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      09-24-2010, 11:39 PM   #23
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Correct me if I'm wrong but isn't "mileage" meant to compensate you for money out of pocket, meaning that you have spent money to travel and they are paying you back based on your expense report and should be a net wash?
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      09-24-2010, 11:51 PM   #24
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Correct me if I'm wrong but isn't "mileage" meant to compensate you for money out of pocket, meaning that you have spent money to travel and they are paying you back based on your expense report and should be a net wash?
It's supposed to compensate for gas, wear and tear, etc. We get paid the federal rate for mileage (when I did my internship it was $0.55 a mile, but now I think its around $0.45) plus any toll fees. But with BMW free maintenance I don't really have any maintenance costs, and it sure doesn't cost me $0.50 a mile in gas, so I make it out on top most of the time. And since I live about 4 miles from the office, I get paid for nearly all my driving.
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      09-25-2010, 02:29 AM   #25
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25-75,000
30-200,000
35-400,000
40-800,000
50-2,500,000
not including any real estate equity
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      09-25-2010, 10:51 AM   #26
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I'm doing everything in my power now (at 26) to ensure I am a multi-millionaire in the future! The problem is, at least in my opinion is that buy and hold strategies simply do not work anymore. With algos and quants running trading, seems a bit disconcerting for us retail investors to have any real shot at making "above average" risk-adjusted returns.

I shifted my focus more towards total return now, I think the big dividend paying stocks are the best way to earn a little juice in this market.
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      09-25-2010, 02:21 PM   #27
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Wife and I are both 27. We have about $20k in our various easily accessable banking accounts. I have another $4k with some stocks and a roth IRA. My wife has about $8k coming from her previous employers stock match account coming to us as she just changed jobs. We both have another $7-10k in combined in our 401k's.

We have $63k left on our home loan. $19k left on our auto loan. No school loans or CC bills.


For you e90posters a quick question. We have been very aggressive in paying off our home loan by doubling our mortgage payments. At our rate we have about 3 years left to paid off coupled with no extra payments on the car and 3 years left as well. My question is how should we proceed?

1. Continue with accelerated mortgage payments and be scott free of both loans in 3 years, then begin to aggressively save.

2. Slow down our home payments to keep the tax deduction and pay off the house in 5-8 years and take the money we have been paying over monthly and save it now.

Paying off the car faster only saves $1,300 in interest. Paying of the house faster saves $10k or so but what about the tax purposes?

What do you guys think?
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      09-25-2010, 02:48 PM   #28
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Quote:
Originally Posted by darkcloud View Post
Wife and I are both 27. We have about $20k in our various easily accessable banking accounts. I have another $4k with some stocks and a roth IRA. My wife has about $8k coming from her previous employers stock match account coming to us as she just changed jobs. We both have another $7-10k in combined in our 401k's.

We have $63k left on our home loan. $19k left on our auto loan. No school loans or CC bills.


For you e90posters a quick question. We have been very aggressive in paying off our home loan by doubling our mortgage payments. At our rate we have about 3 years left to paid off coupled with no extra payments on the car and 3 years left as well. My question is how should we proceed?

1. Continue with accelerated mortgage payments and be scott free of both loans in 3 years, then begin to aggressively save.

2. Slow down our home payments to keep the tax deduction and pay off the house in 5-8 years and take the money we have been paying over monthly and save it now.

Paying off the car faster only saves $1,300 in interest. Paying of the house faster saves $10k or so but what about the tax purposes?

What do you guys think?
The tax write off is overrated, IMO. I'd refi your home loan depending on your current rate and save/invest more. If you believe the economy is recovering, a bull market could run the dow back to 13k or so (perhaps wishful thinking).
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      09-25-2010, 02:52 PM   #29
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Quote:
Originally Posted by darkcloud View Post
Wife and I are both 27. We have about $20k in our various easily accessable banking accounts. I have another $4k with some stocks and a roth IRA. My wife has about $8k coming from her previous employers stock match account coming to us as she just changed jobs. We both have another $7-10k in combined in our 401k's.

We have $63k left on our home loan. $19k left on our auto loan. No school loans or CC bills.


