What is wrong with buying a car for cash? - Page 2 - GoFuckYourself.com

xxweekxx · 01-22-2010, 01:16 PM

this is a nice chart.. factors in everything..

http://www.nytimes.com/2007/04/10/bu...T_GRAPHIC.html

for the most part, buying is better, unless you are going to be there for <2yr

i did the math right, and ive spent around $100k in rent since i started renting, maybe a little more.. yet i dont have a house or nada...

the same $100k woulda gotten me a small little house somewhere..

woj · 01-22-2010, 01:18 PM

Quote:

Originally Posted by xxweekxx

thats assuming you make 12%/yr on stocks for 30 years in a row..

you are missing a very important part of the math, the fact that the person who DID not buy has to pay rent..

so the guy who basically decided to take the 20k and invest in stocks, will have spent say $500/month on that same house in rent..

so thats $6kyr = $180k in 30 years..

so in 30 years, the guy who bought a house, is paying for it, BUT LIVING in it, hence after 30 years he still has an asset worth a lot more than he paid..

the guy who didnt buy and put the money in stocks, had to pay RENT, so in 30years, he might have made money from stocks, but he also spent a minimum of $200k in rent for that period.. makes sense?

Yea, but buying a house means you have to pay mortgage, taxes, maintenance, insurance, etc.... you think all that will work out to be less than $500/month?

xxweekxx · 01-22-2010, 01:21 PM

its not that expensive.. my sister has a house in TN, cost her around $135k, her taxes are like $1k/yr, insurance a few hundred a yr.. maintenance $0 so far in a year.. its not like people make it out to be..

Heres my question: if say you work 9-5, and you can afford $1,500 on living.. are you better off getting a house and using that 1.5k for mortgage, or are you better off spending that $1.5k on rent..

This is a good scenario because thats where majority of americans fit in..

in my scenario, you'll see its a much much better idea to buy given those circumstances

at least from your $1.5k mortgage, a good chunk goes towards your house, so lets say $500 is interest, then the other $1000 is "your" money... while in the rental scenario, the $1.5k is going towards nothing, same thing as going into a club and buying 5 bottles and pissing it away.. you dont get anything in the long term

woj · 01-22-2010, 01:32 PM

Quote:

Originally Posted by xxweekxx

its not that expensive.. my sister has a house in TN, cost her around $135k, her taxes are like $1k/yr, insurance a few hundred a yr.. maintenance $0 so far in a year.. its not like people make it out to be..

Heres my question: if say you work 9-5, and you can afford $1,500 on living.. are you better off getting a house and using that 1.5k for mortgage, or are you better off spending that $1.5k on rent..

This is a good scenario because thats where majority of americans fit in..

in my scenario, you'll see its a much much better idea to buy given those circumstances

at least from your $1.5k mortgage, a good chunk goes towards your house, so lets say $500 is interest, then the other $1000 is "your" money... while in the rental scenario, the $1.5k is going towards nothing, same thing as going into a club and buying 5 bottles and pissing it away.. you dont get anything in the long term

Maintenance is $0 until one day roof needs replacing, and you are out of 5 grand to replace it... or old pipe bursts and it costs you an arm and leg to repair the damage... it's fun to theorize on gfy, but it's a bitch when real world sets in, something breaks and all of a sudden you are stuck with a huge bill...

for you it may make sense, but it's not for everyone, many people underestimate the costs of owning a house... one problem and they spiral downwards into debt...

xxweekxx · 01-22-2010, 01:35 PM

yeah you are right... never know what could happen

Sly · 01-22-2010, 01:53 PM

Quote:

Originally Posted by xxweekxx

its not that expensive.. my sister has a house in TN, cost her around $135k, her taxes are like $1k/yr, insurance a few hundred a yr.. maintenance $0 so far in a year.. its not like people make it out to be..

Heres my question: if say you work 9-5, and you can afford $1,500 on living.. are you better off getting a house and using that 1.5k for mortgage, or are you better off spending that $1.5k on rent..

