Entries Tagged 'Real Estate' ↓

This story comes from my friend The Retirement Hobo.  He has really finished working and is now traveling around Asia like a retirement hobo should.  He is sending his friends emails and I really liked this story so I asked him if I could post this story on my blog.  He said YAHHH!!! So here it is!
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Just wanted to share one day with you all.

A few days ago, a friend introduced me to his private mountain.  That’s right, a mountain.  He bought it years ago as an investment property but the license fell through and now he turned it into a farm where he and his family can camp out and eat fresh organic vegetables and tropical fruits he grows and barbecue fresh farmed trout from their pond.

We entered the gate that marked the mountain he owned…that’s right, a mountain…and it was so nice.  The weather was semi-tropical, a slight mist in the air, with the sunset beaming the day’s last rays through the myriad of trees, scattering light onto the stone path.  We drove a few hundred meters and reached his man-made cottage and barn.  There was some ducks and geese chilling by the lake and a bunch of vegetables and fruits growing in an orchard.

One of the fruits, when literally translated from Chinese (neither of us knew the English name) is called the “Fire Dragon Fruit” and was named because of its fire-reddish color that mixed in shades of orange and yellow (kinda like a mango) and it’s skin made it seem like it had scales (kinda like an artichoke).  It grew on a huge cactus that vined around and its flower was a huge tropical-looking red blossom (kinda like that plant that kills you in the movie, Jumanji).

His cottage had electricity and running water somehow (I’m guessing magic), and he put on a hot pot of water to boil some organic fresh tea he picked straight up from the garden.  We took a little hike and he pointed out the pond of fish, a waterfall and a creek, and various small reptiles and lizards.

We settle down on his porch and he tells me to get ready for some show that his magical mountain…that’s right, a magical mountain…was about to start.  He turns off all the lights and we wait.  A steady stream of water, frogs ribits, and other loud insects keeps the silence away while we wait.  Then a flicker of light flashes in the trees…too quick and sudden to be the sun, which has already completely set.  Then slowly, a chorus of small flashing lights, like lighters at a P-Diddy concert remembering B.I.G. while he raps “I’ll be missing you”, lights up the mountain.  Turns out, it was mating season for fireflies and his private mountain….that’s right, fireflies….was one of the few places left that had the right amount of water, humidity, firefly food for us to view them in the density that we saw.

Thousands of lights twinkle on and off lighting the forest.  We were able to catch them in our hands and make them flash lights to the music of Kanye West’s “Stronger” bumping from my iphone.  Well….not really, but we were able to catch them and that was kinda cool.

Anyways, that was one of my better days.  I hope the excruciatingly painful details I provided was a good alternative to my usual banter of falling off fences, psychobabble about father and son, and dudes that looks like ladies.  I’ll write some direct replies to your emails now too since I have all day on the internet today.

Until next time, kids.

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So my dad wrote a comment on my earlier post saying that there is good and bad debt, and not having debt doesn’t mean you are good at managing your money.  That is definitely true, and I feel like I need to address what I think the nuances between good and bad debt are.

First of all, I am pretty sick of people telling me that a mortgage is good debt, because it is not that simple.  I think a mortgage can be good debt if the property you purchased  generates cash flow. In the case of a primary residence, this means that the cost of your monthly mortgage is less than the cost to rent a similar home. In the case of a rental or investment property, this means the rent you collect covers your mortgage and maintenance costs.  Additionally there is the possibility of asset appreciation, but that is an uncertain factor that should be measured conservatively.  A mortgage is definitely bad debt if you can’t afford it or if you have to  stretch your finances extremely thin to afford it.  If you are losing buckets of money by taking on a mortgage, then it is bad debt.

Another iffy type of debt is student loans.  A lot of people consider them to be good debt because they financed an education, but I think student loans can also be bad debt if the education was never put to use or if the interest rates are extraordinarily high.  Then again, it’s hard to gauge the future when you are young, idealistic, and have a passion for learning. However, it is possible to figure out the approximate salary you could potentially receive by finishing a certain degree.

Credit card debt is another thing that could be good or bad.  If your credit card debt has 0% interest, it is possible to leverage that money into safe investments and pay the credit card company back.  In fact a whole group of people have taken advantage of this in the past few years when bank interest rates were high.  However, most people who have credit card debt are in a situation where they are paying extremely high interest rates on purchases of useless items.  That is extremely bad debt.

