopnik.com/once-again-dave-ramsey-is-wrong-about-financing-a-car-1844328020
His math example is a bit of a straw man, as Ramsey would never recommend taking out a 5% loan on a used car. If you don’t have the 18k on hand, you don’t buy it either. And if you have the 18k (above and beyond your emergency fund), then getting it to 24k isn’t really an issue. You may or may not be sitting on $1 million in assets, but you are probably in pretty good shape.
So what do you do if the very thought of haggling gets your ire up?
Asking for my closest personal friend and worst enemy.
Don’t plan any vacations in China or the Middle East.
Do what I did on my last car, get Costco to do it for you.
I am sure I could have got a better deal, but not that much better, so it was worth it to me. I knew from googling around in advance what a good price would be, and it came in just inside my “I am going to accept it” range.
It is over seventy miles to the nearest costco.
I dont think that matters (except you have no reason to have a costco card). I did it all online. Then had to show up to the dealer to get the price…that is the key part of it and why the dealers agree to do it. They know if you get to that point, as long as the offer is good, you aren’t going to go elsewhere. You can, but it is a painful process.
Go online and ask for the best internet price from 5 dealers in the area and outside of it. Then take your lowest bid to the closest or best dealer for you and have them meet or beat the price. I would play hardball after that and get them to beat each other down and race to the bottom, but to each his own.
Also, in terms of acquiring transportation, a lot of us don’t generally get to choose when we have to walk into a dealership and find something.
First car ($15k) was bought because they shut down the bus route I’d been taking to work, and walking three miles in a snow bank in the dark was getting untenable.
Second car ($25k) was bought because someone parked a Buick in the first car’s wheel well, and there was no option that would get me to work that wasn’t just even more expensive than taking on a car payment.
The worst part of the article was this:
Furthermore, the fact that a professional financial advisor is telling people to walk onto a car lot and haggle in person is not only irresponsible during this pandemic it is also incredibly foolish when it comes to knowing whether or not you are actually getting a good price.
Agreed, I decided against railing about that.
How to get screwed and like it?
Not covered in that article, but that I have seen elsewhere, the ability to get a cash discount doesn’t really exist like it did 20 years ago. Now, at most dealerships, if you announce too early in the process you are paying for cash, there are many discounts you can’t get. The key now, from what I understand, is to do all the negotiating as if you were going to get a loan, negotiate the best possible price, get it agreed to, and then surprise them with, “Okay, here is a cashier’s check.”
Yes, there are always exceptions, but you can’t go around spending all your times discussing the exceptions, the point is they rarely apply. As much as he hates bankruptcy, I have actually heard him recommend it on his show. He does make exceptions and I bet many more of them in personal, one-on-one counseling.
I’m surprised Dave is arguing the numbers there. No loans is about principles as far as I can tell.
The borrower is servant to the lender.
In the FPU videos there is a guy who dug himself out of tons of debt and comes back on to say “Nobody owns me now. Nobody.” Regardless of how “cheap” the loan is you still owe someone something. That “can” come back to bite you. If you own it outright, it’s yours to do with as you please.
That is the deal, Dave isn’t arguing the numbers, the guy who disagrees with him is.
It is just like the lowest to highest credit card thing. Obviously, paying off highest rate to lowest rate is the cheapest method, but lowest amount to highest amount creates the psychological felling of winning early on that enables people to continue on.
“but lowest amount to highest amount creates the psychological felling of winning early on that enables people to continue on”
This is v. important. Also, Ramsey has this idea of the “snowball” effect. If you’re paying $100 on one debt & $500 on the other, as soon as you pay off the $100 one, you’re now paying $600 off the second one.
