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Re: Where do I learn how much one SHOULD spend on a home?

Why do you want to buy a house? I own a house and it has turned out to be a great thing for me personally and for my family. But not everyone should have a house and this is all the more true for someone young and single. Might be a great idea or might be a bad idea or somewhere in between. And that...
by Rodc
Sat Mar 21, 2015 8:42 am
 
Forum: Personal Finance (Not Investing)
Topic: Where do I learn how much one SHOULD spend on a home?
Replies: 64
Views: 4971

Re: What Age Did You First Ponder Financial Independence?

To be honest thinking in terms of "financial independence" came extremely late in strict terms. I understood the basic idea of having a source of income without working to fund retirement very early as I had elderly relatives that were retired. The two are of course related in that one all...
by Rodc
Sat Mar 21, 2015 8:36 am
 
Forum: Personal Finance (Not Investing)
Topic: What Age Did You First Ponder Financial Independence?
Replies: 74
Views: 6536

Re: What Age Did You First Ponder Financial Independence?

I remember being about 3-5 years old - just learning what a bank account was - and asking my parents "Couldn't you just save and save and live off the interest?" It seemed so obvious .. Yeah, I think I was two and a half, but was thinking more in terms of mutual funds. Of course it was an...
by Rodc
Sat Mar 21, 2015 8:34 am
 
Forum: Personal Finance (Not Investing)
Topic: What Age Did You First Ponder Financial Independence?
Replies: 74
Views: 6536

Re: Children's Swingset

our neighbors have a big swinset and 4 kids. Rarely see them playing with it. Despites DW pleas that we need a play set, we did not get one, rather we go to the "muddy pond" to look for golf balls, go to the nearby school and use the playground there, joined the Childrens' Museum and loca...
by Rodc
Sat Mar 21, 2015 8:31 am
 
Forum: Personal Consumer Issues
Topic: Children's Swingset
Replies: 43
Views: 2533

Re: Children's Swingset

Might get used for a few years. Ours got a lot of use, until maybe age 10? Don't remember exactly. Got our play structure at Costco for a whole lot less than the name brand ones. Now to be sure it did not last as long either. But we had twins and stopped so we knew we had a limited need. If you thin...
by Rodc
Sat Mar 21, 2015 8:26 am
 
Forum: Personal Consumer Issues
Topic: Children's Swingset
Replies: 43
Views: 2533

Re: Poll: Do you consider mortgage payments an investment?

My objective in this poll was to see how many people decide to buy based on perceived financial gain and what their decision points were. You would have achieved that goal if you had asked that question, but I suspect now you won't. :) I did get a gain (it is now 20 some years later so easy to know...
by Rodc
Wed Mar 11, 2015 12:15 pm
 
Forum: Personal Finance (Not Investing)
Topic: Poll: Do you consider mortgage payments an investment?
Replies: 58
Views: 3662

Re: Pension vs. Lump

If you decide it is a "coin flip" I would go with the Lump Sum. That way you have it, you control it, no corporate bankruptcy risk. If the paying company goes bankrupt the federal PBGC insurance will make the payments. That was a factor when I decided to take the company pension instead o...
by Rodc
Wed Mar 11, 2015 12:10 pm
 
Forum: Personal Finance (Not Investing)
Topic: Pension vs. Lump
Replies: 58
Views: 3084

Re: Poll: Do you consider mortgage payments an investment?

Yes, my principal payment is an investment (technically the home is an investment and payment of principal on the mortgage increases my "equity" = home value - amount owned, more or less meaning the amount I actually own vs the bank increases). Now it might or might not be a good investmen...
by Rodc
Tue Mar 10, 2015 1:09 pm
 
Forum: Personal Finance (Not Investing)
Topic: Poll: Do you consider mortgage payments an investment?
Replies: 58
Views: 3662

Re: College readiness

FWIW: With this sort of kid and a town where most kids go to college there is little if anything specific you need to do.

