[Sigma]

Originally Posted by TESLAASTRO

I have no proof, but i would imagine a 100k+ goes a long way in Nebraska....I wonder what you could buy house-wise for 250k?property taxes?....from whhat I read, Lincoln's a nice place to live (apart from the cold harsh winters)

I've actually only very recently moved to Lincoln. I was in the DFW area of Texas for a little while. And you'd probably be surprised -- money doesn't go as far here as it does there. Property costs a good 25% more, food prices are higher, gas prices are very high, taxes are friggin' outrageous (Texas is one of the lowest-tax places to live in the nation, Nebraska actually one of the highest). All-in-all, I'd say my purchasing power is a good 15% less here in than it was in Texas.

if you want to be wealthy (someday), make a policy of never buying depreciating items with credit. period. another good rule is to not buy a house that is more than twice your gross pretax income.

Well, I'm a fervent believer in using other people's money whenever it's cheaper than using my own.

I can use my own money and easily make 10% on it in a year. In fact my annualized return on investments from the past 5 years is 27%. Now, I know that statistically-speaking that is bound to reverse or at least trend way down. But it should average out to something in the 8-10% range over time.

Considering that I can borrow money for a car in the 5% range, and it doesn't make a great deal of sense to me to use my own cash when I can use someone's else's while keeping mine to earn me money. As a matter of fact, given my return on investments, instead of paying $40,000 cash for a car, I can make the payments just off the interest I'm earning on that money in my portfolio. So, essentially, that car is "free".

If I went and paid cash, not only do I lose the $40,000, I also lose the earnings on that $40,000. If I had paid $40,000 cash for a BMW 5 years go I would have lost $92,000 in earnings that $40,000 generated me over that same time period. $132,000 is a lot of money for a BMW.

It is of course a guessing game. You don't always net a return on your investments. But, generally speaking, it's not terribly difficult to exceed the interest rate on the car. In fact, thesedays you can get high-interest savings accounts that will net you about what you'd pay in interest on a car loan. That way you're still borrowing the money for "free" (since it's earning you what you're paying in interest) but you've also still got the $40,000 in the bank in case a rainy day comes along and you really need that cash.

What are you doing in Lincoln to make that Sigma if you don't mind me asking?

I've worn a lot of hats in a short number of years but I essentially do mechanical & industrial engineering work. I work for a railroad now but I've also worked in the automotive industry, and when there wasn't enough horsepower there I moved to the locomotive industry. 4400 horsepower of turbo-charged diesel ground-shaking goodness ***Tim Allen grunt***