tommyGunZ
Footballguy
I hear you w/re to piece of mind. It's extremely difficult to put a price on that. Each person has their own risk tolerance, and I certainly don't begrudge those whose tolerance is less than/greater than mine.That being said, you cite your personal financial history in a discussion re: wisest use of economic resources. Why would you put that out there if you haven't even bothered to do the legwork to know if your own personal course of action was correct? And w/re to your last sentence, it's great that you're in "good shape financially", but aren't you curious about what type of shape you would be in had you invested in equities instead of paying off your mortgage early?I don't know. We started in '94 at 9.25% and refinanced a few years later at 7something. I'm sure you'll throw stats that show we did the wrong thing somehow but that's not how we think. Same with the 401k that you commented on. We can probably retire now on that money. Yes, it's not the smartest thing to have pulled out and stayed out for this long, but oh well. Peace of mind. We are in really good shape financially and don't want anyone else to ruin it.I'd be interested in hearing how that decision worked out. Over the course of those 12 years, was your mortgage rate greater than the aggregate market return?A complete overreaction. All that is happening is turning a ship around. These were minor steps and if you think the debt limit debate was extreme, you are in for a rude awakening. My wife and I don't wait to time our payments for when rates are right, we do it as soon as possible. We paid our 30 year mortgage in 12 years. We paid off our Explorer in a couple of years. We use a line of credit for home repairs and pay it off asap. When we owe, we scrimp until it is paid off. We are close to buying a 3 family home as a rental property. Believe me, we will be bare bones, pasta and pizza until most of it is paid off. We don't buy anything that we won't be able to pay off quickly and even then we live a low-key life. I don't buy every gadget on the market, my wife only goes shopping when she needs to. Blame Obama, blame Bush, who cares. This me attitude has to change. I'm not talking about you, but society in general.Really? Did you pay cash up front for your college education? I didn't. I took out student loans. I was fortunate that I could borrow cheap money to do it, and that investment has paid off big time by providing me with a career I'd never have gotten without my college education. If I had set my goals lower, I could have paid off my bills, kept my job bagging groceries, and maybe moved up to cashier if I'd played my cards right. That would have been the fiscally responsible thing to do.There's no time like the present to address these issues. You expect them to be elected yet not bring up things that are central to their beliefs? Sorry if the timing doesn't suit you. You may not pay down debt, but you do start cutting your spending when you're struggling to pay your bills.
But instead, I invested in my future, like someone who believed that they could do more than just survive. I planned on growing, and I did, using debt when I didn't have money, and paying it down when I started earning. Since then, my income has continued to grow, and I've occasionally borrowed money for large purchases or to cover major life events.
And yes, I pay off my debt, but I do it the way successful companies do, and the way the government should, too. I pay down debt when the interest is more expensive than what I could earn on my money right now. I make an educated decision on what to buy based on how much it would cost, including interest, and sometimes I pay down extra against the principle, if I am flush with cash or if putting my money in savings would earn less than what I'm paying in interest.
What I absolutely do not do is wait until I've lost my job and I'm broke, then start pointing fingers at my old boss, sell my car and my work clothes and my computer to pay down debt, and then try to find a way to get some income again. That would be ridiculous. I don't run my life like that and I don't support it in public policy, either.
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I've read a great deal about this issue when compared to the average joe but I'm still lost.