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Thread: Tough Question

  1. #1
    Nicole
    Guest

    Default Tough Question

    We are "planning" on moving next spring (if our home sells). If we

    rent (hopefully we can find a place that won't care we have 5 kids

    and a dog..hmmm) we could pay off our student loans in 3 years

    ($152,000) after the sell of our current home, large sign on bonus

    and saving exvery month. Would you either

    1. Put a down payment on a home and buy, take several years to pay

    off the student loan and about 10 years to pay off the house OR



    2. Rent for 3 years and pay off the student loan, then buy a home and

    try to pay it off asap.



    On one note we are moving to a new area. My husband is visiting

    Arizona the northern area, central and southern in 1 week trying to

    find the ideal area. It is possible even if we bought a home that we

    may not like the area once we stayed there. That is why I think

    renting might be a better choice, as we are not stuck somewhere. We

    could also buy land after we pay off the student loans and pay that

    off and build a house just what we want (modest but including all the


    attributes we would appreciate).



    Nicole








  2. #2
    Suzi McMullen
    Guest

    Default Tough Question


    If it were me I'd rent for the reasons you mentioned. At least for awhile. But as for what to do with the monthly savings.. I'd divide between the 2 goals. Because the student loans are low interest, I think it's very important that you work on getting your savings built up towards the goal of buying or building a house.

    We have followed 2 jobs to other states, New York and California. In each case the jobs did not last but 3 years each time. So buying a house was a major pain when it came to having to move again. Seems to me that you would be better off to at least wait long enough to make sure that your situation is solid.

    Suzi
    [quote]
    ----- Original Message -----
    From: Nicole
    To: Budget101_@yahoogroups.com
    Sent: Saturday, August 02, 2008 2:10 AM
    Subject: Budget101.com : Tough Question





    We are "planning" on moving next spring (if our home sells). If we
    rent (hopefully we can find a place that won't care we have 5 kids
    and a dog..hmmm) we could pay off our student loans in 3 years
    ($152,000) after the sell of our current home, large sign on bonus
    and saving exvery month. Would you either
    1. Put a down payment on a home and buy, take several years to pay
    off the student loan and about 10 years to pay off the house OR

    2. Rent for 3 years and pay off the student loan, then buy a home and
    try to pay it off asap.

    On one note we are moving to a new area. My husband is visiting
    Arizona the northern area, central and southern in 1 week trying to
    find the ideal area. It is possible even if we bought a home that we
    may not like the area once we stayed there. That is why I think
    renting might be a better choice, as we are not stuck somewhere. We
    could also buy land after we pay off the student loans and pay that
    off and build a house just what we want (modest but including all the
    attributes we would appreciate).

    Nicole





  3. #3
    Karen
    Guest

    Default Tough Question

    A few things come to mind real quick.



    1. Is it wise to buy a house when you might not stay? Selling houses

    isn't real easy right now.



    2. Maybe just take the money - put it into savings and hold off any

    decision for awhile. Put the majority of it into a CD or something

    where you can't nickel and dime it to death. Then in say 6 months or a

    year - take a look at where you are and what's happening in your life

    and make your decision then. KarenMO
















  4. #4
    Charlotte
    Guest

    Default Tough Question


    <font size="2" color="teal" face="Comic Sans MS">10.0pt;font-family:"Comic Sans MS";color:teal;">I would rent
    the 1<sup>st</sup> year, then buy. Work on the student loans, but they are
    rally low interest, so take your time with them – don’t rush paying
    them off – maybe pay $50 extra a month. So really – I would go for
    a deferred option # 1.






    From:
    Budget101_@yahoogroups.com [mailto:Budget101_@yahoogroups.com] On Behalf Of Nicole

    Sent: Saturday, August 02, 2008
    2:10 AM

    To: Budget101_@yahoogroups.com

    Subject: Budget101.com : Tough
    Question




    We are "planning" on moving next spring (if our home sells).
    If we rent we could pay off our student loans in 3 years ($152,000) after the
    sell of our current home, large sign on bonus and saving exvery month. Would
    you either

    1. Put a down payment on a home and buy, take several years to pay off the
    student loan and about 10 years to pay off the house OR

    2. Rent for 3 years and pay off the student loan, then buy a home and try to
    pay it off asap.




  5. #5
    Shelly Billingsley
    Guest

    Default Tough Question

    I would pay off the student loans and rent an inexpensive place for a while. I believe your haouse is the last debt you should pay off-so get to paying off those student loans. Low interest or not, debt is debt!!
    Shelly

    ----- Original Message ----
    From: Charlotte <carmstr1@sbcglobal.net>
    To: Budget101_@yahoogroups.com
    Sent: Sunday, August 3, 2008 2:33:46 PM
    Subject: RE: Budget101.com : Tough Question







    <font color="teal" face="Comic Sans MS" size="2"> 10pt;color: teal;">I would rent
    the 1<sup>st</sup> year, then buy. Work on the student loans, but they are
    rally low interest, so take your time with them – don’t rush paying
    them off – maybe pay $50 extra a month. So really – I would go for
    a deferred option # 1. <font color="navy" face="Arial" size="2"> 10pt;font-family: Arial;color: navy;">
    <font face="Times New Roman" size="3"> 12pt;">
    <hr tabindex="-1" align="center" size="2" width="100%">

    <font face="Tahoma" size="2"> 10pt;font-family: Tahoma;font-weight: bold;">From:<font face="Tahoma" size="2"> 10pt;font-family: Tahoma;">
    Budget101_@yahoogro ups.com [mailto:Budget101_ @yahoogroups. com] <span style="font-weight: bold;">On Behalf Of Nicole