Maybe make sure he knows how to do laundry. And perhaps how to cook if after a year or two he will likely move off campus.
by Rodc
Tue Mar 10, 2015 12:56 pm
 
Forum: Personal Consumer Issues
Topic: College readiness
Replies: 27
Views: 1757

Re: Bernstein: 2% investment returns over next 20 years

If he is talking about 20-year bonds you bought today then he is more likely correct than if he is talking about 10-year bonds you are going to buy in 10 years. It is very unlikely the bond market in 10 years will be a copy of the bond market today. Similarly for stocks, but with much higher uncerta...
by Rodc
Tue Mar 10, 2015 12:03 pm
 
Forum: Investing - Theory, News & General
Topic: Bernstein: 2% investment returns over next 20 years
Replies: 216
Views: 22773

Re: College readiness

Did my parents know that I was sawing transistors in half, partly to see what was inside, but partly for the sheer joy of destruction? Did they know that I deliberately exceeded the power rating of resistors to watch them smoke and, if it was a good day, crack open from the thermal shock? If they h...
by Rodc
Tue Mar 10, 2015 11:50 am
 
Forum: Personal Consumer Issues
Topic: College readiness
Replies: 27
Views: 1757

Re: Growing out long hair and growing a beard

For those of you with long hair, what products do you use to take care of it and style it? I had extremely long hair for many years. Shampoo, comb it out. Nothing else was needed. If out in the wind or otherwise need to keep it under control, pull it back into a pony tail. Use cloth covered elastic...
by Rodc
Sun Mar 08, 2015 11:35 am
 
Forum: Personal Consumer Issues
Topic: Growing out long hair and growing a beard
Replies: 24
Views: 2726

Re: Does My Daughter Need A Prenup?

This is a tangent so not sure if people are interested. Also I only skimmed so might be in there somewhere. I noticed one post, likely there are others with the idea of an inheritance is properly the property of the person who received it. That may be the law, but one thing I wonder about is how tha...
by Rodc
Fri Mar 06, 2015 4:27 pm
 
Forum: Personal Finance (Not Investing)
Topic: Does My Daughter Need A Prenup?
Replies: 175
Views: 5799

Re: Do you consider mortgage payments as savings?

If I take money from my savings account and put it on my mortgage, it is a re-allocation of savings. If, however, I take extra out of my paycheck and, instead of spending it, I put it on my mortgage, that is savings
.

Agreed. I have not been careful in some of my posts about this point.
by Rodc
Wed Mar 04, 2015 6:36 pm
 
Forum: Personal Finance (Not Investing)
Topic: Do you consider mortgage payments as savings?
Replies: 410
Views: 20079

Re: Do you consider mortgage payments as savings?

To anyone who stated making mortgage principal payment increases his net worth, Q: does making credit card balance payment also increase your net worth? If you say no, please explain why making a debt payment (debit liability, credit cash) increases net worth in one case but doesn't in another case...
by Rodc
Wed Mar 04, 2015 1:49 pm
 
Forum: Personal Finance (Not Investing)
Topic: Do you consider mortgage payments as savings?
Replies: 410
Views: 20079

Re: Backpedaling: Rising Equity Allocation During Retiremen

Good for Dr. Pfau. The previous paper, by Kitces and Pfau, was properly stated. In my opinion, they made it clear that this was a fairly weak effect, based on various carefully assumptions. One of the big ones is only mentioned in an aside: "the clear caveat and concern of this approach is tha...
by Rodc
Wed Mar 04, 2015 1:02 pm
 
Forum: Investing - Theory, News & General
Topic: Backpedaling: Rising Equity Allocation During Retirement
Replies: 38
Views: 3672

Re: Any ever do a small addition on their house?

I think it would be money well spent to hire an architect to come up with some ideas. Or even just a good experienced design/build general contractor. I hired an architect in this context and frankly just working with the experience builder generated better ideas and was free. Your mileage may vary.
by Rodc
Wed Mar 04, 2015 12:57 pm
 
Forum: Personal Consumer Issues
Topic: Any ever do a small addition on their house?
Replies: 24
Views: 1893

Re: Do you consider mortgage payments as savings?

