Originally Posted by
gpapadop
Yes it is different strokes for different folks. It is interesting how you won't see many colleagues of mine saying what I am saying, they want to get a hold of YOUR money because that is how THEY can make some money
Here is my approach, in GENERAL:
-Skills/career/good stable job - Build on skills/Networking/etc.
-6 months emergency fund (Bank Direct, even with the darn $12 monthly fee) Maybe 3 or 4 months if both spouses are working & at least one has a stable job
-Long term retirement/college funding plan w/ plenty of conservative assumptions. Of course, maximizing 401k Plans is non negotiable!
-No debt other than mortgage. Avoid car loans too...have short term funding goals for such short term expenses!
-Keep plugging away. Diversify, keep investment costs low, rebalance in regular intervals (I prefer twice a year but annually is fine) and don't do anything stupid tax wise.
-Windfall or some extra cash and the above are set. Do what make you feel better. If you want to pay towards principal it is FINE. You know what you are getting in return and getting that HUGE moment of being debt free much closer. Yes, interest rates are low. Yes, you COULD probably make more. But it is NOT guaranteed return.
Stuff happens. I can tell you stories of what happened to people (not clients) with the dot bombs & then in late 2008 you will weep to eternity.
And this is my story and am sticking to it.
Now, let's not fog the issue of having no debt at all AND how it affects your credit score and cc churning, cough
I indeed have friends regret
forever that when they had it good in 2000, foolishly not paying off their mortgages with their paper wealth so they could have owned their expensive CA homes debt free, but instead choosing to either keep their paper wealth or margine it to more "investments"... We all know how the story has ended. One of them still does not have much of equity in her CA home. The other still have mortgages and college tuition for his children to worry about despite he now works for GOOG. (decent compensation but not much to talk about in terms of stock option appreciation.)
I also have friends who cashed out their paper wealth, paid taxes AND their mortgages and they became debt free / worry free ever since. This has allowed a couple to pursuit their dreams of changing careers - now the wife is an environment engineer heading a division in Chevron instead of a software engineer and the husband is a freelance consultant including Tivo on his client roster.
Oh, the lady who still does not have much of equity in her CA home, at one time laughed at the choice of a young college grad who cashed out the option at CSCO after 2 years joining the company post graduation, bought a 700K home with cash... That was mid 2000, the bubble just showed the first cracks....
Different strokes for different people indeed. Also some tend to forget that investment return is NOT guaranteed.
Now back to normal programming.
CVS in my county is a mixed bag - 2/3 of them do not even carry the VR. Unlike in other cities, ironically those do not carry VR are in less affluent zones of the county while the few I found carrying the VR are in zones that homes start at 300's, more like 400's being the norm. (given the county's median family income is barely 50K, 300's price tag for a house is by no means cheap.) Folks living in 400K homes certainly would not need a VR and BB to meet their financial needs? Interesting district manager's decision is all I could guess - the district managers of the lower income zones are obviously more afraid of crime... In one CVS all the electrical tooth brushes, teeth-whitening stuff, and even condom, are locked behind glass cases set up in the aisles because of rampant shoplifting...