Mortgages and Medicine.

October 29, 2014 · 0 comments

Unless you are the dumbest person in the world, you probably have realized I’m not the biggest fan of debt. I think it’s pretty stupid and unlike most PF bloggers, I don’t believe “good debt” exists.

Although I’m a pretty avid debt puncher, I do compromise on two issues…

Home

If you didn’t already know, houses are kind of expensive. The median home price in my zip code is $500,000. Even if Girl Ninja and I were able to stock away a whopping $50,000/yr in savings (which we aren’t), it would take us 10 years before we could pay cash for a house in our hood. And that’s assuming home prices don’t increase during those 10 years we save (which we know it will).

Last year we took on a $280,000 mortgage for our $350,000 home. That means we put 20% down, and financed the remaining 80%.

I would never try to call my mortgage debt “good”, perhaps “necessary evil” is a better descriptor.

Medical

This one goes without saying, and I assume most of you would agree.

If for some reason the crap hit the fan and I was faced with a decision between death or debt, I’m gonna take on some debt. That said, I am doing what I can to ensure I never have to be faced with that choice. I pay a pretty penny for health/dental/vision insurance each month, not to mention I have a decent chunk of change sitting in an emergency fund.

My insurance and savings should significantly diminish the chances of having unpaid medical bills , but on the rare chance I needed to buy an organ on Ebay, you better believe I’d do so. Side Note: How much you think a kidney goes for on the black market? $50K? $100K?

That pretty much wraps up my Tolerable Debt List. I realize my stance may be extreme for some, and for others it’s probably not strict enough. And this leads to today’s question….

Where do you draw the debt line?

What type of debt have you sworn off for good (credit cards, car, mortgage, payday loans)?

What type of debt are you comfortable with (mortgage, cars, 0% credit card offers, etc)?

At what point does debt go from being logical to being ridiculous?


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When did that happen?

October 21, 2014 · 10 comments

Sometimes I think to myself “I can’t believe I’m a grown up!”. I don’t feel old. I don’t look old, and I sure as h-e-double-hockey-sticks don’t act old. I use to think “old” was an age, but I’m quickly learning it’s a lifestyle.

I remember being bored to death when my parents would watch political news. It didn’t make any sense to me. Why was watching some old guy talk about two other old guys interesting? If it wasn’t on MTV, I didn’t watch it. (Still love me some 16 and pregnant…I know…embarrassing).

Same goes for finances. Although I have always enjoyed numbers (self proclaimed math nerd), I hated dealing with money. Did you know I didn’t learn how to write my own checks until I was 21 years old. Twenty-freakin-one. Pathetic right? I also didn’t know how to log in to my checking and savings accounts until after I graduated college. I had to have Mom Ninja sit me down and show me how online banking worked.

As much as I don’t want to accept it, I guess I’ve kind of become a legitimate grown up. I’m married, I manage my own money, and heck, I even cook my own dinner sometimes! I find myself becoming more and more interested in “old guy” stuff like politics and finances. I can’t help but laugh when I reflect on how much I hated the shows my parents watched when I was a kid, to now find myself watching the same darn things.

I sit here wondering “What other things will become interesting to me as I age?” Maybe I will take up quilting, lawn bowling, or listening to AM radio.

Wait, what am I saying… in an attempt to enjoy my young spirit, I think I’m going to go buy a pair of Jnco jeans (please tell me someone remembers these), a hacky sack, a set of pogs, and I’m gonna go watch Boy Meets World and Full House (TGIF for the win!!!!).

Have you found yourself enjoying things you once hated (art, coffee, reading for pleasure, history channel, etc)? What “childish” things do you still enjoy (cartoons, video games, Macaroni and Cheese)? At what age does one go from young to old?

 

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You ever read a blog post that went something like this…

You might want to think twice before you buy that scooter. It would set you back $3,000, and will likely only provide you entertainment for a handful of years.

What if you invested that money instead? 

If you put $2,000 in to a Roth IRA and let it grow for 30 years, at 8%, you would end up with $30,000. 

THIRTY-THOUSAND DOLLARS!!!!

Is that scooter really worth $30,000 to you? I didn’t think so. Now go give yourself a spanking and put yourself in time out for even thinking that buying a scooter was reasonable! 

I can’t tell you how many times I’ve read some iteration of the post above. Maybe instead of a scooter, it’s a vacation. Or a boat. Or a house. Or probably the most popular topic for an argument like this to appear, a wedding post.