I think the most interesting question here is why are we on a 5th page for this thread? Something must have clearly touched a nerve on a lot of people. A house is nothing more than a thing. It's an item that you've purchased. You can either pay cash for it or you can borrow to purchase it. Why is i...
by Rodc
Wed Mar 04, 2015 10:22 am
 
Forum: Personal Finance (Not Investing)
Topic: Do you consider mortgage payments as savings?
Replies: 410
Views: 20079

Re: Any ever do a small addition on their house?

Dave, The boys can continue to share a room, can be done for sure, was for generations. But having two full adult sized males in one room will be pretty crowded. And at some point, while not a need, they will likely want separate bedrooms. I have twin boys who shared a room. We have a third bedroom ...
by Rodc
Wed Mar 04, 2015 10:13 am
 
Forum: Personal Consumer Issues
Topic: Any ever do a small addition on their house?
Replies: 24
Views: 1893

Re: Not Interested in Ever Owning Real Estate

owning has worked very well for me. It helps a lot that I think of home maintenance as more a hobby that a chore (most of the time). I like mowing the yard, a nice little walk. House prices here have gone way up in the 20 years I have been here. But home ownership is not for everyone. It ties you do...
by Rodc
Tue Mar 03, 2015 8:07 pm
 
Forum: Personal Finance (Not Investing)
Topic: Not Interested in Ever Owning Real Estate
Replies: 35
Views: 3385

Re: Any ever do a small addition on their house?

I have done one large and one small. House was a small ranch, smaller than yours, 2 bedrooms. We removed the attic and put on a full second floor with 3 bedrooms and bathrooms, and moved around walls on the first floor to open it up to make a nice living room, kitchen, tv room and office. New master...
by Rodc
Tue Mar 03, 2015 7:56 pm
 
Forum: Personal Consumer Issues
Topic: Any ever do a small addition on their house?
Replies: 24
Views: 1893

Re: Taylor Larimore Honored

Very cool.

You are living a life well lived.
by Rodc
Tue Mar 03, 2015 5:06 pm
 
Forum: Investing - Theory, News & General
Topic: Taylor Larimore Honored
Replies: 59
Views: 4874

Re: Do you consider mortgage payments as savings?

EXTRA payments on the Mortgage (I agree with grabiner on this) Two twins buy identically priced houses. Twin A takes a 10 year mortgage and pays it off at the scheduled 10 year mark. Twin B takes a 30 year mortgage and pays it off early at the 10 years mark. Twin B is saved more because his payment...
by Rodc
Tue Mar 03, 2015 2:35 pm
 
Forum: Personal Finance (Not Investing)
Topic: Do you consider mortgage payments as savings?
Replies: 410
Views: 20079

Re: Do you consider mortgage payments as savings?

If you asked 100 homeowners outside of BH whether their mortgage payment is an expense, my guess is that most would say yes, including both principal and interest. You're right that most homeowners would say their entire mortgage payment is an expense. But popularity of an idea doesn't make it righ...
by Rodc
Mon Mar 02, 2015 8:29 pm
 
Forum: Personal Finance (Not Investing)
Topic: Do you consider mortgage payments as savings?
Replies: 410
Views: 20079

Re: Do you consider mortgage payments as savings?

This raises the corollary question of why hold bonds with an expected return of 2% while paying a mortgage with a guaranteed rate of 3.25% (by paying it down)? A good question. To answer one has to factor in things like liquidity, taxes, loss of tax advantaged space, and matching funding. Not all o...
by Rodc
Mon Mar 02, 2015 9:13 am
 
Forum: Personal Finance (Not Investing)
Topic: Do you consider mortgage payments as savings?
Replies: 410
Views: 20079

Re: Do you consider mortgage payments as savings?

