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I hate being in debt. I just thought I'd throw that out there to begin. After my latest round of payments goes through I should be down to around $36K of debt. Ugh. That's a pretty daunting number, if you ask me, but it's manageable. And the first person to complain about their mortgage to me can blow me where the pampers is.
Anyway...
Given the continual downward trend of the stock markets, and the looming hyper-inflation once the $600B in loans from the Fed,$700B bailout from the government, and $250B in bank stock purchases by the government go through, I have decided to not bother putting anything over the minimum into my 401(k) for the time being. Chances are the dollar will completely tank over coming 6-8 months, in which case I will have much bigger things to worry about. Might as well pay off some debt and pour some money into hard assets while I can. If I live by the budget I have setup for myself, I can put about $1800-$2000 into my debt per month. Add in the couple grand I will get back from taxes and some money I have put away already and I should be able to get debt free in less than 18 months from now. Having done some calculations based on my spending habits, I only need ~$18K per year to spend on survival (ignoring loan payments). If I become debt free, my freedom jumps up dramatically, so that's what I'm to focus on from now on. Plan: become debt free, quite ITT, find a brewery with an opening, enjoy my life.
Oh, on the topic of moneys, if anyone has Boardwalk in the McDonald's Monopoly game, let me know: I have Park Place. We could split whatever's left of a cool million after taxes.
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2 comments:
Unless the mortgage holder is an absolute moron, I wouldn't call it a debt so much as an investment with maintenance. Those who play it smart can get a reasonable house within their affordable range (lower end of that range, preferably) and likely see it turn a profit over time. Even with the nose dive things took recently my house is still valued double what I mortgaged seven years ago (and that number is very manageable).
Well, honestly I'd like to see a detailed analysis of this with regards to the interest you pay (have you looked at the formula they use to calculate a mortgage payment? it's unreal) plus the effects of inflation during the course of the appreciation. Consider how the dollar has been devalued by 95% since the early part of the 1900s, and will be taking a nosedive once all the bailout money, bailout loans, nationalization of banks, and apparently some silly new stimulus check all get into the economy.
I'm actually kind of tempted to do an analysis of this. I'd be willing to believe that, outside an artificially inflated housing boom, a mortgage isn't nearly as good an investment as some people think. I have no solid basis for such an argument yet, but I might actually sit down to develop it further. God, I need more free time.
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