Consider this my permission to flip those other PF bloggers the internet version of the bird and tell ‘em to buzz off. Unless of course, your goal is to be miserable for the rest of your life.

Then by all means, drink the kool-aid.

Personal finance bloggers commonly confuse the terms financial freedom and wealth.

THEY ARE NOT THE SAME THING.

Say I had $1,000,000 in my 401k right now. I am literally a millionaire. You’d probably even say I was wealthy.

But am I free?

HECK NO!

My 401k isn’t going to pay my cable bill, put groceries on our table, or a car in my driveway for another 30+ years. Yeah, I’m a millionaire, but I’m no more free than the dude that bags groceries down the street at the local Safeway.

We both still have to go to work tomorrow.

Do you get it? 

You need to be working towards financial freedom, not wealth building.

Even though I still have to work, I consider myself relatively free. My job provides the best work/life balance of anyone I know. We have a roof over our head. We contribute 15%-20% towards retirement. And we’re content living within our means, no pinching pennies, but we still have to be mindful of our spending. As far as I’m concerned; we’re retired.

It’s a beautiful place to be, and a place I hope you are in, or working towards finding. 

Don’t get discouraged by the PF bloggers who talk about how great early retirement is even though they are still slaves to their blog (or their portfolios), who make you feel terrible for buying a new car, or who tell you there is no such thing as saving too much.

Those bloggers suck.

You be the best YOU you can be. Make a plan. Stick to it. And enjoy the ride along the way…even if that means you end up having a $30,000 wedding.

You don’t have to be a millionaire to be happy. Promise. 

A few months after graduating college, the federal government offered me a job to work for them as a Special Agent. I was 21 at the time and the prospect of a “cushy” government job seemed too good to pass up. I mean, I had $28,000 in student loans to pay back after all.

I remember taking the job and being asked by my peers if I thought I was going to do this gig for the rest of my life. My response was always the same…

“If I’m still doing this job five years from now, I’ll probably do it for the rest of my life.” 

Right at the five-year mark I got super motivated to look for a new job. I applied to a couple dozen positions, had a few interviews, but was rejected from every job I applied for. In case you aren’t familiar with the process, getting rejected sucks. But hey, that’s life right?

Now, in my seventh year as a fed, I’m coming to terms with the fact that I’m probably a lifer.

That’s right, I will most likely work the exact same job, day in and day out, for the next thirty years.

AND I’M REALLY EXCITED ABOUT IT! 

At 21 years old, I thought one’s professional success is defined by the job title they hold and the salary they command.

I nailed that first one. I mean how sweet is it that my literal job title is Special Agent?

The second one, not so much.

While I make a nice chunk of change, I’ll never earn a huge six-figure salary. It is the government after all and everything is regulated by congressional mandates.

But at almost-30-years-old, I’m realizing one’s salary means very little in the grand scheme of things.

Imagine this…

Ten, twenty, fifty years from now you are on your death-bed. One of your teenage grandkids looks at you and says,

“Grandma/Grandpa, What’s the one thing you wish you could have done more of in life”

How many of you are going to respond to that question with “I wish I could have made more money.”?

Probably not you. right?

Although we may not always act like it, deep down inside, we know that our income should not define our worth.

To further convince myself of this fundamental truth, I decided I would make a Pros and Cons list of my position:

Work pros and cons

According to math there are far more things on the left side than the right.

Therefore, I should be content and keep my job. 

Anyone else out there a “lifer” in your position (teachers, firefighters, and physicians where you at!)?

How many jobs have you held in your adult life? 

 

 

We decided to give being a one car family a shot

September 30, 2014

Cars are freaking expensive. Even though both of our cars were fully paid off (’07 Scion tC and ’06 Honda Pilot) they still ate up a considerable amount of our discretionary income. Gas ($300/mo), insurance ($120/mo), and maintenance (call it $600+/year)  aren’t cheap. So even though our cars were paid off, they were still costing us about $500 […]

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My new money making hobby

September 25, 2014

If you’ve been reading my blog for over four years (which probably no one has), you may recall I used to own a motorcycle. Shortly after I got my crotch rocket, my dad got a Harley. Shortly after my dad got a Harley, he got in a motorcycle accident which nearly cost him his leg […]

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Are you investing more or less than you thought?

September 21, 2014

Just about every personal finance guru has an opinion on how much you should contribute to retirement. Their suggestions usually falls between 10% and 20% of your gross income. For as long as I’ve been at this personal finance thing (since 2007), I’ve decided to contribute no less than 15%. Here’s what my retirement contributions […]

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