People that do not count the house will buy less house. Is that like setting your alarm clock off by 15 minutes to "trick" yourself into getting up on time vs just being accurate and getting up on time, because, well it is when you need to get up? Personally I have never been able to fool...
by Rodc
Sun Mar 01, 2015 9:26 pm
 
Forum: Personal Finance (Not Investing)
Topic: Do you consider mortgage payments as savings?
Replies: 410
Views: 20079

Re: Do you consider mortgage payments as savings?

I did propose a definition in an earlier post that I will re-state here. Put in words, I consider savings to be ... Right. You proposed. Did you get agreement from the group? My point is not that no one made a proposal. My point is that without agreement on a definition no meaningful progress will ...
by Rodc
Sun Mar 01, 2015 7:29 pm
 
Forum: Personal Finance (Not Investing)
Topic: Do you consider mortgage payments as savings?
Replies: 410
Views: 20079

Re: Do you consider mortgage payments as savings?

I think I've figured out what's going on here. People are assuming that their house is not an asset, and that their mortgage is not a liability. They're pretending they don't exist. But it's simply not factually accurate. If you have a $200,000 mortgage, you owe the bank $200,000. If you have a $25...
by Rodc
Sun Mar 01, 2015 7:28 pm
 
Forum: Personal Finance (Not Investing)
Topic: Do you consider mortgage payments as savings?
Replies: 410
Views: 20079

Re: Do you consider mortgage payments as savings?

I did propose a definition in an earlier post that I will re-state here. Put in words, I consider savings to be ... Right. You proposed. Did you get agreement from the group? My point is not that no one made a proposal. My point is that without agreement on a definition no meaningful progress will ...
by Rodc
Sun Mar 01, 2015 7:23 pm
 
Forum: Personal Finance (Not Investing)
Topic: Do you consider mortgage payments as savings?
Replies: 410
Views: 20079

Re: Do you consider mortgage payments as savings?

I think you all are not debating whether or not mortgage (principle) counts as savings. You are sort of dancing around the question of what the definition of "savings" should be. If you actually came up with a definition the answer to the question would be clear. Has anyone wanted to expl...
by Rodc
Sun Mar 01, 2015 5:18 pm
 
Forum: Personal Finance (Not Investing)
Topic: Do you consider mortgage payments as savings?
Replies: 410
Views: 20079

Re: Do you consider mortgage payments as savings?

I think you all are not debating whether or not mortgage (principle) counts as savings. You are sort of dancing around the question of what the definition of "savings" should be. If you actually came up with a definition the answer to the question would be clear. But it really does not mat...
by Rodc
Sun Mar 01, 2015 4:52 pm
 
Forum: Personal Finance (Not Investing)
Topic: Do you consider mortgage payments as savings?
Replies: 410
Views: 20079

Re: Debt Snowball with Variable Rates

I'd probably go after them in this order. I would re-evaluate if rates change. Who knows, we may be in a low interest environment for a long time. I would also limit discretionary spending until the debt was gone. $1.8k @ 5.5% ($50/month) $4.6k @ 4.6% ($25/month) $5.4k @ 2.88% ($63/month) Variable ...
by Rodc
Sun Mar 01, 2015 12:22 pm
 
Forum: Personal Finance (Not Investing)
Topic: Debt Snowball with Variable Rates
Replies: 6
Views: 643

Re: Do I have enough to retire at age 50?

How did you come up with that Net worth figure? Did you totally ignore the two pensions and SS? Including pensions and SS as part of networth is controversial and as far as I can tell a fairly new invention. Do it if you want, but it is not standard practice here or anywhere else. Of course you fac...
by Rodc
Sat Feb 28, 2015 7:35 pm
 
Forum: Personal Finance (Not Investing)
Topic: Do I have enough to retire at age 50?
Replies: 28
Views: 3925

Re: Subaru and Consumer Reports ratings

... Outback & Forester would be on my our short list to replace our Honda Odyssey. That being said, I am not convinced Subaru is any more reliable than other makes. One reason I chose my Cadillac CTS over a Subaru was because at the time the maintenance requirements for the turbo model were pre...
by Rodc
Fri Feb 27, 2015 9:40 pm
 
Forum: Personal Consumer Issues
Topic: Subaru and Consumer Reports ratings
Replies: 100
Views: 8932

Re: Do I have enough to retire at age 50?

