tag:blogger.com,1999:blog-31427364.post5996490560922629015..comments2024-03-26T03:52:23.395-07:00Comments on Housing Analysis: How we paid off our house in three yearsmohicanhttp://www.blogger.com/profile/06094213357140749289noreply@blogger.comBlogger11125tag:blogger.com,1999:blog-31427364.post-58828910481070854772007-04-10T08:46:00.000-07:002007-04-10T08:46:00.000-07:00For some reason this story reminds me of an old jo...For some reason this story reminds me of an old joke I've heard as a kid while still in Europe:<BR/>This old rich man comes back to the old country after years of immigration and he brings in coffers of money.<BR/>Everybody wonders how did he become so stinking rich in America, so he explains:<BR/>-Well, I was unemployed, broke and starving and one day while wandering the streets I found a potato.<BR/>So I wrapped in tinfoil, cooked it and sold it for a dollar.<BR/>With the dollar I earned I bought few more potatoes which I prepared and sold the same day. Made a few bucks this way, bought more potatoes - you got the picture...<BR/>I continued that for a week and then I won the State Lottery.vintagehttps://www.blogger.com/profile/16881836706802713507noreply@blogger.comtag:blogger.com,1999:blog-31427364.post-63326565074313209992007-04-08T13:57:00.000-07:002007-04-08T13:57:00.000-07:00"Why are some of you so pissed off?"Who is pissed ..."Why are some of you so pissed off?"<BR/><BR/>Who is pissed off?freakohttps://www.blogger.com/profile/06236681769619303395noreply@blogger.comtag:blogger.com,1999:blog-31427364.post-45001149557224597622007-04-08T12:19:00.000-07:002007-04-08T12:19:00.000-07:00Why are some of you so pissed off? I think that th...Why are some of you so pissed off? I think that the point of the story is that one has to make some sacrifices to get what he wants.<BR/>As opposed to the free luch - gimme now mentality pandemics.<BR/><BR/>Sure, they are stretching it a bit too far... still a good contrast to the debt junkies.Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-31427364.post-69859232162355378652007-04-07T15:05:00.000-07:002007-04-07T15:05:00.000-07:00"There are two things that Perry did: top line gro..."There are two things that Perry did: top line growth and bottom line growth."<BR/><BR/>Don't forget that it is not just "what" but "when" that matters. As mentioned, all investments earn a real return. The higher the risk, the higher the return. <BR/><BR/>If a person at age 19 had a chance to earn serious money, say working construction in Saudi Arabia and spend as little as possible. Might not be an enjoyable experiance, BUT:<BR/><BR/>1. Hard work and lack of comforts/pleasures does give perspective and promotes maturity.<BR/>2. If invested at such a young age, high risk is acceptable, so it will earn a very high return.<BR/><BR/>The equities market has earned about 7% long run real return. <BR/><BR/>$120,000 invested at age 19 would be cross the $1 million mark in the 50th year of age. You know what, if I had access to a time machine ...<BR/><BR/>Also, if took all the money I spent on booze between the ages of 17 and 22 and had instead invested it in 100% equities ...<BR/><BR/>I don't smoke and never did, but the math would work along the same lines.freakohttps://www.blogger.com/profile/06236681769619303395noreply@blogger.comtag:blogger.com,1999:blog-31427364.post-44479186990962179252007-04-07T08:55:00.000-07:002007-04-07T08:55:00.000-07:00Recent anecdotal (& thus methodologically limited)...Recent anecdotal (& thus methodologically limited) research asked people to survey their lives thus far.<BR/>The core result was that people reported regrets of omission rather than commission.<BR/>They wish they'd taken more risks, and done more things. They didn't say "I should have eaten KD for ten years and paid off that loan instead of backpacking around Europe".<BR/>(That said, some may have had regrets that thay'd had to work for 'the man' to pay of xyz, rather than (whatever activity may have been more valuable to them). So this is not an endorsement of wanton spending. I like the way that freako summed it up above).<BR/><BR/>On your deathbed, it's unlikely that you'll be saying "I should have sat on more committees". (I heard that somewhere, can't quote source).rentahhttps://www.blogger.com/profile/15702043040945599471noreply@blogger.comtag:blogger.com,1999:blog-31427364.post-16436890315931212562007-04-06T19:48:00.000-07:002007-04-06T19:48:00.000-07:00I think Rob Chipman wrote this article. Affordabi...I think Rob Chipman wrote this article. Affordability issues? There are no affordability issues, you're just not working hard enough.Unknownhttps://www.blogger.com/profile/11019753664340588845noreply@blogger.comtag:blogger.com,1999:blog-31427364.post-40686149499204008792007-04-06T17:18:00.000-07:002007-04-06T17:18:00.000-07:00I guess Calvinism never really died out.The majori...I guess Calvinism never really died out.