Searching "comments":
| # | Comment | Survey |
|---|---|---|
| 41 | Yes, but it's probably not good methodology and I don't know why anyone would... | Do you feel it is ok to use SC for school/work "research"? |
| 42 | No, I don't believe in your fairy tale. Devotees of religion are exempt from developing certain neurotic illnesses, Their belief in the universal neurosis spares them the task of developing their own. | Do you believe in being saved by Jesus Christ? |
| 43 | Not if it's copyrighted, no. | Should internet users be allowed to download music without paying for it? |
| 44 | Hadn't really thought about it yet. I imagine I'd raise them in a way that the issue would be implicitly addressed by the society in which I was living. | Do you/will you teach your children about safe sex and/or abstinence? |
| 45 | Hmm. I didn't buy the truck I own now. I think people who finance or lease don't have good financial sense. | When purchasing an automobile, what has your method of payment been? |
| 46 | Getting a loan to pay for something. | When purchasing an automobile, what has your method of payment been? |
| 47 | Biggles, thinking like that is why there is an upper class and a permanent middle/lower class. Banks have convinced you that you need their loans to get by in life. This is utter nonsense. It's flat-out human stupidity in action. Financing a condo to avoid having to pay rent on an apartment is a good decision, but realize it is the result of being stuck between a rock and a hard place. The financing of the condo is the lesser of two evils. Financing a house is just plain stupid. The proper method is to save money in advance to make large purchases... even houses. Saving for 10 years to buy a house at 6% return on investment compounded monthly will ultimately result in you living in a house that you fully own at the end of the ten year period-- the same would be accomplished by THIRTY YEARS of equal sized payments on a 7% mortgage. Anyone who finances a car is even more stupid, on the basis that everyone NEEDS somewhere to live, but a car is a luxury. Cars are pretty cheap. You can get a fiscally sound car-- reliable transportation-- for around $7,000 (anything less than that and the repairs make it un-savy... unless you do your own work in which case an old $3,000 chevy truck is probably suitable). Up until the point that an individual can afford to pay cash for the car, they should have no car at all. Ultimately they will benefit in two ways-- 1) During a time of poverty, they will be frugal by having no car expenses. 2) Later on, they will own the car out-right, thus preventing a perpetual state of poverty. Loans to go to school is an entirely different situation, so, I retreat from my original statement on this rare case. 1) School loans are subsidized by the government. Interest is diverted and lower than it normally would be-- often at or near inflation. 2) The financial benefit of attending college MAY outweigh the immediate harm done by taking the loan. (I'd advise American Philosophy Majors against using loans to go to a private college for $30K a year for 5 years, they would have been MUCH MUCH MUCH better getting a job straight out of high school. But in your case you are taking a much smaller loan for a much more lucrative professional outcome.) | When purchasing an automobile, what has your method of payment been? |
| 48 | The idea that most people would financially benefit from financing an expensive-as-possible personal residence is not one that I agree with. The associated costs of owning the home and keeping it in good repair make it the case that a person's best bet is to minimize the size of the residence that they live in. Investing the money may yield good or bad results in relation to the interest being paid on the loan, but the effects of up-keep on the house are going to out-weigh that. The way, IMO, to fudge the system, is to have renters and not report them to the IRS. It's a good way to get your feet off the ground, anyways. Of course, such a plan would entail it's own risks... | When purchasing an automobile, what has your method of payment been? |
| 49 | Also, you are assuming that the money is in long-term investments in order to avoid it being taxed. And even then you'd have to "Edge out" the loan rate of 7%-2.1%= 4.9% (with tax benefit) through the compounding of the long-term investment. So you have a long-term investment that is locked down and un-movable and you want to make, over the course of say 5 years, average annual interest on the original amount of 4.9%+.7%= 5.6% (after including capital gains on the 4.9 when the stock or whatever is ultimately sold...). We can assume that appreciation is 1% more than upkeep costs, so we can negate those factors and state that you can benefit if you gain 4.6% annually. Inflation is working both ways on the money in this case so it too can be negated. So, essentially, if you can earn slightly over 4.6% on an immovable five year investment, you can expect to *break even* on the whole fiasco. Seen any good bonds floating around at that rate? Sure, of course you have... but just for the pain in the ass of dealing with all this you'd probably want some sort of return... Once we throw in the profit, the risk/reward ratio is COMPLETELY out of whack. An 8% bond has very significant risk under these circumstances (5% annual default rate?) in exchange for an annual profit of only 3.4%. I.E., you lose 1.6% a year. The lemon-squeezing scenario occured here as a result of the fact that you assumed the risk of someone you are loaning money to defaulting on that loan, but you don't really "benefit" from the possibility that you may one day go bankrupt and not have to repay the mortgage loan, because your mortgage loan is secured and your bonds are not. The whole fiasco is whacked, IMO. And to further fudge the situation up, once you buy into the idea that this is effective you have to continue the scheme forever because you get raped if you ever decide to move into a less expensive house... which is particularly troublesome for old people who had 4 bedroom houses prior to all their children moving away and now can't sell them... Eek. Then again, if you can make 11% annually on a diversified stock portfolio that you don't touch, this might work... But the average man on the street doesn't make that much on his investments. This also assumes that all the money is available up-front to be invested if need be.. it doesn't assume someone would actually NEED the loan. For the person who needs the loan and can't try to beat-the-system under these circmstances, the smaller loan, the better. In summary, I don't think it's very often a good idea to take on a SECURED loan, so that you can issue other people UNSECURED loans... | When purchasing an automobile, what has your method of payment been? |