I note that if you sell the house and invest $300K you might be able to generate that level of income with no work and perhaps less risk (4% withdrawal pretty much). The median household gets by on about $50K/year. You can certainly live on your wife's salary. May or may not be the lifestyle you are...
by Rodc
Fri Feb 27, 2015 3:15 pm
 
Forum: Personal Finance (Not Investing)
Topic: Do I have enough to retire at age 50?
Replies: 28
Views: 3925

Re: Approaching 50...What to expect?

Learn to adapt. It's a very underrated skill. As we get older we no longer have physical abilities and the memory we once had. Know your limitations and live within them. We know a couple about our age who decided to go ice skating a few weeks ago after not having done it for decades. The man fell ...
by Rodc
Fri Feb 27, 2015 2:51 pm
 
Forum: Personal Consumer Issues
Topic: Approaching 50...What to expect?
Replies: 108
Views: 10154

Re: Are remote starters bad for cars?

Any car this century ...(t)he maximum you should generally warm up your engine is as 'wander' said "when the temperature gauge starts to move". Such this century cars may exist, but my cars from this century do not have temperature gauges. :) They did mid-last century though. :) Some of u...
by Rodc
Fri Feb 27, 2015 1:50 pm
 
Forum: Personal Consumer Issues
Topic: Are remote starters bad for cars?
Replies: 41
Views: 2637

Re: Are remote starters bad for cars?

They are awesome inventions. Why should I spend 30 seconds in discomfort, when I can inefficiently burn fossil fuels that have been in the ground for millions of years? I wonder about that 30 seconds. None of the cars I've owned have warmed up the passenger cabin noticeably in 30 seconds of idle. W...
by Rodc
Fri Feb 27, 2015 12:48 pm
 
Forum: Personal Consumer Issues
Topic: Are remote starters bad for cars?
Replies: 41
Views: 2637

Re: Are remote starters bad for cars?

Any car this century ...(t)he maximum you should generally warm up your engine is as 'wander' said "when the temperature gauge starts to move".


Such this century cars may exist, but my cars from this century do not have temperature gauges. :)

They did mid-last century though. :)
by Rodc
Fri Feb 27, 2015 12:40 pm
 
Forum: Personal Consumer Issues
Topic: Are remote starters bad for cars?
Replies: 41
Views: 2637

Re: Are remote starters bad for cars?

Who told you to let the car warm up or idle for a few minutes? This is an old wives tale It was some old gray haired lady. I had a hard time figuring out if she was just somebody's old wife or really was a witch, and so she made me kind of nervous. I was only a teenager so I figured best to just go...
by Rodc
Fri Feb 27, 2015 11:39 am
 
Forum: Personal Consumer Issues
Topic: Are remote starters bad for cars?
Replies: 41
Views: 2637

Re: Illiquid Assets

returns can be increased by increasing risk. The is false on its face. It you could increase returns simply by increasing risk you would have decreased risk. 2+2= 5 if and only if 2+2=4 cannot be true because it is internally inconsistent. You can increase expected return by increasing risk, but si...
by Rodc
Fri Feb 27, 2015 8:10 am
 
Forum: Investing - Theory, News & General
Topic: Illiquid Assets
Replies: 43
Views: 3432

Re: Are remote starters bad for cars?

