Investing 102

[Sieg]

Originally Posted by LS1-IROC

Thanks for the pep talk guys...

I know of a few people who were in the same situation as I am, and they cut bait and walked away from their mortgages. I wasn't about to do that because I view it as a commitment.

Figure out how you can best leverage your current situation. I gave away my first house and more in a divorce and it was a major setback but one you can definitely overcome.

[Bucketlist2012]

Originally Posted by LS1-IROC

Thanks for the pep talk guys...

I know of a few people who were in the same situation as I am, and they cut bait and walked away from their mortgages. I wasn't about to do that because I view it as a commitment.

Pep talks anytime.. Also do what is best for you and your family...

[GregWeld]

Originally Posted by LS1-IROC

Thanks for the pep talk guys...

I know of a few people who were in the same situation as I am, and they cut bait and walked away from their mortgages. I wasn't about to do that because I view it as a commitment.

We bought a 3 bedroom condo in Tempe for our son to live in while at ASU -- figured "why pay rent for 4 years" -- we should be able to get a couple roommates and sell this place for what we paid for it and at least break even...

WRONG -- #1 the girlfriend moved in for the 'summer' between sophomore and junior year - and never left - so NO RENT -- good news is his GPA went up a full point so we figured it was worth it!

He graduates and Adrienne transfers down there to the warmth.... okay now we have another 3 years before we need to sell the dump... WRONG she moves out to a house with AJ (boyfriend).... so I just spent 10 grand on rehab to get it pristine and ready to sell... for ----- Drum roll -----

100K if I'm lucky --- on a 307K purchase price.

We own it outright -- so it's just a loss pure and simple. Oh well.... But even if we had a mortgage -- I'd just be making the payments and sucking up the loss.... because that is the RIGHT THING TO DO. I bought it - I own it - it is what it is.

Anyone need a beautiful 3 bedroom - 2 full garage - condo in Tempe? Just off the 101 on E. Broadway. I'm going to list it with Bob Reams wife Bev who is an agent there. He owns Imagine Injection where I get all my stuff from... a super - better than super - guy.

[GregWeld]

Originally Posted by bdahlg68

I'm having fun owning (FUN). Cedar Fair, L.P. Just picked up some this year as the dividend has finally started bouncing back. Great yield with still potential for growth. They will be announcing FY2011 earnings in a few weeks will show if the high yield is going to stick around. Anyone else looking at this one as a "best of breed" ???

While it's not the type of stock "I" would buy -- because I tend to go for large national well known stocks in industries that I know and understand -- that doesn't mean there aren't compelling stocks out there that should be ignored. If I had a park here that I knew about and or all my friends were going to etc -- then I'd be more likely to "understand and know" their business.

I subscribe to Seeking Alpha --- and today they have a piece about Cedar Fair (FUN)... so here's a link.


Note please -- the author owns the shares -- and when I see that... I perk up because is the article written with a self interest? Or... I'm not saying this to sling arrows -- I'm saying this as "investing 102" -- pay attention to the little things like this and then go google or bing or whatever and do MORE research.

http://seekingalpha.com/article/3401...g_income&ifp=0

[Bucketlist2012]

Originally Posted by GregWeld

We bought a 3 bedroom condo in Tempe for our son to live in while at ASU -- figured "why pay rent for 4 years" -- we should be able to get a couple roommates and sell this place for what we paid for it and at least break even...

WRONG -- #1 the girlfriend moved in for the 'summer' between sophomore and junior year - and never left - so NO RENT -- good news is his GPA went up a full point so we figured it was worth it!

He graduates and Adrienne transfers down there to the warmth.... okay now we have another 3 years before we need to sell the dump... WRONG she moves out to a house with AJ (boyfriend).... so I just spent 10 grand on rehab to get it pristine and ready to sell... for ----- Drum roll -----

100K if I'm lucky --- on a 307K purchase price.

We own it outright -- so it's just a loss pure and simple. Oh well.... But even if we had a mortgage -- I'd just be making the payments and sucking up the loss.... because that is the RIGHT THING TO DO. I bought it - I own it - it is what it is.

Anyone need a beautiful 3 bedroom - 2 full garage - condo in Tempe? Just off the 101 on E. Broadway. I'm going to list it with Bob Reams wife Bev who is an agent there. He owns Imagine Injection where I get all my stuff from... a super - better than super - guy.

Ouch.. But thanks for sharing..

I have the Sister in law...I gave a car to...Wasn't good enough...i gave them a subscription to Kiplinger's....Waste of Time...

They trade the car for a car with payments... They go to Europe.....The Son Buys a BMW.....THEY WALK AWAY FROM THEIR HOUSE.....

Then they ask me to co sign on something...LOL... Never, ever...

They are bouncing from rental to rental.....Talking about Europe again...

WTF... I have given up.. No advise, no help. They play the Guilt card..."what do we do, live in the street ?".

Stop buying all the toys,and cras, and private schools for your kids...And maybe some of them should get a Job.

My wife and I over coffee this morning were talking about it, so we can get it out , and move on with our Day. Other family have Investments and wait for it......MAXED out Credit Cards ???

They know not to come to me for money ever again... In fact they are dreaming of Inheritances that they may never get...i know some wish me dead...No lie..Straw that broke this rich camel..

Little do they know , I was at my Trust attorney for a unscheduled meeting yesterday...I have had enough. i am about to cahnge my Trust to give more to the no kill shelters.

