The STOKE thread
Everyone is different and I understand that some people aren’t motivated in that regard but living hand to mouth does get old and it would be nice to have some security. Sometimes those attitudes are just a way of justifying someone’s financial position to themselves. I used to think I would probably be dead before 30 and would worry about it when/if I made it as a way of justifying me spending every pay on frivolous shit, alcohol was a major percentage of my outgoings. I’m 33 now and don’t regret it but I see my attitude now for what it was.
I’m 30 and I don’t spend my money on anything frivolous. I am pretty well traveled, educated and I have a bit of savings and no debt. I normally work a few days a week but this semester I am studying more than full-time, so will be lucky to work 1 day a week. In all honesty, my attitude and unwillingness to succumb to the daily grind is probably a reaction to my dad passing at age 58. (I was 21)
My parents worked their butts off to provide for us, buy a house and put us through school and uni and putting off all the fun stuff til they retired and they didn’t get to do any of it. We lived well within our means, and had nothing fancy. I appreciate their sacrifice more than they could know but that is not how I want my life to be. I am happy to only ever earn a little bit more than enough than I need to get by, work less than most, spend time with my kids (whenever and if they turn up) surf when the lineup is empty and have money left over to enjoy my time on this planet while I’ve got it! If I end up having money to buy a house at some point, that’d be great.
We are defiantly are products of our upbringing whether that was right or wrong - good or bad. And i def think I understand you more now Cords. But i think most of us are just saying you should learn a little bit more about the market & such (said with the best love in mind!)
I believe that you can’t spend it when you are dead and think my parents have been too safe (but then again if they weren’t they wouldn’t have bought the house the currently have in Jindy)
Funny story as a teenager I loved display home villages and prior to having a license I used to beg my parents to drive me around. Twice my parents almost bought a new house - thank god they didn’t because when I was 18 they bought the house in Jindy and woudl have not been able to afford it if they had got a new mortgage! (well maybe due to the equity but the timing wouldn’t have be right etc etc)
Not sure exactly where DRC has latched onto 3% gain on property year on year, historically speaking over 10 years most property in metropolitan Australia has doubled in value. Property in my suburb could be bought for $30K in the late 70’s, by the rationale I mentioned right about now that should mean it’s worth about $250K today, that figure is about $700K under the median house price in my area, go figure.
Yeah - my sister bought her place in the early 00’s and it was under 200k - they are about to sell it and i think they are expecting around $800k (give or take $50 - $100k - i will let you all know when she sells! It is going to be sold by the end of the year.)
Sometimes I wish I had bought then (but i was too busy travelling the globe!)
But I have put no money in? You have!
What have I put money into?? I’ve done nothing out of the ordinary but save (which a mortgage really is just a forced savings account where they charge you interest on)
But right now I get more money from my flat than the mortgage - the only thing that makes me negatively gear is the costs associated. (which i am still very close to breaking even)
Without asking how much you have saved it is hard to say
But lets say you have $30k (exactly the cash I would have if I sold today)
And you put no more “extra” cash in each week. I wonder who would have more assets/cash in 10 years?
And the fact of the matter in Australia the banks like my equity vs your cash any day (for future buying power - are you never going to buy?)
So the interest you paid in the years before you became neutral/positive geared are completely ignored (while I was making profit in each of those years?)
Yes because I wasn’t paying some else mortgage/interest!
Unless you were living rent free you can’t compare.
(I would love to know what percentage the combination rent & cash savings was of your income vs mine. Thats the only way we can compare apples with apples IMO)
As I said in 10 years I think I will still be better off and the banks will look more favorably to my assets to your cash nest egg.
Editted cause i didn’t word my question correctly
huh? Surely you had to pay to live somewhere during this time if your investment is tenanted?
I may/may not ever buy it depends on where life takes me and how the economic climate pans out.
The banks view of me is irrelevant as i probably won’t end up needing them. I did however get approval for a loan a few years back when I was looking at buying down at the gong.
This proved to be painful typing on a phone so I’m going to have to step out of this debate for now
Everyone is different and I understand that some people aren’t motivated in that regard but living hand to mouth does get old and it would be nice to have some security. Sometimes those attitudes are just a way of justifying someone’s financial position to themselves. I used to think I would probably be dead before 30 and would worry about it when/if I made it as a way of justifying me spending every pay on frivolous shit, alcohol was a major percentage of my outgoings. I’m 33 now and don’t regret it but I see my attitude now for what it was.
