And that is fine.....each person sees things differently.

I applaud him for being debt-free....in my line of work (Credit) I have seen it all. I just started my 34th year in the Credit Industry and I have seen the ebb's and flow's of credit and its abuses.

His posts remind me a great deal of a seminar I went to at an Industry Group Convention. Our speaker that year was Frank Abagnale, the gentleman that the story "Catch Me If You Can" was made about. I was fascinated on one hand and appalled on the other hand.....the amount of fraud he had perpetrated and yet still he still didn't seem sincerely sorry.

mmaddog
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LOL....good one.....but I am sure you know what I really meant.

But just for grins and giggles....I drive a 2000 Toyota Sienna (paid for) and the A/C is broken. I don't care to spend $600 to fix it when all I do is drive it to work and back a total of 21 miles. So i taped over the coin slot that way everything on the radio is free.

mmaddog
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That's why I had the disclaimer of it making sense if you don't have much of an income. If there's nothing to garnish, a judgment doesn't mean anything. If you owe the money, you owe the money. A judgment doesn't tell you anything new. I understand what you're saying, though.

I'll have mine paid off before too long. My goal is to have it paid off by the time I'm 35. That gives me 4 years. 40 might be more likely, though. I subscribe to the "pay yourself first" philosophy. A huge portion of my income is socked away before the check ever reaches my account. I make a six figure income, but I realize considerably smaller amount.

If I really had it to do over again, I would have found a house for about $80,000 as my first place and paid it off by the time I was 25, lived in it until I was 30, and then paid cash for about a $200,000 house. Given the market and interest rates, maybe I would have bought about a $250,000 house (that had been $300,000 a couple years before) and had a $300 mortgage payment until I paid it off in 2 years.

Sounds pretty good in hindsight, but try convincing a kid right out of college to do that.

Man if you have that paid off by 35, you will be sh*&*^^ing in high cotton for many years, and you will actually be doing better than me by 7 years...

Thats a damn good income too and you will be a very wealthy man if you make smart choices.

Congrats to you

I know what you meant. Just saw an opening and took it. Believe me, I understand credit/leverage. I have a degree in Finance, but I don't want anything to do with debt. It ruins way too many people's lives. It's very dangerous even when used responsibly, but most people don't use it responsibly. That's when it becomes toxic.

I was debt free except for my mortgage by age 30. I can't imagine wanting to go back.

I'd check with an attorney before accepting this advice...just walking away doesn't wipe it from the slate. And can come back to haunt.

Bad advice....but R8s already pointed that out. If he doesn't file BK then it still leaves him vulnerable to suits and judgements and those don't go away for 10 years. He'll rebuild before then and have to face the prospect of dealing with what put him in the situation first.

Good advice...to a point. Let me put up a nice scenario:

R8's sitting comfortably in his paid-for debt free home. One day he goes to work and because the boss pissed him off he says "I quit". A couple of weeks later he finds out he's got serious health issues (heart attack, kidney issues, etc) and has no insurance. While he's got the 6 figure savings account, all it takes is one trip to the hospital and suddenly that six figures includes the zero's after the decimal. Where does he go from there?

mmaddog
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One heart attack without insurance can wipe out a lifetime of savings, you are 100% correct but...

say I am sick of my job(which I am not) and I want to take one making alot less money.... I can do it as long as they have good insurance of course

If you can't make the payments, you can't make the payments. They can try to collect the deficit later on, but they have no recourse if he BKs.



It's not bad advice if he doesn't have much income. If he's broke because he lost his job or something, the judgment has no teeth. They can't take what he doesn't have. He can always BK down the road, but there's also a chance that he can scrape some money together first and settle the debts for a fraction of what was owed.


Why would he have no insurance? If you've got enough money to tell your boss to f*** off, you've got the money to buy an individual insurance policy. Anybody who is financially savvy enough to be 100% debt free including his house in his early 40s will be prudent enough to have the insurance thing covered backwards and forwards.
1. Health Insurance
2. Auto Insurance
3. Homeowner's Insurance
4. Long-term Disability Insurance
5. Life Insurance (if needed)
6. Long-term Care Insurance

I say "if needed" to the life insurance because, once you are debt free, it doesn't take much to self-insure.

I need to work on #6 I have all the others covered

It appears neither of you have had a devastating health problem or you wouldn't be so sure that having insurance will take care of everything....even with insurance all it takes is one catastrophic health issue and everthing you have can be reduced to nothing.

And you need to be damn sure you know your policy inside and out....there are many who don't know the fine print and then later get surprised by something they thought was covered, but isn't.

Being confident is good....being naively over-confident can have devastating consequences.

I guess what I am trying to convey....nothing is a sure bet. Life experience has taught me that even the best prepared are sometimes caught flat-footed.

mmaddog
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Unfortunately the companies that pay a lot less also have really crappy insurance for their employees.

But even some insurance is better than none at all.

mmaddog
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http://customsites.yahoo.com/financi...106000-in-debt

Getting out of debt can be done.

Hey guys I enjoy reading about all this stuff keep up the good conversation and I might just learn something.
Which Dave Ramsey book? He has several but which one would be the best to get me out of debt and squared away? Thanks for the info!

Debt free is great, but you are missing out on some great tax advantages, especially if you bank, not to have payments on some type of real estate. Interest and depreciation can really help reduce your taxable income.

My house is paid for, but it came at the cost of me totally remodeling it myself. (1.5 years of work) I do have plenty of leveraged secured debt on investment properties, but in all cases I have at least 25% + in equity through improving the property or large down payments.

I used to be big into stocks and I still do invest quite large % into a roth ira, but I have given up actively managing it myself. I found out quick that I am not a wall street guru. I prefer real estate investing in my local town, where I can physically see what my investment is doing. I will give you it can be a pain in the neck dealing with tenants, but just part of the job.

My plan is to keep upgrading my primary residence every 2 years or so and buy properties that can gain significant appreciation through remodeling. Therefore I can bypass the capital gains tax.

http://www.audiobooksonline.com/medi...udio-books.jpg