tag:blogger.com,1999:blog-7188858439852729115.post6971475249905153816..comments2023-05-22T03:04:42.242-05:00Comments on Dame Eleanor Hull: Random bullets of NovemberDame Eleanor Hullhttp://www.blogger.com/profile/06512884104691200975noreply@blogger.comBlogger6125tag:blogger.com,1999:blog-7188858439852729115.post-77931231299608474922011-12-02T23:01:14.353-06:002011-12-02T23:01:14.353-06:00Never forget maintenance and repair. And the quest...Never forget maintenance and repair. And the question of what you want to live in.<br /><br />I bought the house because it was really cheaper than renting, especially given what you could rent (not much). Otherwise I think there are a lot of advantages to renting over owning, even with the tax advantage of a mortgage - esp. in a state with noticeable property taxes (I am not in one such). Buying/prepaying is good if you're staying, less so if you are not.Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-7188858439852729115.post-46555837256311153492011-11-28T19:41:18.841-06:002011-11-28T19:41:18.841-06:00The NY Times also has a very straightforward calcu...The NY Times also has a very straightforward calculator that compares buying and renting . . .Naryahttps://www.blogger.com/profile/05369280617520806983noreply@blogger.comtag:blogger.com,1999:blog-7188858439852729115.post-70724547977913247372011-11-26T13:37:01.255-06:002011-11-26T13:37:01.255-06:00Forgot one other factor: If you're thinking a...Forgot one other factor: If you're thinking about moving. Mortgages are less attractive if you're planning on staying put for the long haul. If you're positive you're going to move there are some skeevy things you can do with ARMs that may be better than paying off the mortgage (assuming you can find a buyer for the house when you're planning on moving).Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-7188858439852729115.post-61932601084355663462011-11-26T13:21:44.891-06:002011-11-26T13:21:44.891-06:00Here's where you can get the amortization spre...Here's where you can get the amortization spreadsheet:<br />http://www.getrichslowly.org/blog/2007/10/01/accelerated-mortgage-payments-and-the-grs-amortization-calculator/<br /><br />It looks like this will give you your effective interest rate once tax deductions are taken out: http://www.bankrate.com/calculators/mortgages/loan-tax-deduction-calculator.aspx<br /><br />In terms of interest rates: How likely are you to need to borrow money at a higher rate than your effective rate in the future? If you're unlikely, then there's less reason to keep your mortgage. (It's better to keep the mortgage and pay cash for the next car, for example.) If you have a higher risk tolerance, you may want to keep a historically low mortgage on your house to free up that money to invest in the stock market. Only do this if you're sure your income stream will keep up your fixed payments even if you lose everything extra on stocks.<br /><br />If you're worried about an earning member of the family losing a job, then that could do two things to your decision about paying off the mortgage. Here you would want to calculate how much lower your fixed expenses are each month without the mortgage (remembering you still have to pay escrow). If it's a big chunk, can you handle one earner not bringing in money with the new lower expenses? If so, then it's less risky to pay off. If, on the other hand, the mortgage (minus escrow) is only a small portion of the monthly budget, then having that money as cash in an emergency fund is less risky because it will provide a buffer while the person tries to find another job and you try to cut expenses.<br /><br />So there's some thoughts on how to approach the problem.Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-7188858439852729115.post-40936423637262354442011-11-26T13:21:01.998-06:002011-11-26T13:21:01.998-06:00Thanks for the GRS suggestion---I've found som...Thanks for the GRS suggestion---I've found some useful posts there already (& how come I'd never been there before? you guys must have linked).Dame Eleanor Hullhttps://www.blogger.com/profile/06512884104691200975noreply@blogger.comtag:blogger.com,1999:blog-7188858439852729115.post-38055788240512594962011-11-26T13:08:32.315-06:002011-11-26T13:08:32.315-06:00Your Money or Your Life isn't about finances, ...Your Money or Your Life isn't about finances, really, it's about Life and Jobs and Career. (And no, you don't have to be like the author! We at grumpy rumblings enjoy the finer things of life and will never give up our gazingus book pins.)<br /><br />If you want a straight up Finance book that doesn't just take one path and discusses pros and cons of different styles, Your Money The Missing Manual by JD Roth is a great primer. It doesn't go deep into investing-- if you want investing I'd recommend The Bogleheads Guide to Investment. (No touchy-feeliness there.) The CNN/Money primers are also useful as are the Motley Fool basic pages (before they decided to start shilling individual stocks).<br /><br />From what you're saying, you may be a good fit for The Smart X Finish Rich guy, David Bach. Any one of his books.<br /><br />As to why there's so much touchy-feely stuff... well a lot of people who get into money problems need the touchy-feely stuff. They need the tough love you can do it approach of Dave Ramsey, or the exploring the family emotions from Suze Orman.<br /><br />You can also ask us on our blog and we'll devote an Ask the Grumpies post if you've got specific questions. Though it may take a while if the question is harder to answer than, "Do you want an octopus?"<br /><br />As to your particular question about pre-paying the mortgage vs. keeping money in the bank, we actually have a post or two on that already and GRS has several posts on how to approach that question. I'll dig them up in a bit. Personally I found the GRS mortgage prepayment spreadsheet to be incredibly helpful in that respect because it allows you to run through a bunch of different scenarios.<br /><br />There used to be a good calculator on the internet that will calculate your effective mortgage rate based on your tax rate, but the link has been broken for some time. There may be another by this point.Anonymousnoreply@blogger.com