| 50 | Even mortgages are scams, Biggles. It's the system by which the rich get richer. Investments always produce a higher return than inflation, which creates two classes of people-- Those who loan, and slowly become wealthier. Those who are loaned to, and slowly become poorer. The system wasn't working fast enough for those of us who loan (I'm one of them), so we started to find more effective ways to scam you out of your money-- ultra-high rate short term loans, jewelry loans, credit cards, HA! Fudge it! FINANCE EVERYTHING! We know that people just can't put off for tomorrow what they want for today, so we take advantage of that fact. You are right that living in an apartment is of course a complete waste of money, but you make the situation seem dichotomous when it really isn't. The alternatives are purchasing a smaller house and then moving into a larger one when the smaller one is already bought, purchasing a house and having renters, or living with the folks for an extra year or two and saving a significant amount of money during that time. I'll agree, you are pretty much fudgeed if you don't have a good job, and you're going to have to take out a mortgage or a loan of some sort unless you have other resources at your disposal... but a sensible college graduate earning $30K a year, or someone who was in the millitary for a few years, shouldn't have trouble using my system. People generally pay somewhere between 6.5 and 8.5% interest on their mortgage (and I don't even want to get into the "fees" that they dealt with). Assuming they have 7% interest which is a fairly usual figure, they pay $665 a month on a thirty year mortgage for every $100,000 in loan. Or, that is to say, they pay about $240,000 for each $100,000 of house (there are inflation issues with these figures, but we can still say that for every $100,000 worth of house they buy on 30 year loan, they'll pay approximately 2 times that much.) So the idea that your parents would have been saving for "more like twenty years" isn't true unless they have a 40 year mortgage. I don't know, do they? Ideally, an unmarried individual with a reasonably good job would purchase a condo or a small house (on loan) and rent one of the rooms. This would allow them to put ALL of their money towards the principal on the loan, while at the same time allowing much of the interest to be paid by the renter (who is an idiot, but, they aren't hard to find), and also giving them somewhere to live in the mean-time. By the time they decide to move, they will have ALL THE MONEY THEY PUT INTO PAYMENTS BACK... essentially they got a free place to stay for a while AND they saved some money. So, the key for young people is to own and rent, and the key for married people is to have each owned and rented when they were young so they only need a 5 year mortgage by the time they move into a large home together and have kids. A five year mortgage is not necessarily a bad idea, because you'll only end up paying ~20%-~25% above the value of the property. Essentially, people are best advised to get very short loans on the cheapest possible properties they can stand, pay them until they own them, and then move up. In Amwerica this essentially means that the most fiscally sensible 22 Y/O's around live in trailer parks or condos in the ghetto. It'll work for them in the long-run though, trust me on that one :). There's of course more to the situation than this, though. The reality is that people NEVER pay off their mortgages. That's right! People NEVER PAY THEM OFF! The average person just keeps borrowing against the house. Over and over. They just keep re-issuing the loan. I look at my parents as a good example. They purchased a $250,000 house about 8 years ago when they had around that much in cold-hard cash floating around in their non-retirement bank accounts. The sensible thing would have been to just buy the house straight out. Instead, they borrowed $100,000 on the basis that they felt unhappy having no money in the bank. This of course is just an optical illusion, but they fell for it. They also fell for what I view as Romkeys corrupt logic that there is a way to financially benefit from a home loan. In this case, the following events occured-- They payed about 2,000 towards the loan for the first 3 years. My mom then quit her extremely good job and was stay-at-home for a while, during which time (1 year), only interest was payed on the loan. The 100,000 in cash they had had before was being invested. Just like Romkey is arguing, it was the 90's and they averaged about 30% return a year (including 110% return one year!) and pretty soon they were millionaires. During this time, they made a very poor decision-- They took out a new loan on the house in order to invest the money, and began making only interest payments on the new loan. The new money was invested. They also had made the poor decision of funding so-called "retirement accounts" which are also a generalized scam because they put limitations on a persons abillity to spend and invest his own funds. Unfortunately, the following occured-- the markets crashed, especially the telecoms, and all of the available funds except for $50,000 were gone. There remained about 1/2 Million in retirement accounts, but the money was unremovable. They didn't really have the income to pay the larger mortgage on a month-to-month basis, and they had been only paying interest... So, at this point, they have $250,000 in debt, not enough available income to make the payments on the mortgage, and only $50,000 available. My mom again took some time off of work and during this time the $50,000 was spent (my sister and I had also started college.). My mom recently began working again, and now the situation is such that they are STILL only able to pay the interest on the mortgage, and they are struggling to do that! The money in the retirment accounts has depreciated further due to continuing bad market conditions... They are broke. If they were to withdraw the money from the retirement accounts, they would not have enough (after tax penalties) to buy their own house! A house they could have bought straight-out 8 years ago! Had they bought the house originally, they would have been able to make $30K a year in investments, and still would have ended up with close to a million dollars at the end of the ninties. Again, assuming retirment accounts still, the available funds would have decreased to near $0... but the difference is that a $250,000 house would still be in their legal posession. They would not be making payments on it, and the current financial situation we are in would not be particularly troublesome. They purchased their first house on loan when they were in their early twenties... 22, I think. They are 56 now, and still have a thirty year mortgage. My grandmother purchased her first house on loan when she was 25. She is 76 now and still has a twenty-five year mortgage. The house my grandfather built on a $10,000 loan in the early 40's, now has over $50,000 in debt attached to it. And the banks, the Rockefellers, the people who hold mortgage notes? They've ended up with approximately 1/5 of all the money that my parents HAVE EVER MADE! And lemme tell ya what, there are 200 million Americans and a good number of Brits who are doing the same damn thing. That's a lot of money. Fudge the banks! | When purchasing an automobile, what has your method of payment been? |
