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View Poll Results: Mortgage or Investments
No mortgage pay 350k for house 34 48.57%
Mortgage with money in investments 36 51.43%
Voters: 70. You may not vote on this poll

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Old 07-25-2019, 04:50 PM
 
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We do too but it still requires a trip to an atm or bank
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Old 07-25-2019, 04:51 PM
 
Location: SoCal
13,419 posts, read 6,417,350 times
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Quote:
Originally Posted by mathjak107 View Post
Well you must be getting cash from somewhere .. I know my bank does not deliver
I don’t have to use cash, but my husband gets a few hundreds to keep in his wallet. But when he is older like in his 90s, I doubt that he will use any cash. We use the cash for the farmers market, some don’t take credit cards.
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Old 07-25-2019, 04:52 PM
 
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Quote:
Originally Posted by NewbieHere View Post
I donít have to use cash, but my husband gets a few hundreds to keep in his wallet. But when he is older like in his 90s, I doubt that he will use any cash. We use the cash for the farmers market, some donít take credit cards.
You sound just like us.
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Old 07-25-2019, 08:52 PM
 
Location: Central CT, sometimes NH.
3,502 posts, read 5,161,346 times
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I like having a primary residence fully paid for. It is not a significant % of my net worth. There is a certain level of smugness among some investors since 2008. The overall market return has been decreasing and will continue to do so as risk-free rates approach zero or negative in real terms.

I am concerned about the volume of money invested in the market from 401k, 403b, 457 and others. Too many people are depending on the market returning a rate that substantially beats inflation while being capable of sustaining a growing amount of investment dollars. In many cases the people investing are just indexing the SP500 or using a target retirement fund. The "market" as we know it is still based on basically the same group of 2500 stocks. It is conceivable that at some point this golden goose of 2500 will not be able to sustain everyone's retirement needs especially when there a few stocks that skew the market and are very heavy contributors to the growth we see. Do we really think that Amazon, Google, Netflix, Facebook, Apple and others are going to be the driving forces that fulfill our needs and wants forever and carry the market?

For these reasons I feel that having the security of a paid-for place to live is an important objective for my personal peace of mind.
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Old 07-25-2019, 10:00 PM
 
6,343 posts, read 4,777,318 times
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The nice thing about having the money invested instead of tied up in the house is that I win either way. If investments continue at anywhere near historical rates of return, I will continue to add to the $100K I have already made. If investments do poorly for a long period of time and returns will not cover the mortgage payments, I can always cash out of my investments, pay the mortgage and will still be ahead by the $100K and whatever I make before that happens.

Personally I don't see any level of smugness since 2008. Most investors remain cautious and pull back at the first sign of trouble. Anyway you feelings agree with the majority who either do not know how to invest or are too worried to try.
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Old Yesterday, 01:07 AM
 
Location: We_tside PNW (Columbia Gorge) / CO / SA TX / Thailand
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Mortgage in retirement for me, as I use the equity to buy commercial RE (since 2008, (actually since 1980) the banks are on my black list). Banks can CALL your commercial paper anytime they like. Personal mortgage, they cannot call and demand immediate payment.

I have the cash to pay off if needed
I have a few other homes paid off already (investments) in case I need a place to live.
VERY cheap money (Home mortgage)
I keep 4+ lines of credit which any could pay off my house.
Flexibility... Mortgage frees up a lot of capital for other uses.
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Old Yesterday, 03:34 AM
 
72,069 posts, read 72,068,214 times
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Quote:
Originally Posted by jrkliny View Post
The nice thing about having the money invested instead of tied up in the house is that I win either way. If investments continue at anywhere near historical rates of return, I will continue to add to the $100K I have already made. If investments do poorly for a long period of time and returns will not cover the mortgage payments, I can always cash out of my investments, pay the mortgage and will still be ahead by the $100K and whatever I make before that happens.