I would be worried about the effect on the engine by warming at idle in the winter. When the engine is cold, lubrication is at its worst, and you would be prolonging operation with poor lubrication. As I recall, auto owners manuals suggest immediately after starting to drive at moderate speeds to w...
by Rodc
Fri Feb 27, 2015 8:00 am
 
Forum: Personal Consumer Issues
Topic: Are remote starters bad for cars?
Replies: 41
Views: 2637

Re: Subaru and Consumer Reports ratings

I live in the North East with this year's near record snow. I have a 2009 Forester, base model. It gets a fair amount of abuse hauling stuff to the dump, hauling scouts and camping gear, hauling climbing gear winter and summer. It is great in the snow. No problems, just over 100,000 miles. It goes s...
by Rodc
Thu Feb 26, 2015 12:48 pm
 
Forum: Personal Consumer Issues
Topic: Subaru and Consumer Reports ratings
Replies: 100
Views: 8932

Re: 10 Interesting facts about the S&P500

So, when you download the Shiller data that lists price, dividend, and earnings for the S&P composite back to 1871, what exactly is it really showing? Sounds like a nice little Google project as to how that reconstruction was performed. I recall, hazily, that the Fama-French reconstruction of t...
by Rodc
Thu Feb 26, 2015 7:19 am
 
Forum: Investing - Theory, News & General
Topic: 10 Interesting facts about the S&P500
Replies: 28
Views: 3629

Re: 10 Interesting facts about the S&P500

Cap weighted indexes systematically overweight the most expensive stocks and underweight the cheapest. That's how they're designed. Some would say that's a fatal flaw. The problem with that logic is the following. Company A has sales of X and profits Y and 1000 shares that sell for $Z. Company B ha...
by Rodc
Wed Feb 25, 2015 6:42 pm
 
Forum: Investing - Theory, News & General
Topic: 10 Interesting facts about the S&P500
Replies: 28
Views: 3629

Re: 10 Interesting facts about the S&P500

Speaking of streaks and interesting patterns, since 1928 the S&P 500 has had more than 50 instances where it's advanced at least eight days in a row.


Pretty good for an index started in 1957...
by Rodc
Tue Feb 24, 2015 4:22 pm
 
Forum: Investing - Theory, News & General
Topic: 10 Interesting facts about the S&P500
Replies: 28
Views: 3629

Re: Value investing doesn't even beat the S&P 500

The methodology cited in this article and the also mentioned Dalbar study is flawed and can overstate the performance gap between investor and index returns. As others mentioned, this has nothing to do with value as even straight index investors can seem to suffer the same fate. The Finance Buff do...
by Rodc
Tue Feb 24, 2015 1:08 pm
 
Forum: Investing - Theory, News & General
Topic: Value investing doesn't even beat the S&P 500
Replies: 45
Views: 4458

Re: How much did you have saved up for retirement at age 30?

Zero. I was still in grad school.

It was enough because I am nearing retirement and all is well.
by Rodc
Tue Feb 24, 2015 1:01 pm
 
Forum: Personal Finance (Not Investing)
Topic: How much did you have saved up for retirement at age 30?
Replies: 173
Views: 12992

Re: Thoughts on replacing tires?

In my experience, snow tires are a necessity on a rear wheel drive car. For front wheel drive, the all season tires do just fine. Of course, snow tires would be better on a front wheel drive car, but you would need them on all for wheels, and it is not really necessary. My front wheel drive cars ha...
by Rodc
Tue Feb 24, 2015 12:58 pm
 
Forum: Personal Consumer Issues
Topic: Thoughts on replacing tires?
Replies: 60
Views: 3572

Re: ? present value of soc sec and pension

Go to an insurance site. Find an insurance product that is close to each option. Get a quote. with a COLA on first $18,000 of up to 3% based on 50% of the CPI Are you in MA? I'm curious why you asked this, Rodc. Are MA residents in some sort of unique situation? MA state pensions behave this way (o...
by Rodc
Tue Feb 24, 2015 11:25 am
 
Forum: Investing - Theory, News & General
Topic: ? present value of soc sec and pension
Replies: 37
Views: 2995
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