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Old 08-28-2018, 07:59 PM
 
Location: Henderson, NV
7,087 posts, read 8,611,008 times
Reputation: 9978

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Quote:
Originally Posted by Thatsright19 View Post
They’re very very rare. They were very destructive during the housing crisis.
I’m not really sure why to be honest, either way you’re mainly paying interest for the first few years For me it just made sense as I wanted to eliminate the debt as soon as a few other investments cashed out. I wouldn’t be doing that on my next house though, but even then it’s tough for me to imagine not paying off the mortgage in 4-5 years most likely.

My biggest issue is probably psychological, when it comes to debt. I’ve never lived above $6,000/month expenses and that was in LA where I lived a very mediocre lifestyle on $5,500 or so most months. Amazing you can spend that much and live so mundane haha. My income will increase a lot next year and a lot again a few years after that. I think that’s why I don’t like the idea of a larger mortgage though because I’m unaccustomed to a higher income so higher expenses just seem scary

The best analogy I can give is bed times. When I was 14, going to bed after midnight seemed late. Now I usually don’t sleep until 5-6 am, so I can’t ever think of midnight as late again. It’s early to me and has been for more than a decade. Money is similar, I think of the idea of spending $10K/month as kind of crazy because I haven’t regularly made that much. But if I’m sitting there for a while making twice that, I’m sure I would adjust to the new normal. I find it hard to imagine immediately adjusting though to spending more money, I feel like if your mind has always been stuck in “$5K/month is a lot of money for expenses,” you can’t just snap your fingers and think of it as not much until you see your income vastly exceeding that for long enough to realize, ok, this is normal now.

 
Old 08-28-2018, 08:03 PM
 
18,073 posts, read 18,754,030 times
Reputation: 25191
Quote:
Originally Posted by kyam11 View Post
No it actually is not. Again simple first year finance teaches you risk is a metric and is quantified. It has a number associated with it. Since there is no deviation to the return (or savings) of the rate meaning if you pay a 4% mortgage off the std deviation will be 0 since it cannot deviate from that rate. Since it has a std deviation of 0 it is now and will always be considered risk free.

Again stop acting like you understand something when you do not. Risk is a quantifiable measure in finance.

The underlying asset does have risk. Why? Because the quantifiable amount of risk is not 0. The value can go up and it can go down thus providing a deviation of value. A 3month T bill is considered risk free because there is no deviation to the rate of return. It has a std deviation of 0 (or at least is accepted of having 0 since the US govt won't default).

None of this is my opinion.
Lol, yea, seems you are the one having issues understanding simple concepts, at least I know I get paid for my financial services...

Whatever though, do and believe as you want, has no impact in my life.
 
Old 08-28-2018, 08:04 PM
 
964 posts, read 873,174 times
Reputation: 759
Quote:
Originally Posted by boxus View Post
Lol, yea, seems you are the one having issues understanding simple concepts, at least I know I get paid for my financial services...

Whatever though, do and believe as you want, has no impact in my life.
You don't even understand risk.
 
Old 08-28-2018, 08:10 PM
 
Location: Richmond, VA
5,041 posts, read 6,329,712 times
Reputation: 7197
Quote:
Originally Posted by mathjak107 View Post
He is still the best researcher around . I don’t have to agree with his analogy’s but his concept is correct

I see no where he said you need a million dollars

That was a thread title, posted by a different user, so you could link to where you called him "famed researcher". Neither he nor I said you need a million dollars.



If he's still the best researcher around, perhaps you should listen to him about the original concept of paying off the mortgage early. Otherwise, you are only agreeing with the "best researcher around" when you like what he has to say. That's a bit disingenuous on your part. If you believe he's wrong about this basic concept, what else is he wrong about?
 
Old 08-28-2018, 08:13 PM
 
964 posts, read 873,174 times
Reputation: 759
He keeps digging that hole deeper
 
Old 08-28-2018, 09:09 PM
 
Location: We_tside PNW (Columbia Gorge) / CO / SA TX / Thailand
34,661 posts, read 57,789,143 times
Reputation: 46126
Quote:
Originally Posted by UnfairPark View Post
Is there a website with information about percentage of paid off homes in every town? Just for fun, to see which town has more fiscally responsible crowd.
paid off homes = fiscally responsible

Is that along the same lines as 'Personal residence' = an Asset (rather than the liability it truly is)?

Fiscal responsibility is a term related to government spending and taxation

Pray tell... I do not EVER want to be 'associated' with our Government fiscal bosses

They... probably consider a personal residence an 'investment'!!! Of course it IS to them... it funds / fuels their pig trough (taxes / permits / economic valuation and exchange)
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