controversial opinion: money & finances edition

[Anonymous]

Anonymous wrote:

Anonymous wrote:I think spending hundreds of thousands of dollars extra on a house so that your children go to “good schools” is just coded racism for staying away from minority poor people.

Or.... we just want good schools. I don't care if my kid is the poorest or whitest kid in the school. I want the best education.

I agree that some people do this but I can attest that we are one of the dwindling numbers of white families in our district (mostly Asians - this is in NYC area) and we are doing it for the best schools, not to stay away from minority poor people. In fact, I would welcome some minority poor people into the mix so it's a little more balanced!

[Anonymous]

Anonymous wrote:

Anonymous wrote:I think spending hundreds of thousands of dollars extra on a house so that your children go to “good schools” is just coded racism for staying away from minority poor people.

Or.... we just want good schools. I don't care if my kid is the poorest or whitest kid in the school. I want the best education.

Do you though? What kind of research do most people do into different areas? Test scores and demographics. Neither of these measures really determine whether your child will get the ‘best education.”

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:I think people who put themselves in a position to still have college loans into their 30s are blazing idiots. If you cant make enough to pay your loans by age 29 with your white collar job, you are a failure.

I must be a blazing idiot because I will continue putting my cash in the stock market as opposed to servicing low interest debt. I'm 36 now, and don't have any plans to pay them off soon. The interest rate is 2.5%.

Yes, you are. Clear your debt.

Honestly I could pay it if with a couple clicks and sales from my brokerage account, but why would I? The brokerage account has far outperformed the cost of the debt. No thanks. I'll keep building wealth.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:People (other than business owners) who lease cars like to waste money

Not really. Or at all.

People who buy new cars outright pay the lease too. Only for them it's called depreciation and comes out of their net worth instead of their income. Leasers pay the depreciation too and have the benefit of tens of thousands of dollars being tied up in a depreciating, non productive asset.

There are a lot of people, here especially who really have no clue about finance (you included)

Your math falls apart once I own the vehicle outright and you're still paying for a car you'll never own.

Hint: your asset has lost half of it's value and will continue to lose value until its only value is as scrap metal. Not paying it as a lease so all right though

[Anonymous]

Anonymous wrote:

Anonymous wrote:We lease cars, travel internationally every year and have a generally nice life

We only spend 10% of our post tax income

There is a middle ground

um ... what? you just sound very wealthy or am I missing something?

We are

Very wealthy

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:People (other than business owners) who lease cars like to waste money

Not really. Or at all.

People who buy new cars outright pay the lease too. Only for them it's called depreciation and comes out of their net worth instead of their income. Leasers pay the depreciation too and have the benefit of tens of thousands of dollars being tied up in a depreciating, non productive asset.

There are a lot of people, here especially who really have no clue about finance (you included)

Your math falls apart once I own the vehicle outright and you're still paying for a car you'll never own.

Hint: your asset has lost half of it's value and will continue to lose value until its only value is as scrap metal. Not paying it as a lease so all right though

Strange place for an eyeroll, given that you don't even have an asset in this scenario. But sure, feel superior to PP because the depreciating asset that they own is losing value, while the depreciating asset that you rent is also losing value. Makes sense.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:To add to the above, I think it's crazy when UMC get on the college forum and say "My kid got into X private college but we can't afford it. Wah wah wah. Life is so unfair for us UMC."

And it turns out they make like 300k.

Why weren't they saving all along? That's what I want to know. When you have a baby, the baby's needs come first. That means college savings before a big house or fancy vacations and cars, etc.

They probably have been saving all along. They also weren't making $300K or anything close to it 20 years ago; spent 5-10 years paying thousands of dollars a month for childcare; had student loans to pay off; other (disability, elderly parents, medical disaster, other).

The real question is, why is it ok for the increase in college costs to far outpace inflation?

Because there is too much cheap money (i.e., easy to obtain loans) when the reality is that not all kids should go to a 4-year college.

The real reason is that people are going to go to college. At any cost.

If you knew that people would save up $200,000 just to go to college, you would jack up the prices too

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:People (other than business owners) who lease cars like to waste money

Not really. Or at all.

People who buy new cars outright pay the lease too. Only for them it's called depreciation and comes out of their net worth instead of their income. Leasers pay the depreciation too and have the benefit of tens of thousands of dollars being tied up in a depreciating, non productive asset.