So what’s the bottom line?  I think good debt is basically debt you could make a profit on and bad debt is the debt that make you have less than what you started with.  It is hard to figure out which is which in some situations, but when you realize you have bad debt you should work on eliminating it as soon as possible.

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In part one I talked about dealing prejudice, and I got some pretty interesting comments. I encourage you guys to check it out. In this part I want to talk about the reasons why in some instances you shouldn’t try so hard to fit in. Granted, everyone wants to be “normal”, and I expressed that feeling in a previous post about sending children to school early. However, being “normal” is not always wise, and you shouldn’t follow along for the sake of being part of the majority.

It all started when I was a kid. I was never into fashion and I was fine with wearing things I picked out at church sales for 25 cents. Heck, I still have one of those shirts and I wear it sometimes. I have been teased about my clothing in elementary school, but it didn’t matter to me. I knew that having brand name clothes and shoes wouldn’t really affect my schoolwork and I had good friends anyway.  Additionally, my parents really didn’t have money to buy me new clothes so there was no reason for me to unnecessarily add to their expenses.

Now that I am an adult, I think I still tend to shy away from what is considered popular. For example, I still don’t have an iPod, and I don’t intend to ever get one. I could afford a very nice car, but I have no need for it. Considering how many of my coworkers have extremely luxury cars I would say that I am in the minority. I’m not in a car contest with them, so I don’t feel the need to join in and fit in. I have to confess that as a teenager I wanted a Porsche, but now I understand that fancy cars are not necessarily a mark of success because most of them are financed by debt.

Another way that I am a minority right now is that I am a renter. I have written quite a few articles on why I am not buying a house now, and I truly believe that in San Mateo County I am building more wealth by renting rather than buying. Even though I will buy a house some day, I think it is good to have a different mindset right now.   I know many people jumped in to real estate because everyone was doing it in the past couple years.  Now many of the same people are regretting their decisions.  So in the particular case of real estate, I am glad that my husband and I did not decide to buy anything when we got married even though our parents wanted us to.

Finally, what is scary to me is that in America debt is considered normal. Dave Ramsey actually has a funny sticker that says, “Debt is normal, be weird!”. So when it comes to things such as debt and fashion, I don’t mind being in the minority. In fact, I think many people would be much more successful than they already are if they stopped trying to fit in and do their own thing.  I know that peer pressure is a powerful force, but we have to be level headed and see if “normal” is really the best thing for our goals.

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Hello everyone, welcome to the Carnival of Twenty Something Finances for the week of April 7th, 2008. In this edition we have more than forty articles on a variety of financial subjects that twenty somethings could learn about. Read on for some financial enlightenment!

Editor’s Picks

Investing Man presents 10 Tips On How To Negotiate posted at Wealth Building Lessons. This reminds of my post where I said everyone should haggle. Investing Man’s article expands the idea to all types of negotiation.

Finance Girl presents Childhood Money Memories, Part I posted at Finance Gets Personal. Finance Girl followed my post and wrote about her childhood money memories. There are some great stories here!.

Monevator presents Four ways to stop a financial crisis derailing your money goals posted at Monevator.com. Monevator gives great advice about not panicking in this economic environment. This is a very detailed and well written article.

Tip Diva presents Tip Diva | Top Ten Tips - Going Dumpster Diving posted at Tip Diva. This is a pretty interesting list of tips. I haven’t gone dumpster diving, but in the past I have gotten clothes, furniture, and books that were discarded on the side of the street. I am wearing a pair of my neighbor’s unwanted jeans right now.

Sarah presents The cost of graduating where she discusses how expensive a diploma really is! I never got my diploma because I was too lazy to order it. I think it’s still in Sproul Hall somewhere and employers verify everything online these days so I never needed my physical paper diploma.

Budgeting & Saving

Heather Johnson presents 8 Ways Women Can Save the Whole Family Money posted at wpersonalfinance.

GBlogger gives us Silly Rabbit, Budgets Are For Kids—How We Do Use Budgets posted at Can We Get Rich on a Salary?

zork presents 15 Ways to Exercise Your Budget during Recession posted at It’s the Recession, Stupid!.

