Living off one income question

[rx7boi]

Beyond wouldn't be the same without derails. Would give you more rep but I'm all maxed out.

[ThePenIsMightier]

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...
We also recently proved that some Beyonders misuse and toss the word racism around like Subway napkins.

Why are you littering with Subway napkins so much and who else is doing this?
Or, do you mean you're littering on the train?

That's literally racist.

[max_boost]

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No matter what else we've proven, I think we have conclusively proven that I only mean about 50% of what I type and only 23% of anything I type is worth reading. However, I post so much, I still have more useful info on this forum than anyone else. #lifehacks.

Always being extra. I dig it tho, slow.

[rx7boi]

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Why are you littering with Subway napkins so much and who else is doing this?
Or, do you mean you're littering on the train?

I wouldn't mind living off of owning a Subway.

[Xtrema]

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gettin' that mortgage down!

I felt unease seeing Buster advocating reducing mortgage debt.

[max_boost]

If you're good with money, don't pay down the mortgage.

If you're bad with money, pay down the mortgage.

[pheoxs]

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If you're good with money, don't pay down the mortgage.

If you're bad with money, pay down the mortgage.

What if I just have no money?

[Mitsu3000gt]

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If you're good with money, don't pay down the mortgage.

If you're bad with money, pay down the mortgage.

Pretty much this. If you have a low mortgage rate and you're paying any more than the minimum you're doing it wrong (in most cases). Just giving up free money.

[dirtsniffer]

~3% guaranteed return is nothing to scoff at.

[killramos]

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~3% guaranteed return is nothing to scoff at.

[JustinL]

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~3% guaranteed return is nothing to scoff at.

Also tax free.

[rx7boi]

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Also tax free.

Not to mention the psychological benefits of knowing you owe less on your home.

[pheoxs]

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Also tax free.

Only for primary residence tho.

[killramos]

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Only for primary residence tho.

No the "effective return" on reduced interest for paying down your mortgage is essentially always tax free.

Only time it sort of isn't is if you claiming the interest as an expense against other earnings ( Rental property, leveraged investing etc. ).

Capital gains on non primary residence is what is taxable.

[pheoxs]

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No the "effective return" on reduced interest for paying down your mortgage is essentially always tax free.

Only time it sort of isn't is if you claiming the interest as an expense against other earnings ( Rental property, leveraged investing etc. ).

Capital gains on non primary residence is what is taxable.

Whoops. Still to early in the morning X_X

[killramos]

All good lol

[Buster]

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I felt unease seeing Buster advocating reducing mortgage debt.

really? why?

[Buster]

Paying down your mortgage is somewhat close to even with keeping it invested when long term returns are used in the calculation. So paying down your mortgage is essentially a risk decision in terms of how much leverage you want to apply to your investment portfolio. If you reduce your leverage on your investment portfolio by paying down your mortgage, then you can increase your expected return (and volatility) in your portfolio by allocating more assets to equities from fixed income.

If you have investments plus a mortgage you are not leveraging your home with the mortgage, you are leveraging your investment portfolio, in effect.

You can never time the market, so staying invested through thick and thin is the best way forward. However, you have no choice but to make an active decision on how much you are leveraging your portfolio using home equity. Run the numbers on what happens to an investment portfolio that is leveraged vs non-leveraged in the case of a 5% , 10%, and 20% market correction.

[killramos]

Yea leveraging your portfolio with no tax benefits to go along with it.

[ExtraSlow]

Next up, why living in a larger home than you need is a smart financial decision!