There are a lot of people, here especially who really have no clue about finance (you included)

Your math falls apart once I own the vehicle outright and you're still paying for a car you'll never own.

Hint: your asset has lost half of it's value and will continue to lose value until its only value is as scrap metal. Not paying it as a lease so all right though

Strange place for an eyeroll, given that you don't even have an asset in this scenario. But sure, feel superior to PP because the depreciating asset that they own is losing value, while the depreciating asset that you rent is also losing value. Makes sense.

Nope, wrong again

I invested the price of pp's car. Worth 4 times that now.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:People (other than business owners) who lease cars like to waste money

Not really. Or at all.

People who buy new cars outright pay the lease too. Only for them it's called depreciation and comes out of their net worth instead of their income. Leasers pay the depreciation too and have the benefit of tens of thousands of dollars being tied up in a depreciating, non productive asset.

There are a lot of people, here especially who really have no clue about finance (you included)

Your math falls apart once I own the vehicle outright and you're still paying for a car you'll never own.

Hint: your asset has lost half of it's value and will continue to lose value until its only value is as scrap metal. Not paying it as a lease so all right though

Strange place for an eyeroll, given that you don't even have an asset in this scenario. But sure, feel superior to PP because the depreciating asset that they own is losing value, while the depreciating asset that you rent is also losing value. Makes sense.

Nope, wrong again

I invested the price of pp's car. Worth 4 times that now.

DP. Please show your math. Virtually everybody who looks at the issue concludes that owning is cheaper in the long run. The one exception is low mileage drivers who keep their cars in pristine condition.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:People (other than business owners) who lease cars like to waste money

Not really. Or at all.

People who buy new cars outright pay the lease too. Only for them it's called depreciation and comes out of their net worth instead of their income. Leasers pay the depreciation too and have the benefit of tens of thousands of dollars being tied up in a depreciating, non productive asset.

There are a lot of people, here especially who really have no clue about finance (you included)

Your math falls apart once I own the vehicle outright and you're still paying for a car you'll never own.

Hint: your asset has lost half of it's value and will continue to lose value until its only value is as scrap metal. Not paying it as a lease so all right though

Strange place for an eyeroll, given that you don't even have an asset in this scenario. But sure, feel superior to PP because the depreciating asset that they own is losing value, while the depreciating asset that you rent is also losing value. Makes sense.

Nope, wrong again

I invested the price of pp's car. Worth 4 times that now.

So the cost of your lease is ... free? Yes, that's probably a good deal. It's also a lie, but okay. You're not just spending the money PP spend on his car, you continue to spend it when PP's loan is paid off and you're on to your next lease.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:To add to the above, I think it's crazy when UMC get on the college forum and say "My kid got into X private college but we can't afford it. Wah wah wah. Life is so unfair for us UMC."

And it turns out they make like 300k.

Why weren't they saving all along? That's what I want to know. When you have a baby, the baby's needs come first. That means college savings before a big house or fancy vacations and cars, etc.

They probably have been saving all along. They also weren't making $300K or anything close to it 20 years ago; spent 5-10 years paying thousands of dollars a month for childcare; had student loans to pay off; other (disability, elderly parents, medical disaster, other).

The real question is, why is it ok for the increase in college costs to far outpace inflation?

Because there is too much cheap money (i.e., easy to obtain loans) when the reality is that not all kids should go to a 4-year college.

The real reason is that people are going to go to college. At any cost.

If you knew that people would save up $200,000 just to go to college, you would jack up the prices too

.

No no, don’t look at that! Look over here!

Just point your finger at those irresponsible people who didn’t save enough!

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:People (other than business owners) who lease cars like to waste money

Not really. Or at all.

People who buy new cars outright pay the lease too. Only for them it's called depreciation and comes out of their net worth instead of their income. Leasers pay the depreciation too and have the benefit of tens of thousands of dollars being tied up in a depreciating, non productive asset.

There are a lot of people, here especially who really have no clue about finance (you included)

Your math falls apart once I own the vehicle outright and you're still paying for a car you'll never own.

Hint: your asset has lost half of it's value and will continue to lose value until its only value is as scrap metal. Not paying it as a lease so all right though

Strange place for an eyeroll, given that you don't even have an asset in this scenario. But sure, feel superior to PP because the depreciating asset that they own is losing value, while the depreciating asset that you rent is also losing value. Makes sense.

