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Old 10-06-2007, 01:29 PM   #21
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[QUOTE=Philip;160162]disagree. Take the writeoff and pay the interest, it's low anyway.[/QUOT
Take two loans both at the same interest rate @ 30 years. One person pays it off in half the time and one goes to term paying that "low interest rate" and who pays more? The interest is HUGE at the end of the term. After it's paid off you can easily find other tax shelters that will make money for you.
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Old 10-06-2007, 01:35 PM   #22
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I invest with Sharebuilder.com and T. Rowe Price, neither of them require a $5000 minimum like others do and Sharebuilder allows the purchase of partial shares. That was a feature I liked the most because when I get a raise I usually just sink the difference into a new account.
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Old 10-06-2007, 02:58 PM   #23
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[QUOTE=socal pat;160177]
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Originally Posted by Philip View Post
disagree. Take the writeoff and pay the interest, it's low anyway.[/QUOT
Take two loans both at the same interest rate @ 30 years. One person pays it off in half the time and one goes to term paying that "low interest rate" and who pays more? The interest is HUGE at the end of the term. After it's paid off you can easily find other tax shelters that will make money for you.
Paying off a mortgage early is only good advice for poor investors. The person that goes to term isn't going to NOT invest the money he saves by not paying it off early. He's going to invest it elsewhere. And while the guy who pays early is locked at his mortgage rate of 6.5% interest for 20 years for paying it off, the other guy is making better returns elsewhere, is writing off part of the interest, and doesn't have all of his equity tied up where he can't access it (in a house vs liquid assets). Then he'll have to take a home equity loan at much higher than his interest just to access the equity in his house.

I posted this in a previous thread, and given that mortgage rates are still ridiculously low, it's still a good read.

http://www.ricedelman.com/cs/educati...?articleId=232

Frank
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Old 10-06-2007, 03:58 PM   #24
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I love "internet experts"
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Old 10-06-2007, 05:19 PM   #25
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[QUOTE=fmowry;160204]
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Originally Posted by socal pat View Post
\ Then he'll have to take a home equity loan at much higher than his interest just to access the equity in his house.

I posted this in a previous thread, and given that mortgage rates are still ridiculously low, it's still a good read.

http://www.ricedelman.com/cs/educati...?articleId=232

Frank
Yes, that may be but the interest on your equity line is TAX DEDUCTIBLE! WOOOWEEEWOOOO! I wouldn't pay off my mortgage early unless I was about to retire.
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Old 10-06-2007, 05:48 PM   #26
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Dear god I hope I don't have to deal with this stuff when I'm older...
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Old 10-06-2007, 08:02 PM   #27
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Dear god I hope I don't have to deal with this stuff when I'm older...
There's always the lottery or an early death.

It's really not that bad. Sign up for a 401k or a Roth and stick everything into the S&P then don't worry about it again until your 60.
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Old 10-06-2007, 08:13 PM   #28
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There's always the lottery

talk about the worst investment ever...
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Old 10-07-2007, 07:38 AM   #29
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There's always the lottery or an early death.

It's really not that bad. Sign up for a 401k or a Roth and stick everything into the S&P then don't worry about it again until your 60.
Sticking everything into one fund is a horrendously bad idea. At my work our retirement is fund based, five different funds. Among them are International (European/Asian), S & P, Government (who I work for), and a couple of others I just don't bother with because of hte shitty rate of return. I bought into the International just after the Iraq war was "over" (read: we got Saddam) at $7 or so a share. I think it's sitting at $22 a share now and I more than tripled my money by playing that. The government fund is basically paying my own paycheck and them paying me the interest back, shitty rate of return, but very stable. As we get closer to retirement most people start migrating money over to the Government fund.
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Old 10-07-2007, 04:23 PM   #30
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Firedog, I disagree. I'm trying not to scare the guy and you have to start somewhere. The S&P has averaged 10% for the last 70 years. You have to admit, if Bryceness did exactly what I said, short of another Great Depression, he'd retire comfortably at 65. A "horrendously bad idea" is doing nothing.