For you e90posters a quick question. We have been very aggressive in paying off our home loan by doubling our mortgage payments. At our rate we have about 3 years left to paid off coupled with no extra payments on the car and 3 years left as well. My question is how should we proceed?

1. Continue with accelerated mortgage payments and be scott free of both loans in 3 years, then begin to aggressively save.

2. Slow down our home payments to keep the tax deduction and pay off the house in 5-8 years and take the money we have been paying over monthly and save it now.

Paying off the car faster only saves $1,300 in interest. Paying of the house faster saves $10k or so but what about the tax purposes?

What do you guys think?

Is the only reason you would think to slow down on the mortgage payment is for the tax benefit? Lets try to see what the benefit is.

I'm going to assume some rough numbers just for an example. Lets say you and your wife file as married filing joint and your taxable income falls in the 15% bracket ($16,751 - $68,000). And even though that $10,000 extra interest you'll pay will not be evenly spread out over the extra 5 years (8 years if slow down payments - 3 years at current pace), lets assume it is. So if you DON'T pay off your mortgage faster then each year you'll have a itemized mortgage interest deduction of about $2,000. Lets pretend that before this and net of all your personal exemptions and the rest of your itemized deduction your taxable income is $65,000. So the mortgage deduction would reduce your taxable income to $63,000. That means your tax liability will be $8,612 using 2010 tables. If you don't take that deduction then your tax liability will be $8,912. So you are only saving $300 per year by extending the mortgage. Over those 5 extra years you'll only have a total savings in taxes of $1,500, but to get that you had to incur an extra $10,000 in interest. So you ended up -$8,500. Obviously these numbers are just an example and your actual situation will be different, but it illustrates the point.

If you are in the 25% range, then it's yearly affect would be $500 (assuming that the 10,000 is spread evenly). So in five years you have a tax savings of $2,500, but a increased interest expense of $10,000 for a net gain of -$7,500

I would pay off the mortgage and not worry about the interest deduction since it is so minimal.
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      09-25-2010, 03:08 PM   #30
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Quote:
Originally Posted by Seminole View Post
Is the only reason you would think to slow down on the mortgage payment is for the tax benefit? Lets try to see what the benefit is.

I'm going to assume some rough numbers just for an example. Lets say you and your wife file as married filing joint and your taxable income falls in the 15% bracket ($16,751 - $68,000). And even though that $10,000 extra interest you'll pay will not be evenly spread out over the extra 5 years (8 years if slow down payments - 3 years at current pace), lets assume it is. So if you DON'T pay off your mortgage faster then each year you'll have a itemized mortgage interest deduction of about $2,000. Lets pretend that before this and net of all your personal exemptions and the rest of your itemized deduction your taxable income is $65,000. So the mortgage deduction would reduce your taxable income to $63,000. That means your tax liability will be $8,612 using 2010 tables. If you don't take that deduction then your tax liability will be $8,912. So you are only saving $300 per year by extending the mortgage. Over those 5 extra years you'll only have a total savings in taxes of $1,500, but to get that you had to incur an extra $10,000 in interest. So you ended up -$8,500.

I would pay off the mortgage and not worry about the interest deduction since it is so minimal.
The only thing your off on is we make above $68k combined. Not a hell of a lot more but also not over $100k, somewhere inbetween. Oh and our agent ran the numbers last year and we filed married filing seperate.

Anyways, I was kind of assuming that outcome. We've been very aggressive as it is and we're almost to the point that we're paying mostly towards principle.

There are also a few other issues. The wife took a new job and a pay cut for the year. Which then she'll get a pay increase next year above her salary this year, and then another and another for the next 4 years. Fairly decent jumps. I on the other hand dropped $20k this past year in pay, which royally blew haha. Which was mainly the reason we thought of dragging out our motgage slightly as well as the tax write off. We just weren't sure which made more sense. We can continue fairly easily at our payments even with our salary setbacks we just may have to be a little lean on personal expenses and savings. We could also just play the mortgage payment by ear each month depending on what comes up.

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      09-25-2010, 03:18 PM   #31
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The only thing your off on is we make above $68k combined. Not a hell of a lot more but also not over $100k, somewhere inbetween. Oh and our agent ran the numbers last year and we filed married filing seperate.

