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Sure- or I could take my financial economics degree, series 7 license and experience in the financial industry in addition to my own experience and tell you that limiting yourself isn't the most efficient method. Of course if you're entirely risk averse finance wouldn't be your cup of tea but for most of us the idea of owning our own house, car, bike, boat etc when we want is fairly important. For instance, if I weren't only in this area temporarily I would go into debt buying a house because the rate I get on a $500k house is about $100 more per month than what my friends and I are paying for an apartment. Then all that money I spend on the house builds as equity.

To take it further after a few years I can start leveraging the money built up in the house to buy another house which I could rent out and have more equity building. If I ever got into dire straights I could always sell the second house and still be coming out on top. Sure a slow market could be a hindrance or my tenents could have torn things to "poo poo" but with good planning, an eye on the horizon and a clause or two in the contract and I'm set.

I've seen people sell financial products, advice, services, investments etc etc etc. I can smell a seller, I can smell opportunity but honestly I moved past the no debt idea a long time ago. If you don't think it's effective, why do banks do it everyday? Federal law only requres them to have X percent of the amount of money they loan out on hand. Every time you open a checking account you give them the ability to loan out a magnitude of roughly 5 times what you put into the account. And if you think that doesn't cost them big every once and awhile then you've never heard of the Repurchasing market for banks in trouble.

^^ pretty well covers it.

I'm just chiming in to echo that USAA does in fact rule. They've got my insurance, savings, checking, *gasp* credit card and *shock horror* loan. Little secret - if you're out to establish good credit history - try not taking buying things you can afford w/ cash on credit. If I need to settle my loan tomorrow I can, and will. Ditto my CC.

It's always nice to be able to cover anything and that's generally the way I rock it.

USAA also has the amazing debit card that works 10 times a month at any ATM with no overdraw fee (they reimburse you for it). It is by far the coolest thing ever. My only regret is that I only have access to it because my dad did and I'm the first generation in my family to never serve.

storysunfolding wrote:It's always nice to be able to cover anything and that's generally the way I rock it.

USAA also has the amazing debit card that works 10 times a month at any ATM with no overdraw fee (they reimburse you for it). It is by far the coolest thing ever. My only regret is that I only have access to it because my dad did and I'm the first generation in my family to never serve.

+1 for USAA.

I could retaliate against your previous comment, but it'd involve typing up a whole chapter I don't feel like typing, and it's not going to persuade you to think any different. If it works for you, that's great. Personally, I'd rather stay out of debt, because at my age I'm likely to get into trouble. These books are here to get people who are $10,000, $30,000, even $100,000 in debt out of debt. My parents went through something like that and don't want me to do it, so they nipped the problem in the bud.

If you're happy wasting away your money then do it. If it works for you than do it. It doesn't work for everyone, though.

PS. is it a good financial move to finance depreciating assets? You're using houses which build equity. How would you get out from under the burden of a home that depreciated? Did you know that homes in some areas do depreciate in value?

When you rent the house out, someone else's money goes towards the note... it's fairly self explanatory from there but yes like any investment you need to know when to get in and when to get out. I would never buy real estate in say Wynne Arkansas, but even with the market cooling off I'd be a fool not to buy real estate inside the beltway in Northern Virginia especially if I want to rent out units. Growing population, increasing traffic and proximity to D.C. mean that even with my properties value decreasing, I can still raise the rent every year.

And yes managing your finances is a responsibility that many people, especially younger people simply aren't mature enough to do. So if you can't make or keep to a budget, or realize how much you're spending or take time to consider your financial position then sure, limit yourself to cutting coupons and wondering where all that money you spent on rent over the last 5 years went. I however realize that if I stay here for 5 years and for some amazing reason they don't rasie the rent I'll have spent $132,000.

wow!! you could rent our governors mansion for 5 years for $132,000.

Yeah- this area is expensive. Granted it's a 3 bedroom 2 bath apartment but $2200 a month isn't something to sneeze at. But with my room mates my share of rent, the car/bike insurance, monthly gasoline bill and utilities are all less than a weeks pay. So give me a year and I'll have more than enough saved to drop a hefty downpayment on a house with an appropriate garage for storing and working on the bikes. Then maybe I'll get that shiny new M50 I'm always coming here to talk about... even with it's fugly front wheel


Priorities right?

talk about a ugly front end.what about that headlight on the m109???

Looks like a schnauzer. It's one of the reasons I'm staying with the m50... that and I could buy the g/f her 650r with the difference

I have a perfect solution to all my debt problems.....


JUST ASK LESKO!!!