Sorry for the Ranting 102 My wife and I have anger issues today.. The entitlement train has come to a Stop... I am conducting this Train, and they really made me mad now..

[Fluid Power]

Originally Posted by GregWeld

We bought a 3 bedroom condo in Tempe for our son to live in while at ASU -- figured "why pay rent for 4 years" -- we should be able to get a couple roommates and sell this place for what we paid for it and at least break even...

WRONG -- #1 the girlfriend moved in for the 'summer' between sophomore and junior year - and never left - so NO RENT -- good news is his GPA went up a full point so we figured it was worth it!

He graduates and Adrienne transfers down there to the warmth.... okay now we have another 3 years before we need to sell the dump... WRONG she moves out to a house with AJ (boyfriend).... so I just spent 10 grand on rehab to get it pristine and ready to sell... for ----- Drum roll -----

100K if I'm lucky --- on a 307K purchase price.

We own it outright -- so it's just a loss pure and simple. Oh well.... But even if we had a mortgage -- I'd just be making the payments and sucking up the loss.... because that is the RIGHT THING TO DO. I bought it - I own it - it is what it is.

Anyone need a beautiful 3 bedroom - 2 full garage - condo in Tempe? Just off the 101 on E. Broadway. I'm going to list it with Bob Reams wife Bev who is an agent there. He owns Imagine Injection where I get all my stuff from... a super - better than super - guy.

Greg,

Why not rent it and play landlord for a while? Just curious...

Darren

[GregWeld]

The "market" has me thinking today -- and I thought about this thread vs the market and what people have done since say -- December. I want to reiterate that the way this market is going -- everyone is feeling pretty good... we're doing two steps forward and only one step back -- so the "gains" have been hot to say the least.

What I want people to remember is that this isn't "normal". We have outsized gains since the first of the year... and while I love this type of market -- don't get yourselves into a complacent position like we did our housing market - where it just went up and up and everyone was "loving life" and feeling invincible.

When - not if - the market turns against us for some period of time - those dividends keep on paying out... and it's those dividends that will hold you over until a down market turns up again. I'm not predicting a move - I don't think like that - I don't play the "I better take my gains and run" game... that's a losing game - that's "market timing" and trust me - you'll lose that game. What you want to really do - if possible - is to scale into your positions - build some more powder up (cash) and be on the sidelines ready to pick away at your favorite positions. Also remember that when the share price goes down -- your dividend payment will buy MORE shares... and then when the market comes back -- you have a larger gain % wise.

[GregWeld]

Originally Posted by Fluid Power

Greg,

Why not rent it and play landlord for a while? Just curious...

Darren

Great question -- and I hope I don't come off as sounding arrogant or like a smart ass with my response.

#1 -- I don't need the money so I'm okay taking the capital hit.

#2 -- I live in Seattle - this place is a zillion miles away in Phoenix

#3 -- Running the numbers - the rent is $1250 (other 3 bdrms there) so after I pay $250 month HOA - Insurance - Property taxes etc - Utilities etc... my net might be $700 a month or less. Less if I hire a "professional" property manager cause they take their share. $700 a month to me is about like most people picking up a dollar... it just isn't the kind of money I think about.

Now -- IF I had a mortgage - and needed to cover "most" of it -- and didn't want to ruin my credit by walking away (or doing the morally correct thing of actually paying my bills)... then that would be one thing... and especially if I thought the market might come back within the next 3 to 5 years. Remember that the market would have to TRIPLE for me to get my money to break even - and then if you calculate time money line -- I'd own the dump for 10 years and still probably take a capital loss.

If I sell it for 100K --- net -- I can invest that and MAKE 5K per year tax free in Muni bonds and have absolutely no worries or hassles.... like when the renter fails to pay or pays late - or goes bankrupt and it takes me 6 months to evict - or runs off after trashing the place.... and it costs me everything I "made" for the year plus to rehab it (again).

So for me -- I'm not in a positon to have to cover my arse... I'm in a position to just be able to make decisions on what I "want to do" not what I should or could do.

It's why our boat was called "Options".... everyone thought I was a stock trader -- but it was really because the boat was just another "option" for how we wanted to spend our time. If I was a trader - and the boat named Options -- I'd have named the dingy 'Puts and Calls".

[Flash68]

I check into this thread from time to time. I think it's a great one and glad it has legs.

I just want to comment quickly that I completely disagree on the matter of strategic default. I have encouraged several friends to do it in recent years (some have). I got out of RE in 2007. Yes, I saw the crash coming. I am close to getting back in.

Regarding this strategic fault matter..... It is a financial and business transaction, not a moral one, IMO. I read this little paragraph recently and it sums up my thoughts nicely:

--------------
"Strategic default has been portrayed as immoral by lenders. This is wrong. Lenders were immoral when they abdicated their responsibility to sound lending practices that ensured their borrowers could remain solvent. It is outrageous after such irresponsible lender behavior that lenders have the nerve to chastise borrowers for being immoral when borrowers fail to repay their debts."
--------------

It's a 2 way street. Don't "sell" or finance an asset-backed/collateralized asset if you aren't willing to take it back.


Greg, again, great thread and it's obvious this is helping many here either directly with data, or indirectly, with the motivation and stimulation to get working on investments and retirements.

[GregWeld]

Some people work that way -- I never have - never will.

I had a mortgage on the place when I bought it (Tempe place) but paid it off... it was at 6+%... and I don't like to make payments. Regardless of that it is still my obligation - not anyone else's, I don't care what anyone else says.