Overheard conversation!!!!

[mopardude318]

Wow!! Then that makes me one of the truly lucky ones. Moved down from Alaska in '82 with a fist full of money and used it to build our house here. The day we finished the house(Panabode) - we didn't owe a single cent to anybody. Started in July of '82 - completed in November of '82.

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wow. Very nice place you have there!

 

[DrRod]

Conversely, most of the young folks I know don't care much about cars. Driving isn't as much fun as it used to be and cars have become homogenized a great extent. When I was a kid you could cruise down the 2-lane blacktop and it was like being in a commercial. Now when I see an ad bragging about horsepower I just wonder how it idles in traffic. When was the last time you saw a new Corvette?

My kids all wanted houses as soon as they got married -- understandable. But I encouraged them to wait until they got their second or third job. Owning a house can limit your flexibility and mobility. And increased value is by no means assured. There's better investments.

One of the reasons houses went up so much in the last 30 years was [a] baby boomer buying pressure -- now done; and houses grew dramatically in size and features. When was the last time you saw a new house with only three bedrooms and one bath? And now many houses have sprinkler systems, radon systems, gas fireplaces, decks, automatic garage doors, ice makers, fancy washer/dryers, finished basements, etc. which 30 years ago were rare luxuries. Most people finished their basements and added decks/patios after being in a house a good while. And consider the quality of insulation, windows, doors, and roofing. Yes housing went up but there was a lot more to be paid for.

Renting can still make sense especially if you save the extra money and invest it wisely.

 

[MossRoad]

I have a 55 year old friend. He's married to a doctor. They live in a large 4000ish square foot house on 5 acres in a gate community. They have 5-6 large TVs, drive used BMWs (he's a luxury used car salesman), have 5-6 Italian hounds, eat out all the time, toys, vacations, etc.... he's $600K in debt. Doesn't care. His reasoning? He doesn't have kids, no one to leave anything to, so he's basically renting all these toys and making minimum payments. When he tires of them, he just returns them.

 

[Einthewoods]

How the heck did you overhear me talking about my jetski purchase.....of wait never mind.

We see this kind of behavior all the time now though. It isn't just pathetic for them, but it costs us all money. Either through higher fees and interest rates for the banks to make up the money lost on these people (once they default) or the general costs of things being artificially high to recover loss and legal fees.

This behavior is in the same camp with people on government assistance with a boat and snowmobiles in the driveway. Or a shopping cart at the register full of junk food and pop, and out comes the government SNAP/EBT card.

Ticks me off every time I see my pay stub and how I am funding others.

Anyhow....I am going to go get another cup of coffee and let the blood pressure go back down.

 

[tomplum]

Things like title loans, are they legal yet? When I was living in town years back, a piece of paper blew into my yard. The paper was someones title loan sheet, which showed an interest rate of over 900%! I never thought I'd actually see anything that crooked.

 

[CobyRupert]

On ski lift yesterday at about 3:30. Group of 5 young adults who of course break out their phones. One is talking to a friend who was apparently also at the mountain. “Yeah, we’re skiing now, but can meet you in the bar afterwards, we’ll probably ski here until 6:00.”
Huh? It gets dark here a little after 5:00. It’s pretty standard that most ski mountains close at 4:00. There’s not a spotlight to be found anywhere, which is apparent if you put down your phone and look. All 5 of them were surprised, 6 people including the friend on the phone, who had no clue about what happens when that orange shiny ball in the sky goes low.

 

[EddieWalker]

I have a 55 year old friend. He's married to a doctor. They live in a large 4000ish square foot house on 5 acres in a gate community. They have 5-6 large TVs, drive used BMWs (he's a luxury used car salesman), have 5-6 Italian hounds, eat out all the time, toys, vacations, etc.... he's $600K in debt. Doesn't care. His reasoning? He doesn't have kids, no one to leave anything to, so he's basically renting all these toys and making minimum payments. When he tires of them, he just returns them.

My ex was a title officer and she mostly did two things. Title searches on mobile homes for a couple of the bigger local companies, and refi's for high end homes. The mobiles where all bought by people with very low incomes. The owners of the companies plan on repossessing them three times. They know that when they sell it brand new, that they will be taking it back, then selling it again, and again until it's pretty much worthless. It's how their businesses plan works.

The high end homes surprised me. There are a lot of people with significant incomes that cannot control their spending and it's a battle of outdoing each other. Some have incomes in the tens of thousands of dollars each month, but they are at risk of not having enough to pay their mortgage without a break of a month or two, so they refinance the loan to get that break. It's a death spiral that cannot end well. The house that I'm working on right now for a client was in a similar situation. Her husband was a well known surgeon in the area who passed away, she never had a job and didn't understand how to budget her money, so she ran out of cash, then borrowed more against the house until she had to sell it to pay off the debt. She is now flat broke and living with family. It's a big, fancy house on the lake in a very desirable area that was falling apart and my client picked it up for $600,000 cash because the banks wouldn't finance a house in that condition. They put another hundred into it and plan on living there for at least five years. It will easily sell for a million when they are done with everything.

 

[Raspy]

Two of the younger generation:
If I miss a payment on the car and the boat I'll have enough for a deposit on a jetski.
Ye Gods, what is the world coming to?

This one statement is hardly indicative of ALL the younger generation, but thinking like this does lead to hard lessons or a harder life, and it gives the smarter ones an easier time when competing.

The opposite of this is the depression era generation, who decided to never take any chances and never spend any money unnecessarily. That thinking leads to a long poor life too. My father, for instance, always wanted to work an hour for an hour's pay. Never wanted to invest in property that would send him into debt, temporarily. Consequently, he was always on a strict budget and could never grasp the risk he was taking by not having financial security or the risk associated with working a physical job and commuting on the highway for many years for a few dollars each day. Meanwhile all the property around him continued to go up in value his entire life, and eventually he became too weak to work.

 

[turnkey4099]

Worked as trainer/correctional officer in local jail. Usual procedure for Criminal Justice majors right out of college was to get a job there. More than one of them showed up on day 3 or 4 a fully loaded SUV or 1/2-3/4 ton truck.

I had one older one who lived by credit card and was trading for new cars (never satisfied with the previous one), had his water and power turned off more than once. I told him "You are only one pay check away from losing everything you have". "It's my life styie". Last truck he traded for he had trouible finding financing. One dealer told him he was $23,000 upside down on a loan. Didn't [phase him a bit. He showed up with the next new one a week later.

 

[Larry Caldwell]

I cringe every time I hear the credit repair commercial that starts out "Don't let the credit card companies TRICK you into thinking you have to pay it all back".

We have a dynamite train on a downgrade again, with over $1 trillion in credit card debt and $1.3 trillion in student loan debt. The boom has been fed with plastic, and the next crash is going to be just as ugly as the last. A lot of those young people won't even be able to live in their $60k luxury car, because the repo company will take it.