Anyways, I was kind of assuming that outcome. We've been very aggressive as it is and we're almost to the point that we're paying mostly towards principle.

There are also a few other issues. The wife took a new job and a pay cut for the year. Which then she'll get a pay increase next year above her salary this year, and then another and another for the next 4 years. Fairly decent jumps. I on the other hand dropped $20k this past year in pay, which royally blew haha. Which was mainly the reason we thought of dragging out our motgage slightly as well as the tax write off. We just weren't sure which made more sense. We can continue fairly easily at our payments even with our salary setbacks we just may have to be a little lean on personal expenses and savings. We could also just play the mortgage payment by ear each month depending on what comes up.


Yeah, I added in edit numbers for the 25% MFJ bracket, but since you file separate I'd have to redo everything. Regardless, it's a pretty nominal tax savings. The only reason I would extend the payments if it were me was if I could take the extra money and invest it in such a way that it will net out the extra $10,000 in interest and leave me with a profit. If you put it into investments or savings that earn less than the increased cost of $10,000-tax savings it wouldn't be really worth it. For the best advice, I would ask your tax preparer or financial adviser since they know your situation better than any of us here do!
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      10-04-2010, 07:54 PM   #32
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Anyone else?
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      10-04-2010, 10:49 PM   #33
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And then came the hyperinflation and washed it all away....
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      10-04-2010, 11:24 PM   #34
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holy crap im 28 and im at -200k
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      10-05-2010, 12:09 AM   #35
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Quote:
Originally Posted by darkcloud View Post
Wife and I are both 27. We have about $20k in our various easily accessable banking accounts. I have another $4k with some stocks and a roth IRA. My wife has about $8k coming from her previous employers stock match account coming to us as she just changed jobs. We both have another $7-10k in combined in our 401k's.

We have $63k left on our home loan. $19k left on our auto loan. No school loans or CC bills.


For you e90posters a quick question. We have been very aggressive in paying off our home loan by doubling our mortgage payments. At our rate we have about 3 years left to paid off coupled with no extra payments on the car and 3 years left as well. My question is how should we proceed?

1. Continue with accelerated mortgage payments and be scott free of both loans in 3 years, then begin to aggressively save.

2. Slow down our home payments to keep the tax deduction and pay off the house in 5-8 years and take the money we have been paying over monthly and save it now.

Paying off the car faster only saves $1,300 in interest. Paying of the house faster saves $10k or so but what about the tax purposes?

What do you guys think?
Here:

http://zwicke.nber.org/refinance/index.py
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      10-05-2010, 12:38 AM   #36
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holy crap im 28 and im at -200k
negative 200k? wtf?
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      10-05-2010, 01:19 PM   #37
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I'm 23. Just moved to Boston for a new job.

...living way beyond my means and cleaning out my savings month to month.

Go me!
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      10-05-2010, 01:52 PM   #38
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I'm 29 and married for 8 years. so here our net worth.

25 - $10,000
29 - $200,000 - in process of quitting my IT job and open a business
31 - $500,000 - tell wife to quit her nursing job and help me out
35 - $1000,000 - expand business
40 - $5,000,000 - expand business
45 - $10,000,000 - retire

man, i wish i do good with my business. LOL
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      10-05-2010, 08:02 PM   #39
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Man, this hyperinflation actually scares me some.
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      10-05-2010, 08:10 PM   #40
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That is almost impossible to to answer. It would depend on education (undergrad, grad doc etc,), job choice, loans (student etc.), socio-economic background or family,health, and probably a few others. What you should look to do is a per cent of you income, usually around 10-15%. If you are living with-in your means, which very few people do, you should be okay in saving for the future
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      10-05-2010, 08:15 PM   #41
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I have not come across one source I would trust to forecast such complex price movements projecting a period of hyperinflation for the US
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      10-05-2010, 08:39 PM   #42
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25- 20k
30- 60k
35- 150k
40 win lotto and retire
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      10-05-2010, 08:50 PM   #43
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25-75,000
30-200,000
35-400,000
40-800,000
50-2,500,000
not including any real estate equity
Only the privileged.
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      10-05-2010, 10:05 PM   #44
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Only the privileged.
His assessment seems doable.
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