<BR/><BR/>The majority of people I know that have done this sort of thing have either died too early to enjoy their savings, or did live long enough to do so, but were so acclimatized to the ascetic lifestyle that they could never slow down and enjoy it, and kept going til they died in the saddle. <BR/><BR/>I do not know of anyone lying on their deathbed, saying "you know, I should have worked more...."Clarkehttps://www.blogger.com/profile/01598503256501613406noreply@blogger.comtag:blogger.com,1999:blog-31427364.post-67325611973706045892007-04-06T13:24:00.000-07:002007-04-06T13:24:00.000-07:00I have lots of opinions on this, as I studied in d...I have lots of opinions on this, as I studied in detail in school.<BR/><BR/>I knew it as the Robinson Crusoe dilemma (or something like that). We know it as the propensity to save.<BR/><BR/>You can consume today. But if you forego consumption today, you can consume even more tomorrow (real returns). So what is the right answer? That depends on the individual. BUT: The two extremes are generally undesirable. <BR/><BR/>Saving nothing (or worse, going into debt) allows you to live well today, but at the expense of tomorrow. Second, since most of us are genetically programmed to worry about the future, we may actually be miserable in the present AND the future. <BR/><BR/>The other extreme, is to live like a pauper until death. Some obviously derive pleasure and security from such hard earned wealth, but if for most people it is a winning propostion.<BR/><BR/>A couple of other things to note: <BR/><BR/>For a given amount of consumption, you generally get the most pleasure out of spreading it out For example, eating a chocolate bar a day will give you more satisfaction than eating 7 once a week. For the same reason, it is preferably to spread consumption over your lifetime, but somewhat biased towards later in life. Firstly because of real returns (you may prefer two chocolate bars next week instead of one this week). Second, past consumption may lead to regret, but anticipation of future consumption leads to excitement (the msot enjoyable part of Christmas is looking forward to receiving and opening the gift, not possession of the gifts themselves). <BR/><BR/>For this reason it is advisable to spread out consumption over our lives. But since our incomes are not evenly distributed , we can use borrowing and savings to smooth out consumption. For example, a med school student has a high probability of high future earnings, so going into debt to lead a decent existence while in school is not a bad thing. Similarly, most of us expect our incomes to decline in our later years, so we save during our peak earning years.<BR/><BR/>Finally, we all differ in the ways we deal with unknowns or stresses. Some live fulfilling lives despite having been given a only a few years to live due to cancer. Others have everything but can't shake the smallest cloud on the horizon. If you fall into the latter category, the best action for you may have been to act such as the narrator in this post did. Namely bite the bullet, and make some material sacrifices to put his financial house in order and mind at ease.<BR/><BR/>What does this all have to do with housing? The traditioanal "work, save and controlled consumption" model has been blown out of the water by the housing boom. I don't think there has been such reckless abandon and sense of false entitlement since the roaring 20's. And we know what followed. In fact, the lessons learned in the Great Depression served us for a long time. Even the famed tech bubble was not as pervasive as popularly believed. Most people had their savings tucked into GIC's, savings bonds, homes, and well diversified equities. Not so this time. Another amazing fact out of the States is that a good portion of defaults are due to HELOC's. Some of the owner's in trouble bought 15 years or more ago. They just got greedy with the home equity cash machine.freakohttps://www.blogger.com/profile/06236681769619303395noreply@blogger.comtag:blogger.com,1999:blog-31427364.post-61669836016497124892007-04-06T09:29:00.000-07:002007-04-06T09:29:00.000-07:00Seems to me this couple may, or may not, need a fi...Seems to me this couple may, or may not, need a financial advisor, but they could sure use some mental health help.<BR/><BR/>We had neighbours like this couple. The man died of a heart attack at 54. <BR/><BR/>She ended up marrying a "reformed" alcoholic/drug addict etc etc, from her church group.<BR/><BR/>The guy had never had a full time job in his life, but ended up with a nice house, slightly used car, and I suspect, he was banging some of her friends as well.tulip-Mania2https://www.blogger.com/profile/01482331067557664647noreply@blogger.comtag:blogger.com,1999:blog-31427364.post-91555220987342034612007-04-06T09:26:00.000-07:002007-04-06T09:26:00.000-07:00What ever happened to "I could get hit by a bus to...What ever happened to "I could get hit by a bus tomorrow" Can we say B-A-L-A-N-C-E.Warrenhttps://www.blogger.com/profile/00586650821846362670noreply@blogger.comtag:blogger.com,1999:blog-31427364.post-49295441547991453252007-04-05T20:15:00.000-07:002007-04-05T20:15:00.000-07:00Exactly,Everyone should be working 100 hours weeks...Exactly,<BR/><BR/>Everyone should be working 100 hours weeks and cutting back to just buying food in order to buy a condo in Vancouver.Ponderinghttps://www.blogger.com/profile/02045248084037830482noreply@blogger.com