    <span style="font-weight: bold;">Sent: Saturday, August 02, 2008
    2:10 AM

    <span style="font-weight: bold;">To: Budget101_@yahoogro ups.com

    <span style="font-weight: bold;">Subject: Budget101.com : Tough
    Question
    <font face="Times New Roman" size="3"> 12pt;"> <font face="Times New Roman" size="3"> 12pt;">We are "planning" on moving next spring (if our home sells).
    If we rent we could pay off our student loans in 3 years ($152,000) after the
    sell of our current home, large sign on bonus and saving exvery month. Would
    you either

    1. Put a down payment on a home and buy, take several years to pay off the
    student loan and about 10 years to pay off the house OR

    2. Rent for 3 years and pay off the student loan, then buy a home and try to
    pay it off asap.





  6. #6
    Jo Ann Brown
    Guest

    Default Tough Question

    Hello,



    I'm a newbie. Ownership is better than loanership. Never consider

    renting even if it is temporary. Renting means throwing away money.

    Money being paid for rent to help build equity in your home. Beware

    of large salaries. The economy is bad and companies are closing

    their doors - going out of business. This is an article I've written

    that you may find interesting.



    Living on Half







    Budgets help you identify goals and help you plan for the future.

    People generally spend every dime of their take home pay. But, what

    would happen if you established a goal of living off of half of your

    take home pay?



    This is not an impossible task. It takes planning and commitment.

    Planning requires you identify a budget that only uses half of your

    take home pay and commitment requires you to stick to the plan.



    Needs and wants dictate how we spend money. The goal of treating

    your basic expenses such as rent/mortgage, food, utilities,

    allowance, and insurance as your primary needs will help you

    understand how you are wasting money on your wants. Your needs can't

    change but your wants can be adjusted.



    Theoretically, let's take $300, assuming this is half of your take

    home pay, and see how we can acquire more when we incorporate

    disciplined savings into our budgets. First we will have 6 accounts

    and allocate $50 to each.



    Vacation - $50 Emergency

    Fund - $50



    Major appliance - $50 Child's

    College Fund - $50



    401(k) - $50 IRA - $50



    Managing and redirecting your current wants will enable you to have

    greater accomplishments. Your current wants are also known as your

    short term goals. They are usually are inexpensive to obtain and

    only provide temporary satisfaction. A new purse or a new pair of

    shoes may satisfy a current want but it will only be replaced by a

    similar want in a very short period of time.



    Saving half of your take home pay allows you to acquire bigger

    wants. Defining and classifying saving goals help you achieve short

    term and long term goals. Discipline will be learned when you

    allocate money to multiple savings objectives.



    Taking the monies saved for vacation. Based on a biweekly pay

    period, you will have $1300 for vacation. This may not be enough to

    take the vacation you currently want. You know that if you save for

    a few more years, this vacation is attainable. A vacation is a

    luxury that is never planned for in the average budget.



    You will not only have your money working for you, but you will also

    gain by accruing interest, dividends, and capital gains. If you open

    an account in a bank, you will only have compound interest. This may

    be adequate for your vacation and emergency fund saving objective.

    However, if you purchase a mutual fund, you will gain more by

    receiving dividends and capital gains. Your child's college fund,

    your 401(k), and an IRA may not be used for 20 � 30 years later.



    Saving half of your take home pay may be a bridge too far at this

    time. It can, however, become an aspiration. Setting high goals

    that are unattainable gives you something to work toward. When you

    fall short of reaching this bigger goal, you will be that much

    farther ahead. In other words, your objective is to save half but

    you were only able to save 30%. That's still good. It's better than

    setting a goal of saving 10% and only saving 3%. The higher you set

    you goal, the better off you will be.







    Most people have encountered a problem that required them to live off

    of half of their money.



    Divorce



    Child Support



    Job lay-off



    Wife quitting to raise family



    Continue living as if the income was not there.



    Jo Ann



    --- In Budget101_@yahoogroups.com, "Charlotte" <carmstr1@...> wrote:

    >

    > I would rent the 1st year, then buy. Work on the student loans,

    but they

    > are rally low interest, so take your time with them - don't rush

    paying them

    > off - maybe pay $50 extra a month.






  7. #7
    Suzi McMullen
    Guest

    Default Tough Question

    If I tried to live on half my income my creditors would force me into bankruptsy

    in 6 months to a year. I've never paid them late or not at all and I certainly

    don't plan on doing that now.



    There comes a certain time when a person needs to make hard choices I realize.

    But so long as I am able bodied I won't live without my cell phones (4 for the

    family), cable television and highspeed internet. If I got rid of all of that I

    suppose I could have 300 bucks to put someplace else. But guess what? There is

    NO WAY to put a price on the peace of mind I have that myself and my family have

    these cell phones. And the television and cable is what makes working 7 days

    per week, 24 hours per day possible.



    I think too many of these ideas people throw around may work for younger people

    that have not had time to make too many mistakes yet. I laugh out loud when I

    hear someone complain of being 3000-5000 in debt LOL! I only wish!



    Suzi

    ----- Original Message -----

    From: Jo Ann Brown

    Subject: Re: Budget101.com : Tough Question



    Hello,



    I'm a newbie. Ownership is better than loanership. Never consider

    renting even if it is temporary.






  8. #8
    Ann Garner
    Guest

    Default Tough Question



    >I think too many of these ideas people throw around may work for

    >younger people that have not had time to make too many mistakes

    >yet. I laugh out loud when I hear someone complain of being

    >3000-5000 in debt LOL! I only wish!

    >

    >Suzi

    Szui, I was amazed when you said it didn't bother you to be $50,000

    in debt. If you are paying 8% interest on that money, you are

    handing over $4,000 a year to those people. Right now, I hate being

    $2,000 in debt. I want that interest money for me. I'll be out of

    debt by the end of this year, though.

    Ann in Arkansas










 

 
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