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Old 08-22-2018, 07:38 AM
 
Location: Grosse Ile Michigan
24,717 posts, read 59,579,994 times
Reputation: 26822

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If you find the solution, please go back in time and tell me about it.

Especially when it comes to kids. If you have the money to allow them to attend that awesome private school, they why not? If you have the money for some cool family camping trips - or an a nice new conversion van to road-trip in - go for it. 5 sets of braces @ $5000 each? Well you need to have straight teeth.

For us, we did not suddenly start making a ton, we had maybe a 25% increase year by year until finally topping out. Our expenses just kept increasing with the income. We did not go buy a big Motorhome or a boat or anything, things just kept getting more and more expensive. We did buy some little things that we might no have otherwise.

Unfortunately, when I could not take it anymore and took a less demanding job for less pay, our expenses did not go down. Even as the kids move out and set up on their own, I do not see a big decrease in our expenses.
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Old 08-22-2018, 08:32 AM
 
Location: NJ
22,670 posts, read 28,551,950 times
Reputation: 14611
Quote:
Originally Posted by Coldjensens View Post
If you find the solution, please go back in time and tell me about it.

Especially when it comes to kids. If you have the money to allow them to attend that awesome private school, they why not? If you have the money for some cool family camping trips - or an a nice new conversion van to road-trip in - go for it. 5 sets of braces @ $5000 each? Well you need to have straight teeth.

For us, we did not suddenly start making a ton, we had maybe a 25% increase year by year until finally topping out. Our expenses just kept increasing with the income. We did not go buy a big Motorhome or a boat or anything, things just kept getting more and more expensive. We did buy some little things that we might no have otherwise.

Unfortunately, when I could not take it anymore and took a less demanding job for less pay, our expenses did not go down. Even as the kids move out and set up on their own, I do not see a big decrease in our expenses.
i would think that the biggest cut would be the house. sell it and move to something more modest. but if your lifestyle has added a lot of nice conveniences like more eating out, higher end travel, etc. then its not going to to go away unless you need to reduce expenses. who wants to sacrifice things that make their lives better unless they have to?

i like my big house. its really not that big of an additional headache compared to the smaller house.
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Old 08-22-2018, 09:47 AM
 
Location: TN
86 posts, read 39,232 times
Reputation: 195
As some of the other posters have mentioned, keeping your car for just a couple years longer than your payment will pay you back 100 times over. I personally keep my cars at least 8 to 10 years but people that drive more miles than I do probably don't keep cars as long.

Think about this plan to eventually pay for your new cars with cash. If you buy a new or newer car and have a car payment keep that car until it's paid off. Then keep it AT LEAST 2 more years and put the amount of your car payments in the bank. Then when it's time to buy a new car you will have a bigger down payment. If you do this a couple of times you should never have a car payment ever again... unless you upgrade to a Ferrari!

Fun fact: In 90+% of households the second largest debt behind a mortgage are car payments. Mortgage debt is "good" debt. Car debt is "bad" debt.
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Old 08-22-2018, 09:51 AM
 
Location: NJ
22,670 posts, read 28,551,950 times
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Quote:
Originally Posted by andyd522 View Post
Fun fact: In 90+% of households the second largest debt behind a mortgage are car payments. Mortgage debt is "good" debt. Car debt is "bad" debt.
why is mortgage debt good and car debt bad?
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Old 08-22-2018, 09:55 AM
 
189 posts, read 57,736 times
Reputation: 482
Quote:
Originally Posted by CaptainNJ View Post
why is mortgage debt good and car debt bad?

Um - Because houses generally increase in value. You are "making money" on your loan.

Cars lose value. At some point you will owe more on your car than it is worth.


Borrowing money to purchase an appreciating asset is called investing. Borrowing money to purchase a decreasing asset is not.
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Old 08-22-2018, 09:56 AM
 
247 posts, read 100,240 times
Reputation: 540
I don't get this. If you are the head of a household and suddenly see yourself earning way less than what would allow your family to have certain luxuries (luxuries that most people insist are neccesities), you HAVE to adjust whatever needs to be adjusted to live within your means. And that includes putting your foot down in regard to whatever you have made your family accustomed to. You simply tell them that "things are going to change around here. Sorry (not sorry)." That's why you are the head of the houselhold; you make the rules.

