Will Austin Home Prices Continue to Increase?

[gpurcell]

Originally Posted by scm53

If you are stupid enough to not reallocate your portfolio as you near retirement, you deserve your cat food dinner.

If you reallocate during a downturn you aren't any better off.

[scm53]

Originally Posted by gpurcell

If you reallocate during a downturn you aren't any better off.

Obviously. That's why you "reallocate your portfolio as you near retirement." You don't do it all at once. If you are too stupid to do it, retirement date mutual funds do it for you. There is no excuse for stupidity.

[austin-steve]

Originally Posted by riaelise

...
The moral of this story is different strokes for different folks.

Agreed. I think what you are doing is right for you. You have a plan, you don't over-extend yourself. You are responsible and thoughtful about how to reach your retirement destination. I was never saying that you specifically should refi to a 15 year note.

Originally Posted by RoadWarrior12

I don't know if I'd go that far. It's not like there's anywhere in life that you're guaranteed to get an education in investing or retirement planning. Many people just work their job and contribute to a 401K and have no idea how everything works - that doesn't make them "deserve their cat food".

Agreed. I think reallocating a stock portfolio annually is beyond the typical investor's ability. And it's not about being smart. I'm "smart enough" to figure it out, but I know that I won't be disciplined enough so I put all my IRA funds into a Vanguard Target Retirement fund (which is really a fund of 5 other funds) and they rebalance it for me as I age. I don't have to think about it at all.

Steve

[balor123]

Financial planning is a function both of willingness and ability to take risk. Another way to look at this problem is that paying down the mortgage increases your ability to take risk elsewhere, since one of your basic needs (shelter) is no longer threatened.

[hts]

Originally Posted by balor123

Financial planning is a function both of willingness and ability to take risk. Another way to look at this problem is that paying down the mortgage increases your ability to take risk elsewhere, since one of your basic needs (shelter) is no longer threatened.

I don't follow. How does refinancing from a 30- to a 15-yr note increase one's ability to take risk elsewhere? Most of us aren't fortunate enough to have the financial resources required to both pay down one's mortgage early AND make sizable investment contributions -- it's an either/or proposition (I know I'm oversimplifying a bit here).

[balor123]

You'll likely have paid off the 15-yr note before retirement, giving you some options to take more risks while you are still making money.

[hts]

Understood--thanks for clarifying.

[balor123]

I think that's the first time anyone has ever thanked me on a forum. I'm more accustomed to unprovoked insults. I appreciate that

[TexasHorseLady]

Some years ago, we paid off our house in town. At the time, our financial planner (yes, we do have one, and a very good one) told us, "If there was anything that I could tell you to invest in that would beat that, I'd tell you to do that, but this is the absolute best thing you can do with your money at this time." (We already had a stock portfolio.) We also refinanced the ranch to lower our interest rate, and went from 30 to 15 year at the same time. Looking at the monthly figures, we realized that if we threw in $130/month in extra principle payments on that, not only would we shorten even the 15 years to payoff, and pay less interest, we would be paying within a couple of dollars exactly what we'd been paying before every month and were used to. That's what we've done, and so in a little less than a year as we are both retirement age it will be paid off, as well, and living out here with our ag valuation our housing expenses including tax and insurance will be in the $200/month range and the house in town will pay its own much higher taxes and be a source of income for us as a rental property.

However, one trick to all of this is that when we were young and poor, we still managed to save 20% almost every month, having been told that was the way to do it. We didn't have extravagant tastes or expectations or expect to be, at that stage in life, where our parents were at theirs, so that wasn't terribly difficult.

[hound 109]

Originally Posted by balor123

I think that's the first time anyone has ever thanked me on a forum. I'm more accustomed to unprovoked insults. I appreciate that

You two get a room.......Now, let's get back to the fur flying.