That works in either order, but that is part of the winning early approach, you see the snowball build up at each step of the way. Plus, if your high interest debt is also your largest debt, you can probably find a way to get it to a lower rate until you get to it. Its not like “0% for 18 months!” credit card offers aren’t showing up every week. I used that approach in the year following my business crashing. It was worth the 3% one-time fee to let a big chunk of debt sit interest free for 18 months while I worked on everything else. I then was able to pay it entirely off during month 18.
yeah, that’s a hard one for a numbers guy like me to accept
but I don’t have the mindset and must defer to Dave’s understanding of “most folks”
gotta give him this: if a guy didn’t dig his hole with a numbers mentality, he probably ain’t gonna fill it in that way, either
the other brute-force notion Dave has is earning/spending: some folks need to get serious about making more; some folks need to get serious about living within their means
I have heard him tell people they need to find a way to make more. Its just that once you get to a certain level (say, close to average American household of $60k), the spending is going to be the bigger problem. If your HH income is 15k, he is going to tell you to find a way to make more. If you are already bringing in $75k, that isn’t your biggest problem.
own it outright
yeah: it’s really the risk side of the profile; future income is never known; I think about how many people who were week-to-week in the past five years and then got 0% loans who suddenly don’t have jobs at all
Ding ding.
0% interest loans still have payments, and cash flow interruption is still a risk.
It’’s still a borrow to invest arbitrage play.
I disagree. Even at 0% interest you are spending tomorrow’s income on a today luxury consumer good. A wealthy person who could by the car for cash on hand and is investing the cash instead to pay the car off over time might be ok buying the 0% car, but Dave is not talking to that person. That person already has their house in order and the person who is not in that position is going to hear “It is ok to buy a 0% loan car” and end up buying more car than their current finances allow. Mr. Akshually in the article is creating a straw man here.
You’re assuming transportation to be a luxury good.
If you need it to be able to keep earning tomorrow’s income, it’s not.
Any car costing more than … [pulls number out of ass] … $5k is a luxury good, in part.
A car costing $5k is going to have a maintenence cost that makes it a questionable purchase.
It isn’t even the maintenance cost so much as the maintenance time and maintenance worry, especially for people who can’t do routine maintenance themselves. Sometimes the peace of mind is worth the extra money.
This sort of speaks to the point Don made above regarding 30 yr vs. 15 yr mortgages. A 0% rate is inviting someone to start justifying more car than they need. But, that wasn’t the point Dave made in his response.
Likewise, the author shitting on Dave screwed up by comparing a used car loan to a 0% loan. The appropriate response might be someone with $20k cash looking to buy a used car might be better off buying a $24k car with a 0% loan. The depreciation on it is not 60%, and with a full factory warranty (depending on what you buy) is not necessarily a bad idea.
I mentioned upthread refi-ing my home. I could have got a 20 year at a rate that was a few bucks below what we have been paying anyway. I went with a 30-year is a higher rate, because it gives us flexibility. We are going to continue to pay that amount for a while (and it will mean about $200 more per month going on principal), but I want the flexibility to switch off and use that extra cash for building up the emergency fund for a bit, then make sure college is funded (we have a good start on that anyway, but it needs a bit more), then go back to paying on the house. Or whatever, we may split that money 3 ways, or we just continue to pay it on the house.
The point is, we are going to take 30 years to pay off the house, but a 15 or 20 year severely restricts the flexibility.
There was no interest rate change from twenty to thirty for me. It was an easy decision.
I like the flexibility of buying with a 15 year payment in mind (and making it or more) but still going 30 year because of the flexibility as well.
Of course it does require the discipline
In our case the difference between 15 and 30 would have been only about $400 a month (It was a small mortgage) but that’s still 400 a month we could if an emergency arose eliminate without having to negotiate, beg, change our lifestyle, or anything.
we ARENT going to take 30 years.
DONALD TURMP IS A GOVERNMENT CONSPIRACY
DON’T BELIEVE THE LIES
WAKE UP SHEEPLE
Good article Trashy.
Leap, is this the article you were looking for? https://en.wikipedia.org/wiki/Information_cascades
I’m learneding!
Trashy,
Thanks for the callout to my article. I never hand a handle on exactly what Dave Ramsey’s steps were, so this was informative. Not the approach I took (or would choose to take), but I can see it as useful for other people (like maybe certain Millennial family members). So, thanks for the explanation.
One point of clarificatio: my handle is “Annoyed” Nomad, not “Annoying”. You make me sound like I’m the passenger in the car who keeps asking if we’re there yet.
my Apologies! you are anything but annoying.
Great article Trsh. I agree with a lot of Dave Ramsey, but am not a fan of an emergency saving fund and staying away from 0% loans.