Also, the whole thing about things getting more expensive I can understand up to a point. But another issue is that most people start earning more and suddenly start to purposely buying more expensive stuff "because they can," which is a grave mistake. Just because I get promoted doesn't mean I have to start buying a 7-dollar dandruff shampoo bottle when my trusty 4-dollar Suave dandruff shampoo is perfectly fine. If I happen to enjoy canned corned beef, why do I need to buy expensive cuts of meat once I get more money? I bet that has a lot to do with, once again, how society conditions us to perceive and define "success" and "nice things"; we adhere to the whole axiom of "I work too hard NOT to spend money on nice things. If I am getting so much money, and I work hard for it, I will certainly spend it a lot on nice things."
Such BS.
Then a lot of us blame it on inflation.
We need to live within our means and we need to break away from social narratives that lead us to overspending.
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Old 08-22-2018, 09:58 AM
 
247 posts, read 100,240 times
Reputation: 540
Quote:
Originally Posted by northshorenative View Post
Um - Because houses generally increase in value. You are "making money" on your loan.
Not really.

For most people (unless you happen to live in a wonderfully safe, highly desirable neighborhood in a major city that is also highly desirable), the "homes appreciate in value" thing is just a social construct, a myth.

https://www.cnbc.com/2017/11/16/home...udy-finds.html
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Old 08-22-2018, 10:23 AM
 
2,008 posts, read 1,799,661 times
Reputation: 3337
Quote:
Originally Posted by andyd522 View Post
One piece of advice that I read from Warren Buffett that really stuck with me. There's 2 ways to look at your monthly income.

#1 - Spend what you want for the month and then save what's left.

#2 - Save to meet your longterm goals and then spend what's left.

If you choose #1 you might be happy today but if you choose #2 you will be happy for a lifetime.
Great advice!
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Old 08-22-2018, 12:09 PM
 
Location: Atlanta
3,057 posts, read 2,976,848 times
Reputation: 1876
Quote:
Originally Posted by Oramasfella View Post
Absolutely absurd.
Especially when you think about how those women are sheep. I am sure they were the same people who would not be caught dead with a big ass 5.5 inch-screen iPhone when society told us that the cool, trendy thing to have was a tiny, convenient, inconspicuous flip phone. Now the tide has turned, and the bigger the screen, the "better," so people follow the trends like the sheep they are.





^^^^SO much awesome truth in that post!
I also think about how much inconveniences/expenses come along with bigger homes, bigger cars, more clothes, etc. I'd rather focus on people than on things I own (which, like the old axiom says, [the things you own truly] end up owning you).
Quote:
Originally Posted by Oramasfella View Post
I don't get this. If you are the head of a household and suddenly see yourself earning way less than what would allow your family to have certain luxuries (luxuries that most people insist are neccesities), you HAVE to adjust whatever needs to be adjusted to live within your means. And that includes putting your foot down in regard to whatever you have made your family accustomed to. You simply tell them that "things are going to change around here. Sorry (not sorry)." That's why you are the head of the houselhold; you make the rules.

Also, the whole thing about things getting more expensive I can understand up to a point. But another issue is that most people start earning more and suddenly start to purposely buying more expensive stuff "because they can," which is a grave mistake. Just because I get promoted doesn't mean I have to start buying a 7-dollar dandruff shampoo bottle when my trusty 4-dollar Suave dandruff shampoo is perfectly fine. If I happen to enjoy canned corned beef, why do I need to buy expensive cuts of meat once I get more money? I bet that has a lot to do with, once again, how society conditions us to perceive and define "success" and "nice things"; we adhere to the whole axiom of "I work too hard NOT to spend money on nice things. If I am getting so much money, and I work hard for it, I will certainly spend it a lot on nice things."
Such BS.
Then a lot of us blame it on inflation.
We need to live within our means and we need to break away from social narratives that lead us to overspending.

Wish I could rep you more...especially for the first post. Very wise insights and I could not agree with you more!
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Old 08-22-2018, 12:21 PM
 
3,962 posts, read 1,590,532 times
Reputation: 12380
It is a deliberate decision, based on knowing the difference between wants and needs.



When we bought our current home, the mortgage underwriter said, "Why are you buying this house? You could afford one three times this amount." Because we didn't need it.



Now that our last child is out of high school, we don't need a big house. So we're downsizing. In fact, we're waiting for an offer from an interested buyer. We're going to move into an apartment two blocks from my wife's office (I work out of the house) and will start planning our next move.
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