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Total debt is really a non-issue for me. I assume that people and corporations generally use debt responsible.
Dream on...
Quote:
Originally Posted by Malloric
The people that don't use it responsibly generally have so little debt that it's fairly trivial (your payday loan and buy here, pay here used car lot crowd).
Generally businesses and individuals use debt for non-current consumption. Government is more mixed. Using debt to finance an infrastructure project might make sense. Using debt to finance welfare, not so much. Wars are a more mixed bag. I have no issue with using debt to finance WWII. Afghan/Iraq wars were more the opposite for me. They were, by and large, unproductive and unnecessary.
First of all, needing two incomes to pay the mortgage is a risky prospect, especially for those who have or intend to have children; second, even doubling the income you are still at a stretch.
Median HH income and dual earning HH income isn't the same thing and certainly in now way shows you would need both incomes to pay a mortgage
- The National Debt is over $18 trillion and is guaranteed to go to at least $20 trillion before there's any chance of having a balanced budget bring in surpluses to pay it down. The $18 trillion is UP over $3 trillion since 2012.
- The Total US Debt is $59.2 trillion which is UP over $4 trillion since 2012.
- All forms of Consumer debt are UP since 2012.
The country runs on DEBT now, there's no paying off the DEBT as paying off DEBT would fundamentally harm the fundamentals of the Economy.
Sure, but a low single income does prove that you'd need both incomes.
A low single income means no vacations either. A low single income doesn't mean you can't buy a house either so I'm still lost at why you are stuck on new median
The truth is there isnt a huge depreciation in a house just because it's "used" and it's the used home values that actually support and drive the new home values. If I'm a builder I'd rather build in an area where prices are advancing vs stagnant. I'd also rather not build where houses were selling for 50k. The distribution of new houses being built is distorted even when looking at median price
A house is just not a good investment for the most part for Generation Y due to the status of our Economy. We don't have a lot of job stability which has us needing to be MOBILE to move across the country in 5 years if need be for a new job in a new market in probably a new industry. If we were back in the Baby Boomer days of working in one plant, in one city, for one company for 25 years and retiring with a Pension....then maybe a House would make sense.
I hope nobody actually follows your advice. Because this is a dandy way to stay poor.
Renting is a zero percent ROI. As long as the homeowner can avoid a negative ROI (which isn't at all difficult), the buyer always comes out ahead of the renter.
Looking at shelter as a fixed cost is shooting oneself in the foot, financially. Anyone with any financial sense at all can easily get to the point where the only annual expenses are taxes, maintenance and insurance. In my case, that's a few thousand per year. Sure beats renting. If I were to rent the house that I own, it would cost around $30K per year. The free-and-clear owner pays about 10% compared to the renter.
Even if I were bouncing around every five years, it would cost less to buy-sell-move-buy than rent-rent-rent.
Again, not a big deal. My car loan is at 0%. I don't have any real pressing interest in a new one, but rolling over negative equity isn't a real concern. It would be a factor reducing the amount I'd be willing to spend on a new car is all. Taxes are probably the bigger reason I'd avoid buying a new car than being upside down as I don't really think I'm THAT upside down.
Majority of student loans are in good standing a small pool (12% of students) accounting for half of defaults. Clearly there's a problem with for-profit schools. The other 88% of borrowers, however, seem to be borrowing responsibly.
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