I’m 30 and I don’t spend my money on anything frivolous. I am pretty well traveled, educated and I have a bit of savings and no debt. I normally work a few days a week but this semester I am studying more than full-time, so will be lucky to work 1 day a week. In all honesty, my attitude and unwillingness to succumb to the daily grind is probably a reaction to my dad passing at age 58. (I was 21)
My parents worked their butts off to provide for us, buy a house and put us through school and uni and putting off all the fun stuff til they retired and they didn’t get to do any of it. We lived well within our means, and had nothing fancy. I appreciate their sacrifice more than they could know but that is not how I want my life to be. I am happy to only ever earn a little bit more than enough than I need to get by, work less than most, spend time with my kids (whenever and if they turn up) surf when the lineup is empty and have money left over to enjoy my time on this planet while I’ve got it! If I end up having money to buy a house at some point, that’d be great.
I understand where your coming from and different things work for different people. I resolved to earn more money to fund my ever increasing spending habits, so far so good but my jump in earnings has unfortunately never been of significant magnitude for me to realise a really large surplus and convert it into bricks and mortar asset. These days I wonder how in hell I managed to live out of home, pay off a car loan and drink every weekend on $300 a week when I was 20.
One last thing. Nthn we are talking about the current economic climate. Unless you have a spare delorian 10 years ago isn’t going to help us. Have a look at Japan and America and see how much “historical growth” meant to them. Property bubble blah blah blah
huh? Surely you had to pay to live somewhere during this time if your investment is tenanted?
Yes I currently do but it is less than my mortgage. So straight away I am in front.
But you were saying about when I wasn’t positively gearing.
When i was paying interest I am guessing my interest was less than your rent at the time. (but we need percentage of income to compare apples with apples.).
So you saying i was throwing away the interest (which was what you were implying) I counter that rent money is dead money and so you were throwing away money at the same time I was.
DRC, the point made is that even despite the GFC and the economic recession of the 90’s property has still climbed, the US is a completely different kettle of fish and a redundant argument as no one is planning on buying property there.
lol this is going nowhere each to they own kids. hahah at then end of the day its what ever works for you ...
One last thing. Nthn we are talking about the current economic climate. Unless you have a spare delorian 10 years ago isn’t going to help us. Have a look at Japan and America and see how much “historical growth” meant to them. Property bubble blah blah blah
Actually it was only people who bought recently in those countires (shit can’t think of the financing term that basically gave us the GFC!)
The problem is now americans have house that are worth less than the mortgage.
But if they ride it out they will be fine!
But say people like my parents - if they lived in the states would be fine.
They still would have equity. There house would still be worth double triple what it was when they first bought it.
http://www.nasa.gov/multimedia/nasatv/media_flash.html
NASA coverage of the Mars Lander
DRC, the point made is that even despite the GFC and the economic recession of the 90’s property has still climbed, the US is a completely different kettle of fish and a redundant argument as no one is planning on buying property there.
And if you had cash in a bank acct in the US it wouldn’t be earning 6% interest!
Oh and lots of people lost cash! Their savings weren’t protected like here!
DRC, the point made is that even despite the GFC and the economic recession of the 90’s property has still climbed, the US is a completely different kettle of fish and a redundant argument as no one is planning on buying property there.
things get worse than the 90’s the bigger a bubble grows the bigger the pop but I guess it will be fine as what happens in global economies would never dare effect us…....
I hope you’re right, I would love to pick up a beachfront in Newport for $400K ha ha! Unfortunately there no real impact on Australian house prices during or indeed after the GFC.
DRC, the point made is that even despite the GFC and the economic recession of the 90’s property has still climbed, the US is a completely different kettle of fish and a redundant argument as no one is planning on buying property there.
things get worse than the 90’s the bigger a bubble grows the bigger the pop but I guess it will be fine as what happens in global economies would never dare effect us…....
But if our property market crashes so does your cash! 
(been dying to use an (any) emoticon in this discussion!!)
But not that things wont affect us but it is a well know fact that our economic base point is a lot better than others!
I can’t remember what industry you are in but I worked in Investment Banks for 10 years before my current job(which has still has a foothold in the industry), granted I am not a banker but I asked a lot of questions (particular at the time i bought my flat when i was firmly in the industry) and I am still friends with Bankers who still agree that bricks and mortar is a sound LONG term investment.
Your view is in the minority - sorry.
Yes I am saying there are some people who agree with you but I would say 5%
Sigh put your emoticon away! I could stash my cash under my mattress if i need and it’s got guaranteed to 250k each account I have mine split over two banks. I could just as easily point you to other forums where the majority would be in my camp. Not to worry it was an enjoyable debate. Horses for courses I just think people should realise that there are options and with a bit of discipline you can earn as much if not more bu diversifying and staying liquid rather than have all your eggs in a potentially depreciating asset.
time to dead lift :-(