techcrium wrote: ↑Wed Jun 20, 2018 3:33 pm
I'm really not sure how that analogy applies. Like if the music stops = market crashed? If the market crashes 85%, then I might be on the verge of financial ruin...but at that point, I would believe the whole world would be in financial ruin too...
If you take any kind of class that involves risk management, motorcycle safety and SCUBA are two examples, they will go over how accidents (where people get hurt) occur when a number of events occur. Perhaps the motorcycle wreck occurred because the bike needed new brakes, had under inflated tires, the driver was not 100% paying attention, and a person pulled out in front of them. In that case it is easy to blame the person pulling out in front of you, but one has to be prepared to take responsibility for the actions they take.
In the end, I hope that things work out really well for you and it seems like you are paying attention. However, please recognize that you are exposing yourself to significant risks.
Could your credit card interest shoot up to 23% overnight? Yup.
Could you lose your job? Yup.
Could your relative demand that you repay in full immediately? Yup.
I feel like you understand, at least somewhat, the compounding risk of buying on the margin. Interest rates could change and you could have a call at a horrible time to sell.
The IT field is not bullet proof and is actually highly susceptible to a recession. You could lose your job. One of the first areas that companies tend to cut, because it is so expensive, is IT when times get tough. Myself I found myself very under/unemployed for about three years after the twin towers came down. It was not until 2016 I was making the kind of money that I was making in 2001.
When you fiddle with debt, you are playing a game of musical chairs.