Nope, wrong again

I invested the price of pp's car. Worth 4 times that now.

So the cost of your lease is ... free? Yes, that's probably a good deal. It's also a lie, but okay. You're not just spending the money PP spend on his car, you continue to spend it when PP's loan is paid off and you're on to your next lease.

OK, I'll explain very slowly for you

PP has $50,000. PP brought a car with it. 10 years later it's worth $20,000 (a charitable amount). $30,000 loss
I had $50,000. I invested it. 10 years later it has grown to $103,052. Lease payments $65,000. I'm ahead $37,000.


I'll continue to be ahead of PP forever because I chose to take advantage of compounding and because I bothered to look at opportunity costs instead of parroting advice from a personal finance book from 30 year ago that was written for people with 1/10 of my income.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:People (other than business owners) who lease cars like to waste money

Not really. Or at all.

People who buy new cars outright pay the lease too. Only for them it's called depreciation and comes out of their net worth instead of their income. Leasers pay the depreciation too and have the benefit of tens of thousands of dollars being tied up in a depreciating, non productive asset.

There are a lot of people, here especially who really have no clue about finance (you included)

Your math falls apart once I own the vehicle outright and you're still paying for a car you'll never own.

Hint: your asset has lost half of it's value and will continue to lose value until its only value is as scrap metal. Not paying it as a lease so all right though

Strange place for an eyeroll, given that you don't even have an asset in this scenario. But sure, feel superior to PP because the depreciating asset that they own is losing value, while the depreciating asset that you rent is also losing value. Makes sense.

Nope, wrong again

I invested the price of pp's car. Worth 4 times that now.

DP. Please show your math. Virtually everybody who looks at the issue concludes that owning is cheaper in the long run. The one exception is low mileage drivers who keep their cars in pristine condition.

winner winner chicken dinner

[Anonymous]

Leaning out is a bad financially because you miss out not only on contributing to retirement but also on career advancement for the spouse who leans out.

For us, that proved not to be true. At the end of the day, we were unequivocally better off financially with one income in an extremely lucrative field (but one that required long hours and almost weekly travel) then we were splitting household duties and working more regular hours as a federal employee and engineer.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:People (other than business owners) who lease cars like to waste money

Not really. Or at all.

People who buy new cars outright pay the lease too. Only for them it's called depreciation and comes out of their net worth instead of their income. Leasers pay the depreciation too and have the benefit of tens of thousands of dollars being tied up in a depreciating, non productive asset.

There are a lot of people, here especially who really have no clue about finance (you included)

Your math falls apart once I own the vehicle outright and you're still paying for a car you'll never own.

Hint: your asset has lost half of it's value and will continue to lose value until its only value is as scrap metal. Not paying it as a lease so all right though

Strange place for an eyeroll, given that you don't even have an asset in this scenario. But sure, feel superior to PP because the depreciating asset that they own is losing value, while the depreciating asset that you rent is also losing value. Makes sense.

Nope, wrong again

I invested the price of pp's car. Worth 4 times that now.

So the cost of your lease is ... free? Yes, that's probably a good deal. It's also a lie, but okay. You're not just spending the money PP spend on his car, you continue to spend it when PP's loan is paid off and you're on to your next lease.

OK, I'll explain very slowly for you

PP has $50,000. PP brought a car with it. 10 years later it's worth $20,000 (a charitable amount). $30,000 loss
I had $50,000. I invested it. 10 years later it has grown to $103,052. Lease payments $65,000. I'm ahead $37,000.


I'll continue to be ahead of PP forever because I chose to take advantage of compounding and because I bothered to look at opportunity costs instead of parroting advice from a personal finance book from 30 year ago that was written for people with 1/10 of my income.

You can't "take advantage of compounding" by putting $50k in the market and immediately, and monthly, drawing down from it. Also you don't get to credit yourself the value of ten years of compounding on $50k and then take imaginary lease payments out of the backend like you drove the car for free for a decade while compounding gains and can then pay out of capital gains after you've made 10 years of gains.

In the more traditional scenario, PP makes payments for 4 years, and then has 6 years to invest more than you're investing because their car payment has ended and *you're still making lease payments.* Meanwhile you have the option to invest the delta between a lease and car payment, which gives you more money for the market than PP in the first 4 years and significantly less money than PP to invest in the next 6 years.