I can’t think of a reason to prioritize an emergency savings fund over contributing to a Roth IRA unless you make enough to not be able contribute. You can always use your Roth contribution as your EF if needed. The time spent building the EF instead of contributing to Roth is tax-advantaged space gone that will never come again. I can see a place for EFs after fully maxing all tax-advantaged space but am still not sold that money isn’t better off someplace else since an emergency can easily be funded out of existing funds.
Money is fungible. It’s a psychological trick that saving $500/month for 5 years to pay cash for a car is any different than paying $500/month for 5 years at 0% interest to purchase a car. If you’re taking that $500/month to pay cash away from funding tax-advantaged accounts, then you’re negatively impacting your retirement to save for the car. Get that money in early. You can always reduce contributions by the same amount for the 0% car loan payment, if needed. If you are maximizing all tax-advantaged space, I guess pay cash but it’s all academic since the price of a new car should be a drop in the bucket of your net worth after a while. Of course, loans with a interest rate with 0% changes the math.
*Of course, loans with a interest rate other than 0% changes the math.
staying away from 0% loans
I’ve done two of those back in day (2000 & 2002) on two Mitsubishi’s. The trick then is to get an acceptable price. The sales fucks kept going at the monthly payment. It was pissing me off. How about this payment? Let’s see, XXX dollars times 36 = nope, try again. We paid off both in just over two years.
this. I did 0% on the engagement ring for my wife, but her sister was the one who sold it to us, so we got a decent price on the ring plus the 0% loan. I don’t know that I’d do it again, given the opportunity. I hate having payments.
For the financially non-savvy it’s better to stay away from 0% percent loans completely because it’s easy to take the next step to “No interest for 18-months” loans which appear to be 0% but in reality pile up interest if you don’t quite pay it off completely in 18 months.
“No interest for 18 months” loans are also usually front-loaded; the effective interest paid, even if it’s paid off within that 18 month window, is the difference between the cash price for the item and the total amount paid over the 18 month period by the purchaser. A regionally-famous furniture store started this scheme back in the early 1980s and has been milking it ever since. The recent “innovation” is that they sell the contract to a finance company and take the cash price directly from the finance company, so they’re out and the FiCo takes the potential non-payment risk on. Meanwhile the purchaser believes he/she got a deal.
You can always use your Roth contribution as your EF if needed.
This. If you are baby stepping, once you get to step 3 get an emergency fund in a regular savings account, then start moving it over each year into a Roth.
I can’t think of a reason to prioritize an emergency savings fund over contributing to a Roth IRA unless you make enough to not be able contribute
a few months back, my Roth was down 25% and the first whispers of a layoff were starting to circulate at my company. if I had my 6 month e-fund in the Roth and had been laid off, it would have turned into a 4.5 month e-fund right when I needed it. In fact, I’d be starting in on my last month’s reserves right now.
In a future article, I’ll talk about my layered approach to building reserves, but the relevant part is that I plan to keep the first 6 months of e-fund in cash and the next X months in a Roth. I think that 6 months reserve is low, and the Roth plays into alleviating that concern.
if I had my 6 month e-fund in the Roth and had been laid off, it would have turned into a 4.5 month e-fund right when I needed it. In fact, I’d be starting in on my last month’s reserves right now.
I’m following, but a person should have multiples of their e-fund in their Roth over time. There’s a chance the market could drop through the floor just as you begin contributing and need the money. I’m not sure that chance outweighs the advantage of filling your Roth space.
I think there was a much stronger argument for dedicated EF when interest rates on savings accounts were paying 4-8%. Now inflation is just whittling away whatever is socked away in a savings account.
And, of course, you could put the EF in the Roth in something safer than the stock market, like a bond fund or something.
I actually like the idea of using a Roth as the Big Emergency Fund. Any gains from the safer investment can be invested in more risky investments. So the EF part is always safe, but any tax-free growth builds up even faster.
Used mine to fund a bar in my basement. Does that make me a bad person?
No, no it doesnt.
The problem with this plan is that if you are maxing out your IRA contribution, there is no room to contribute to a Roth IRA.
