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Old 04-18-2015, 01:54 PM
 
Location: Loudon, TN
5,790 posts, read 4,843,885 times
Reputation: 19489

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Quote:
Originally Posted by jrkliny View Post
What is complicated about paying a car loan? You can even set the payment automatically from your bank account.
I didn't mean that it was complicated. I just meant one less thing (debt) to think or worry about, not to mention saving the money wasted on interest. Debt-free just feels so much better, clean and simple. Every bill I have is on auto-pay, duh, that's sort of a no-brainer.

Last edited by TheShadow; 04-18-2015 at 02:29 PM..
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Old 04-18-2015, 02:15 PM
 
Location: Kansas
19,185 posts, read 15,034,421 times
Reputation: 18249
Nothing compares to the feeling of being debt-free! Nothing!
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Old 04-18-2015, 02:16 PM
 
6,288 posts, read 4,740,348 times
Reputation: 12894
Quote:
Originally Posted by TheShadow View Post
..Debt-free just feels so much better......
Someone - perhaps you - mentioned paying off a 1.9% loan. That is almost like having free money. Giving up that money would not make me feel better, just foolish.

We seem to have lots of folks extolling the virtues of being debt free even if the interest rate is very low. I wonder how many of you run credit card debts. Statistics tell us lots of people do.
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Old 04-18-2015, 02:24 PM
 
Location: Loudon, TN
5,790 posts, read 4,843,885 times
Reputation: 19489
Quote:
Originally Posted by TuborgP View Post
Not trying to be snarky but keep in the back of your mind and no need to comment and ask people, but how many responding have 200k to be planning with themselves along with pensions and SS that pay their expenses? You did ask similar situation.
We do. Except that we are not old enough for SS yet. Our pensions cover our living expenses. A paid-off rental property gives us a little surplus and breathing room. DH has a 457 and I have taxable accounts of approx the size in question. So far we haven't tapped into the taxable accounts yet. I have a more aggressive risk tolerance than the OP, since I know our baseline is absolutely covered, and that we have two SS payments phasing in over time (DH in 2 years, me much later) to cover inflation and future travel plans. We could pay off our mortgage if we cashed out my accounts and sold our rental, but that would leave us very un-liquid, if that's a word, and we don't plan on living in this house forever, maybe 10 more years. We pay a very reasonable mortgage payment of less than 20% of our monthly income (at 3.87%).

We have our money in various funds. Mostly index funds and ETF's. I recently shifted some from my non-index, underperforming funds into Schwab's Intelligent Portfolio. It's a fully automated portfolio of ETF's, geared to your personal risk profile, that is designed to follow the market (like index funds). The great part is that it automatically rebalances your portfolio, as overtime it will naturally get out of balance in terms of asset allocation. The cool part is that you don't have to monitor and rebalance it yourself. It also is very tax efficient because it harvests losses to balance out your capital gains thereby minimizing your tax liabilities. I may transfer more of my other funds into the Intelligent Portfolio, I will follow it this year and compare performance to see how it goes before crossing that bridge.

Last edited by TheShadow; 04-18-2015 at 02:37 PM..
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Old 04-18-2015, 02:27 PM
 
Location: Loudon, TN
5,790 posts, read 4,843,885 times
Reputation: 19489
Quote:
Originally Posted by jrkliny View Post
Someone - perhaps you - mentioned paying off a 1.9% loan. That is almost like having free money. Giving up that money would not make me feel better, just foolish.

We seem to have lots of folks extolling the virtues of being debt free even if the interest rate is very low. I wonder how many of you run credit card debts. Statistics tell us lots of people do.
Sorry to disappoint you, we've have never carried credit card debt. It's just stupid to spend money I don't have. I save for things I need or want, then buy. I've done it that way since I was in my 20's. We have a couple major credit cards, but just to make sure we have a good credit rating. We only use them for travel and internet purchases and pay off completely every month.
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Old 04-18-2015, 02:38 PM
 
71,697 posts, read 71,801,099 times
Reputation: 49262
there are folks who really are not interested in maximizing every dollar in some investment. many are happy attacking it from the other end cutting debt and lowering expenses regardless of the investment they could make.

i have all the money i want in volatile investments at his point which now meet our spending goals and then some.

i am not interested in adding anymore money in to investments. we will pay cash when we buy the co-op.
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Old 04-18-2015, 02:41 PM
 
29,782 posts, read 34,880,403 times
Reputation: 11705
Quote:
Originally Posted by TheShadow View Post
We do. Except that we are not old enough for SS yet. Our pensions cover our living expenses. A paid-off rental property gives us a little surplus and breathing room. DH has a 457 and I have taxable accounts of approx the size in question. So far we haven't tapped into the taxable accounts yet. I have a more aggressive risk tolerance than the OP, since I know our baseline is absolutely covered, and that we have two SS payments phasing in over time (DH in 2 years, me much later) to cover inflation and future travel plans. We could pay off our mortgage if we cashed out my accounts and sold our rental, but that would leave us very un-liquid, if that's a word, and we don't plan on living in this house forever, maybe 10 more years. We pay a very reasonable mortgage payment of less than 20% of our monthly income (at 3.87%).

We have our money in various funds. Mostly index funds and ETF's. I recently shifted some from my non-index, underperforming funds into Schwab's Intelligent Portfolio. It's a fully automated portfolio of ETF's, geared to your personal risk profile, that is designed to follow the market (like index funds). The great part is that it automatically rebalances your portfolio, as overtime it will naturally get out of balance in terms of asset allocation. The cool part is that you don't have to monitor and rebalance it yourself. It also is very tax efficient because it harvests losses to balance out your capital gains thereby minimizing your tax liabilities. I may transfer more of my other funds into the Intelligent Portfolio, I will follow it this year and compare performance to see how it goes before crossing that bridge.
Awesome, enjoy and keep on keeping on!
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Old 04-18-2015, 02:44 PM
 
29,782 posts, read 34,880,403 times
Reputation: 11705
Quote:
Originally Posted by AnywhereElse View Post
Nothing compares to the feeling of being debt-free! Nothing!
Would your rather have 40k income no portfolio and no debt or 150K income 100k mortgage debt and 1.5 million invested?
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Old 04-18-2015, 02:46 PM
 
12,708 posts, read 9,981,349 times
Reputation: 9515
Quote:
Originally Posted by boater1 View Post
Suggest you keep the mortgage
But if you have the cash to pay it off, put the amount you would use to pay the mortgage off in a safe bank acct. Money mutual fund.

Pay the mortgage every month from there, even have it auto-withdrawn, maybe you could be a lower rate.

Leave that acct and payments on auto-pilot
On your taxes, take the interest deduction

This way, you will also have that cash available for emergencies.
keep options open, don't become house rich and cash poor.
As time goes by, you are paying down the mortgage and anytime you wish, just write a check and pay it off.
You need a large six-figure pot of cash for emergencies? Maybe you shouldn't go without health insurance.
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Old 04-18-2015, 02:50 PM
 
Location: Loudon, TN
5,790 posts, read 4,843,885 times
Reputation: 19489
Quote:
Originally Posted by TuborgP View Post
Would your rather have 40k income no portfolio and no debt or 150K income 100k mortgage debt and 1.5 million invested?
I'll take door number 2 Bob!
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