This is a good scenario because thats where majority of americans fit in..

in my scenario, you'll see its a much much better idea to buy given those circumstances

at least from your $1.5k mortgage, a good chunk goes towards your house, so lets say $500 is interest, then the other $1000 is "your" money... while in the rental scenario, the $1.5k is going towards nothing, same thing as going into a club and buying 5 bottles and pissing it away.. you dont get anything in the long term

Your sister is lucky, those are very very low taxes.

From the $1500 mortgage, "a good chunk" does not go towards your house. You'll be paying $50 on the principle for many many years. It takes awhile for that to stack up.

If the choice was $1500 on mortgage (and that includes taxes, insurance, maintenance, and long-term maintenance) versus $1500 in rent, sure, go for the $1500 homeownership if that's something you wish to spend time on. But that's pretty lopsided. In many many markets (including the one you are living in right now) renting is going to be quite a bit cheaper than owning.

When I was living in San Diego my rent was $1800 a month, add in the other basic utilities and we are talking around $2100. Now, that house was valued at the time around $400-450k. A mortgage on that would have been around $3000 a month. Property tax was 1.5% I believe, so that's another $200-250 a month. Add utilities and we're already up to $3500 a month and we still haven't figured in homeowners insurance, regular maintenance, and long-term maintenance. Granted the market has changed since I left, you can drop a few of the prices but you will still see it pretty large disparity.

That's an extra $1400 a month that you are spending on basic cost of living. That's $1400 a month you can invest in yourself (school to make more money, vacation, enjoy life, etc.), $1400 a month you can put in your 401(k) or IRA, or $1400 a month you can use to start your own business. Options are limitless.

I think you're ignoring a lot of important numbers, most people do. Like I said, if you are ready and want to buy a house... by all means, go for it. Just don't say it's a great "investment."

fatfoo · 01-22-2010, 02:37 PM

What's wrong with spending mass amounts of cash is this:

People will think you are a gangster who sells crack.

01-22-2010, 01:16 PM	#51
xxweekxx Confirmed User Join Date: Oct 2002 Posts: 6,780	this is a nice chart.. factors in everything.. http://www.nytimes.com/2007/04/10/bu...T_GRAPHIC.html for the most part, buying is better, unless you are going to be there for <2yr i did the math right, and ive spent around $100k in rent since i started renting, maybe a little more.. yet i dont have a house or nada... the same $100k woulda gotten me a small little house somewhere.. __________________ _________________ I am the best

01-22-2010, 01:21 PM	#53
xxweekxx Confirmed User Join Date: Oct 2002 Posts: 6,780	its not that expensive.. my sister has a house in TN, cost her around $135k, her taxes are like $1k/yr, insurance a few hundred a yr.. maintenance $0 so far in a year.. its not like people make it out to be.. Heres my question: if say you work 9-5, and you can afford $1,500 on living.. are you better off getting a house and using that 1.5k for mortgage, or are you better off spending that $1.5k on rent.. This is a good scenario because thats where majority of americans fit in.. in my scenario, you'll see its a much much better idea to buy given those circumstances at least from your $1.5k mortgage, a good chunk goes towards your house, so lets say $500 is interest, then the other $1000 is "your" money... while in the rental scenario, the $1.5k is going towards nothing, same thing as going into a club and buying 5 bottles and pissing it away.. you dont get anything in the long term __________________ _________________ I am the best Last edited by xxweekxx; 01-22-2010 at 01:22 PM..

01-22-2010, 01:35 PM	#55
xxweekxx Confirmed User Join Date: Oct 2002 Posts: 6,780	yeah you are right... never know what could happen __________________ _________________ I am the best

01-22-2010, 02:37 PM	#57
fatfoo ICQ:649699063 Industry Role: Join Date: Mar 2003 Posts: 27,763	What's wrong with spending mass amounts of cash is this: People will think you are a gangster who sells crack. __________________ Send me an email: [email protected]