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This is true, but whether or not one pays off a small mortgage or a large mortgage, there is still something to be said about living “rent free.” We moved to an area with fairly low property taxes compared to where we came from. This move meant buying a new house so a 30-40 year old mortgage was not a factor. However the “inflation” in the old house created the wealth to pay cash for the new ones. Paying cash was a personal choice, I don’t think anyone can say it is right or wrong. We also “cut” the cable bill, and the utilities are considerably less than where we came from so overall carrying costs are quite low. That being said, things always change and I’m sure the craziness that made the col in old place skyrocket will inevitably creep its way here.
Either way I don’t consider it living rent free ....just different costs .. whether I owned , rented or had a mortgage some entity is always getting paid.. it Is just a question of who’s money is funding the place I live ...no mortgage is my money tied up , with a mortgage the banks money is funding it or renting, my landlord used his money so I have a place to live....either way I am paying someone ...at this stage I like renting , as others pay me more for the use of my money then I pay the landlord for the use of his money
Either way I don’t consider it living rent free ....just different costs .. whether I owned , rented or had a mortgage some entity is always getting paid.. it Is just a question of who’s money is funding the place I live ...no mortgage is my money tied up , with a mortgage the banks money is funding it or renting, my landlord used his money so I have a place to live....either way I am paying someone ...at this stage I like renting , as others pay me more for the use of my money then I pay the landlord for the use of his money
But you are millionaire Mathjak. What you are doing in your situation makes sense. For lower and middle income people, most of whom are not financially savvy - the better way is to buy a small house, eliminate PMI as quickly as possible, and pay off the mortgage as quickly as possible.
But you are millionaire Mathjak. What you are doing in your situation makes sense. For lower and middle income people, most of whom are not financially savvy - the better way is to buy a small house, eliminate PMI as quickly as possible, and pay off the mortgage as quickly as possible.
No , it was the fact I made efficient use of my money that grew wealth ...I did not have a pot to pee in going in to life ....so I bought a co-op as a first step , then a house , then investment property ,and expanded from there.
It wasn’t until about 15 years ago that we rented and sold the house and bought what amounted to a very lucrative real estate business with the money no longer in the house .
Different resources , different plan and strategy at different times.
That is the difference between those who grow decent amounts of wealth . They think outside the box and change as the big picture changes. Especially changing views as time and situations change.
Doing the same ole same ole usually requires a stroke of luck to grow exceptional wealth rather than as a plan , a goal and a strategy and luck all working together
Last edited by mathjak107; 12-30-2019 at 05:55 AM..
No , it was the fact I made efficient use of my money that grew wealth ...I did not have a pot to pee in going in to life ....so I bought a co-op as a first step , then a house , then investment property ,and expanded from there.
It wasn’t until about 15 years ago that we rented and sold the house and bought what amounted to a very lucrative real estate business with the money no longer in the house .
Different resources , different plan and strategy at different times.
That is the difference between those who grow decent amounts of wealth . They think outside the box and change as the big picture changes. Especially changing views as time and situations change.
Doing the same ole same ole usually requires a stroke of luck to grow exceptional wealth rather than as a plan , a goal and a strategy and luck all working together
Again, people that are below the median of income aren't going to be able to think outside the box, and there's the problem. The extra money that you were able to put into investing, would probably be spent on meaningless crap by most people, leaving them in worse shape than they were before.
Again, people that are below the median of income aren't going to be able to think outside the box, and there's the problem. The extra money that you were able to put into investing, would probably be spent on meaningless crap by most people, leaving them in worse shape than they were before.
Then no money at any point in their lives equals no other choices....but that has nothing to do with your comment about “well you are a millionaire “ ...no , I had nothing like everyone else ...I just worked at finding a way to start the process of finding a way to grow wealth.
That is the difference between those who find a way and those who find an excuse and why most Americans will not attain that wealth
Again, people that are below the median of income aren't going to be able to think outside the box, and there's the problem.
My Dw and I were both Minimum-Wage laborers working full-time while carrying a full load of classes at UC-Fresno when we bought our first rental real estate.
We have never had salary income that was above the national 'median of income'.
Quote:
... The extra money that you were able to put into investing, would probably be spent on meaningless crap by most people, leaving them in worse shape than they were before.
I agree that most people spend their money on meaningless crap which leaves them in worse shape.
As an individual, you do not need to be wealthy to climb up a ladder.
Either way I don’t consider it living rent free ....just different costs .. whether I owned , rented or had a mortgage some entity is always getting paid.. it Is just a question of who’s money is funding the place I live ...no mortgage is my money tied up , with a mortgage the banks money is funding it or renting, my landlord used his money so I have a place to live....either way I am paying someone ...at this stage I like renting , as others pay me more for the use of my money then I pay the landlord for the use of his money
While I agree with you in theory, the reality is quite different. Yes, there are costs associated with owning a home which you could equate to rent. However, our carrying costs on two homes are less than half of my husband’s ss check. We could technically rent a place for the same amount, but it would be nothing like where we live. We could rent out one of our homes today for over $5k per month if we chose to. Our total costs for both homes come nowhere even close to that and I, personally, have never wanted to deal with being a landlord. The money used to purchase the homes isn’t making us money in the stock market, but as I stated in my earlier post, we don’t “need” any more money and what we do have invested is multiplying like crazy, along with the value of our assets (homes) which have also appreciated considerably. If everything were to crash tomorrow and go to zero, we still would have two great homes which we could afford with one ss check. We could always liquidate one if we needed to also. Again, like I stated before, I don’t think it’s a right or wrong answer, just a choice on how to diversify our investments.
We still owe ~$90K on our Mortgage, but those funds which we borrowed at 3-1/2% are invested and earning well over 8% in income! My wife and I are both comfortable with this amount of 'leveraging' in our portfolio so we have decided to not pay off the Mortgage early, although we easily could.
A Paid Off Mortgage is a personal investment choice for many of us approaching retirement, NOT necessarily a sign of affluence.
Location: Formerly Pleasanton Ca, now in Marietta Ga
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Quote:
Originally Posted by Movn-on
This is true, but whether or not one pays off a small mortgage or a large mortgage, there is still something to be said about living “rent free.” We moved to an area with fairly low property taxes compared to where we came from. This move meant buying a new house so a 30-40 year old mortgage was not a factor. However the “inflation” in the old house created the wealth to pay cash for the new ones. Paying cash was a personal choice, I don’t think anyone can say it is right or wrong. We also “cut” the cable bill, and the utilities are considerably less than where we came from so overall carrying costs are quite low. That being said, things always change and I’m sure the craziness that made the col in old place skyrocket will inevitably creep its way here.
But living rent free could be to keep the mortgage and invest the money where the return pays the payments and even more.
In both cases the money is not coming out of your pocket for the rent or mortgage.
But living rent free could be to keep the mortgage and invest the money where the return pays the payments and even more.
In both cases the money is not coming out of your pocket for the rent or mortgage.
Many don’t get this concept
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