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A paid off house when rates are at 7 to 15% is smart.... but when they're under 4%... that would be just plain dumb.

We're at HISTORIC low mortgage rates.... and the rates of return on our investments should far out pace a FIXED mortgage. Think about this over a 10 / 15 / 30 year time frame.... surely our interest rates won't go down much from here... but they certainly could RISE from here.... So put yourself in a position to pay 4 and earn 8....

Quote:

Originally Posted by Bucketlist2012 (Post 429792)

As far as "Camaro needs", that is my only "Money Pit". With interior, and HP needs, and then 28 years old paint, I will never be done, and I will never get out what I put in..

You would think I would know better, but the need for my car is just too strong, and my Investment Brain gets cloudy.:cheers:

There is absolutely NOTHING WRONG with having some money for fun stuff...

It's just that many (most?) have too much fun and not enough savings/investments... The more you have invested and earning money - the more fun stuff you can afford!

Quote:

Originally Posted by GregWeld (Post 429793)

Just to compare, in Canada you can't really write off interest on your personal home only a portion of it if you use for home office etc. It's different tax wise than the US. I'd have to check specifics but it's a less common thing up here.

Edit I just looked it up:

Quote:

Canadian federal income tax does not allow a deduction from taxable income for interest on loans secured by the taxpayer's personal residence. But homes used in businesses as a landlord who owns a rental residential property can deduct interest as any other reasonable business expense. The difference being the deduction is allowed only when the property is not used for the taxpayer's personal use but is used as in any other type of business. However, there may be additional exclusions for passive activity losses.

The home ownership rate in Canada was about the same as in the United States in 2008, but Canadians have about 70% equity in their homes on average (i.e., 30% mortgage debt), compared to only 45% average home equity in the United States.

Quote:

Originally Posted by GregWeld (Post 429793)

Greg, that is my plan, and I am sticking to it. Some people would say , why would I take a 30 year loan, when I am 52 years old ? At 3.5%, why not ?

I can beat that long term easily. It took years for my Wife to get that, but she understands now. She wanted to throw more at the principal until I showed her the numbers.

So here's why it's DUMB DUMB DUMB to have a paid for house....

I just went and looked at the Schwab account I always reference here... (I hold back because I never really want you boneheads to know how much money I really have! :D )

That account spins off over 400,000 in dividends per year ----- AND ----- has a 10.34% capital gain (paper gain). There's over 7MM in that account... and it's on pace to return 1MM in cash and gain this year if things just hold where they are.

Now -- I realize that I have an "out sized" argument going here -- but the point is that no matter how much have invested or how much you owe -- if you manage your money correctly... you should have a gain on your house - a gain in your account - and you should be taking a tax deduction on your house which effectively reduces your percentage rate you're paying by the effective tax rate (4% mortgage - 30% tax bracket - your real rate is closer to 3%).... so if you're paying 3% effective rate -- and you're getting a 4% dividend and 7% growth on your investments.... you can see very quickly that there's nothing gained by paying off a mortgage.

:cheers:

You sir, need to buy a Ferrari or the new Lambo. To quote yourself, "There is absolutely NOTHING WRONG with having some money for fun stuff... " :D

Doooooo it!

Quote:

Originally Posted by WSSix (Post 429853)

You sir, need to buy a Ferrari or the new Lambo. To quote yourself, "There is absolutely NOTHING WRONG with having some money for fun stuff... " :D

Doooooo it!

Well let's see.... I already own:

Audi R8 Sypder
MB S63 AMG
Porsche Cayenne Turbo
'32 Ford Roadster
'37 Ford Roadster
'56 Nomad
'65 Mustang R Code clone track car

Is that not enough fun for one guy?

In May I was in Europe at the Monaco Grand Prix - in June I took the '32 Roadster to LA Roadsters show - I just got back from the Shelby Mini Nats @ Sonoma raceway...

How much fun can a guy have? I'm OLD... I need some rest.... :cheers: :D

Did the KO stock split just happen? I see my share price now shows as $19.70 instead of $78.79 is this a 4 way split or something meaning your # of shares is multiplied by 4 as the previous share value seems like it was divided by 4???

Quote:

Originally Posted by Rybar (Post 429979)

Yup it split. 2 for 1 though. Things may not look right until Monday.

I noticed KO has split just in case some of you are wondering about it being in the red this morning.