Fmowry, everything in that article makes sense but I can't quite do it. I move every 5-7 years and that means I have to start over paying 99% interest and 1% principal. Add in real estate agent commissions and I'd never pay off my house. I know that doesn't really change the facts in your article but I just don't have the ***** for it. We had a guy here quit after 8 months because he was upside down on his house in Las Vegas and couldn't sell it.
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Old 10-07-2007, 05:11 PM   #31
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Yah this is sounding like a debate on the power forum over at Mnet. We all have different needs. Some of us have pension plans and some will have to provide their own. Some can barely make a mortgage payment while others are looking for ways to hide all their extra income.
I hope Bryceness will listen to arga and start doing something, anything right now. $100 a month ..... anything. I guess I am one of the "poor folks" who are relegated to just paying off the house. I am, after all, just a school custodian. My home and 3 cars are paid for and when I retire in 7 years I should have $300-$400 k in the bank(various funds). This in and of itself won't take me on world cruises, but since both my wife and I also will have pensions and no debt it should make a decent buffer.
Some may feel uncomfortable unless they have millions set aside and that's great...... for them. One thing we can all agree on is that refinancing and pulling equity out of your home to buy **** that will end up in a landfill like cars and TVs is just what "they" want you to do. And signing up gleefuly for credit card with a 19% rate???? ****!!! never again.
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Old 10-07-2007, 05:44 PM   #32
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Quote:
Originally Posted by firedog25 View Post
Sticking everything into one fund is a horrendously bad idea. At my work our retirement is fund based, five different funds. Among them are International (European/Asian), S & P, Government (who I work for), and a couple of others I just don't bother with because of hte shitty rate of return. I bought into the International just after the Iraq war was "over" (read: we got Saddam) at $7 or so a share. I think it's sitting at $22 a share now and I more than tripled my money by playing that. The government fund is basically paying my own paycheck and them paying me the interest back, shitty rate of return, but very stable. As we get closer to retirement most people start migrating money over to the Government fund.
the S&P isn't a fund. it's an index. a committee picks some large caps as a representative sample of the market and the share proportions are weighted to accurately represent the size of each.

there's an easy way to invest in long term investments. read the ratings. pick the one that's the best return rating and lowest risk.

but look around, there's very few funds that outperform the S&P 500 over the long term.
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Old 10-07-2007, 08:22 PM   #33
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but look around, there's very few funds that outperform the S&P 500 over the long term.
There has never been a fund that outperforms the S&P over the long term. Do I have any real documentation of this? No. But, if any fund ever returned more than the S&P over the long term (say 15 years) you would see an ad for it boasting about this every 5 minutes on TV and there would be lines of people trying to get into it. For this reason, ETF's are the perfect investment if you are looking at a long enough window. If your window is short then you are gambling, not investing.

What do I invest my ROTH money in? A mutual fund that does 2X the S&P.

What have a got burned in? Investing in individual stocks and trying to short the market. It took me 20 years to learn to just stick the money in the S&P and let it grow.
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Old 10-07-2007, 10:36 PM   #34
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what is a s&p?
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Old 10-07-2007, 10:50 PM   #35
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Standard and Poor's index of the top 500 companies. By investing in a S&P fund you are buying stock in these companies. It's more complicated than that. Y8S goes into it a little in his post. The index is weighted per segment and in reality your mutual fund manager will buy a subset of those stocks to try to match their performance but saying it's the top 500 companies is close enough.
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Old 10-09-2007, 11:10 PM   #36
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Don't forget, investment strategy changes dependant upon age!

Simple advice - eliminate debt ASAP and diversify between long-term and short term growth.

If you are looking for something more detailed, do continual research. - It's your money, know what it is doing for you.

- L

PS - And if you are bordering on panic due to an impending collapse of the US economy, check out www.cabelas.com and order hand-loading supplies...
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Old 10-09-2007, 11:42 PM   #37
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......
PS - And if you are bordering on panic due to an impending collapse of the US economy, check out www.cabelas.com and order hand-loading supplies...

......Hahaha...Just waiting for the Zombie uprising and my retierment plan comes outta my trunk locked an loaded.....but If the economy crash's I guess i can settle with living targets.
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