On the other hand, if you are maxing out both 401k and IRA limits, you can probably afford to take the minor hit and have your EF in cash.
This article is wonderful and yet, crushingly depressing. I’m, quite literally, worth more dead than alive right now.
<a href="https://youtu.be/aZAxW4fpBAQ" title="
” target=”_blank” >
Well… that didn’t quite work out.
This? https://m.youtube.com/watch?v=aZAxW4fpBAQ
That’s the one. Thanks.
I’m very fortunate that Mr. Cannoli and I both had scholarships so we got out of college debt-free. I’m also fortunate that he’s really not a spender. I sort of am, but I’m also an obsessive planner, so at least I don’t spend money before we’ve saved up for it. We’ve been saving 20% for retirement since day one, and our only debt is our mortgage. We probably won’t pay our house off early, though, and we’ve also occasionally done 0% loans for purchases where we already had the cash saved so we could keep earning interest.
How I bought Mrs. Suthenboy’s car:
1. Put her off until we saved the money to buy it outright.
2. Went to dealer, chose car, financed it, paid off finance with Discover card
3. Went home paid off Discover card with money saved up to buy card.
4. Cashed in reward points from Discover.
5. Used points to pay off two months worth of Discover purchases which we use to pay utilities, groceries, gasoline etc
New car, bank balance slightly up.
The credit card rewards can be nice, I often do something similar when I have a large purchase to make; when I bought my mountain bike I opened a new card, got a couple hundred dollar new card bonus from the purchase, then paid it off at the end of the month
*thumbs up*
Always pay your cards off at the end of the month. Never let a balance carry over.
TARDIS is a very grumpy boy when he effs up and has to pay interest on
a credit cardanything but a mortgage. It’s happened maybe 4 times in 30 years.I usually overpay my balance to the next hundred dollars. Lately. Citibank has been annoying me by sending me refund checks instead of letting the positive balance ride.
refund checks
What the hell is that!? I have autopay on an account based on my budget for it and tune it when the bill arrives. Went a couple of month spending nothing lately (#CoVid), so I ran up a balance. Then: stupid check thingy.
I put everything on the credit card, zero it out every payday, and probably get around a thousand a year in cash rewards.
That’s awesome. I thought about doing that myself. I just need to check the reward limits.
Nevada rolling back freedoms…encouraging outside dining.
https://www.breitbart.com/politics/2020/07/10/nevada-governor-closes-bars-quell-spread-chinese-coronavirus/
Todays temp?
https://duckduckgo.com/?q=89119+weather&t=brave&ia=weather
SCIENCE!
It’s just a broken record at this point, but I have no idea how these “emergency” powers are still allowed to be used 4 months into this – I also have no idea why they can just destroy entire industries like this.
Yeah, I don’t get how a governor can just unilaterally declare an emergency, with no objective basis, and assume dictatorial powers under that emergency while never declaring and end to the emergency, or even setting out a reasonable basis for the emergency ending. Just keep the emergency in place indefinitely, because FYTW.
Ha! You are welcome to enjoy outdoor dining right now in New Jersey – in the middle of Tropical Storm Fay.
What I did with Mrs. Suthenboy’s inheritance from her parents:
1. No, you cant spend it. Buy more junk and pile it up on top of the junk we already have? I think not.
2. You are going to outlive me by a long shot. When I am gone you are going to need it.
3. 10 year annuity at 7% interest (The reason people advise against these is because there is a penalty for taking the money out early and almost everyone takes it out early. We didnt)
4. It matures this October and our guaranteed return is 44% more than we put in. Not bad.
5. Until we see who wins in November we are leaving it in for a bit. If Trump wins we will let it ride until the stock market shoots back up. If he loses we will cash it in and buy a preppers fortress in the wilderness.
If he loses we will cash it in and buy a preppers fortress in the wilderness.
I can make you a deal on one in rural VA. We’re getting out.
Won’t be much of a fortress if you can’t have guns and ammo.
Here’s a Goldman Sachs “financial expert.” Spend 6 months destroying your revenue stream, then illegally borrow $10 Billion with no way of ever paying it back – in order to avoid cutting expense.
My guiding principles (from 1998): Quit Today; Pay Cash; Don’t Retire; Die Broke.