Personally I don't see any level of smugness since 2008. Most investors remain cautious and pull back at the first sign of trouble. Anyway you feelings agree with the majority who either do not know how to invest or are too worried to try.
actually most investors who intend to pull back at the first sign of trouble are to late . the time to think about cutting back is at the highs before things fall .

there is no such thing as " at first sign of trouble " things just fall a bit from new highs and then we wait for it to bounce back , only it falls more , then more , then more and eventually you are in it for the ride .

the problem is no one knows when " trouble " is first appearing .

if you want to cut back -cut back as part of a strategy , not trying to time what you think is the " first sign of trouble " , otherwise you stay put and ride the cycle .


people ask all the time when a drop happens , should i sell ? no , the time to sell was when we were at the highs .. now the question should be do i buy or wait a bit longer for a bigger drop ?


this headline from 2007 reminds me of that fact .


Dow tops 14,000, hits record
Wall Street starts off fourth quarter with a bang, sending the blue-chip leader to all-time closing and intraday highs.
By Alexandra Twin, CNNMoney.com senior writer
October 1 2007: 5:56 PM EDT
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NEW YORK (CNNMoney.com) -- Stocks rallied Monday, with the Dow closing at an all-time high on bets that the big banks are starting to put the worst behind them - and on hopes that the Federal Reserve will continue cutting interest rates.
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
The Dow Jones industrial average (Charts) added nearly 192 points to end at an all-time high of 14,087.55. Earlier in the session, the Dow had hit 14,115.51, a new record intraday high. The previous intraday high was 14,021.95 from July 19.


The tech-fueled Nasdaq composite (Charts) gained 1.5 percent and carved out a new 2007 record, closing at its highest point since Feb. 2001.
The broader S&P 500 (Charts) index climbed 1.3 percent. The Russell 2000 (Charts) small-cap index jumped 2.4 percent.
"You're seeing a continuation of the recent momentum," said Chris Johnson, CEO of Johnson Research Group.
"It becomes a psychological phenomenon," he said. "Investors know that there are inherent risks in the market, but at the same time, they're rationalizing any bad news."

Wall Street was also perhaps betting that any so-called "bad news," whether it be weak bank earnings or a dip in the ISM index, means the Fed is more likely to cut interest rates again at its next policy meeting at the end of the month.
Tuesday brings the August pending home sales report in the morning.
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Old Yesterday, 04:45 AM
 
Location: The Triad (NC)
28,588 posts, read 62,404,839 times
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Quote:
Originally Posted by Lincolnian View Post
I like having a primary residence fully paid for. (IF) It is not a significant % of my net worth.
That's the main key to doing it successfully ... eg: Target 10% but nte 25% of Net Worth.
The next set of questions are the annual own & use costs vs income... eg: Target less but nte 25% of Net Income.
If you can keep BOTH low you're golden.

Last edited by MrRational; Yesterday at 04:58 AM..
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Old Yesterday, 05:19 AM
 
Location: Central CT, sometimes NH.
3,502 posts, read 5,161,346 times
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Quote:
Originally Posted by MrRational View Post
That's the main key to doing it successfully ... eg: Target 10% but nte 25% of Net Worth.
The next set of questions are the annual own & use costs vs income... eg: Target less but nte 25% of Net Income.
If you can keep BOTH low you're golden.
Yes, annual ownership costs are low. We couldn't rent a 1 bedroom apartment in the area for what we pay in costs. We live significantly below our means and save more than we spend so carrying a mortgage to have more money to put in the market is unnecessary.
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Old Yesterday, 05:39 AM
 
Location: The Triad (NC)
28,588 posts, read 62,404,839 times
Reputation: 32383
Quote:
Originally Posted by Lincolnian View Post
Yes, annual ownership costs are low.
Good for you. For too many though ... every cost won't get included in that statement.

No mortgage but we still have property taxes (CT? !!!) and insurance. Right?
But we'll also have high(er) utility bills in the house and in retirement we'll have
all manner of 'helper' expenses like fall leaves and winter snow and summer lawns.

If we're obliged (or choose) to pay $X in order to live there be sure it's all included.
For many suburban home owners these own & use costs can add up to a fair bit.
Setting aside the opportunity cost of the equity cash tied up in the home these own & use costs alone
will often be as much or even more than the rent etc for most downsized home options
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