Dividend Growth Investor presents Back test Results of one Rule of Thumb posted at Dividend Growth Investor.

Livingalmostlarge presents Budget backwards with priorities posted at LivingAlmostLarge.

Faron Benoit presents Establish Financial Goals posted at Financial Learn.

Seb presents Five things you should buy used posted at Pinching Copper.

Credit and Debt

Michael Bass presents What You Should Know About Credit Cards posted at Debt Prison.

Steve Faber presents - How to Get Out of Debt Fast posted at Debt Free.

FIRE Finance presents Three Quick Steps To Get Out of Debt! posted at FIRE Finance.

Shuchong presents I Thought it was Supposed to be Good Debt! posted at But WHY Doesn’t it Grow on Trees?.

Ray presents How To Avoid A 0% Balance Transfer Mistake posted at Money Blue Book.

Michael Bass presents What You Should Know About Credit Cards posted at Debt Prison.

College

Ted presents Cheapest Textbooks Online posted at CampusGrotto College News.

Patrick A. Sizemore presents 10 Guilt-Free Splurges for Students posted at College Information for Smart Students.

Realm of Prosperity presents Great Financial Aid Advice For College Students!!! posted at Realm of Prosperity.

Career and Income

Shanti presents WWSD #3: How Can I Work at Home Successfully? posted at Antishay Ventenne.

Tracy Kiss presents Conscious Flex: How to Find Your Passion and Make It Your Career: by Nicholas Powiull posted at Conscious Flex.

Passive Income Investor presents How I Generated $2,667 In Passive Income Last Month posted at LIVING OFF DIVIDENDS & PASSIVE INCOME.

Karin Verbeek presents From Nine-to-Five - That?s All You Need posted at Time Management Blog.

Economy

Wenchypoo presents Inflation—Here We Go Again posted at Wisdom From Wenchypoo’s Mental Wastebasket.

Free Stuff

Sally Thompson presents The Freeloader?s Toolbelt: 50 Tools to Help You Get Anything Free Online posted at Free Geekery.

Investing

Rio presents The Easiest Way to a Start a Roth IRA [del.icio.us] posted at Get Financially Fit!.

Charles H. Green presents Great Moments in Self-Regulation: Financial Planners and CFP Board posted at Trust Matters.

David Carter presents Why I Invested in Gold posted at David Makes Cents .com.

Richard M. Rothschild presents Bond Market Index Funds posted at Bond Market Index Funds.

Jorge H. presents Have We Hit the Bottom? posted at My Adventures into The Street.

Moneywise presents Largest mutual funds and their expenses posted at The Real Returns.

Real Estate

Ana presents Foreclosure Crisis Means A Buyers Market posted at DebtFREE-Revolution.

Dorian Wales presents The Personal Financier: How to Make Sure this is your Dream Home: 7 Practical Tips posted at Personal Financier.

Roshawn Watson presents Is Home Ownership A Good Investment? posted at Watson Inc.

Other

David presents $10 Bus Fares: Frugal or Frightening? — Money Under 30 posted at Money Under 30.

KCLau presents Financial Security: How you feel it? posted at KCLau’s Money Tips.

That is all for this edition. Thank you all for submitting your wonderful articles and make sure to link back and promote the carnival via social bookmarks! If you want to participate in the next carnival it will happen in two weeks and you can submit your articles here.

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Wow, spring is almost upon us, and there are more San Mateo Home Sellers in Trouble, too. This is the most distressed properties I have ever seen in a 4 week period. 135 properties is almost 30% of all the listings in our small county.

Total Count of San Mateo Home Sellers in Trouble for 2/11/2008 to 3/09/2008: 135

Average Time from Last Sale Date: 1.65 Years

Average Annualized Loss: 19.1%

Average Absolute Percentage Loss: 15.76%

Average Size of Home: 1228

Average Price Per Square Foot: $467.47

Biggest Losers : 330 Wisteria Dr in East Palo Alto with an annualized loss of 99% and 2568 Illinois Ave in East Palo Alto with an absolute loss of 48.35%

I have decided that I may start a different blog and update it more frequently to record these properties. The blog would be a good service to my community and it would be easier to navigate than these spreadsheets. Each home will have its own post and I can categorize the homes much better via blog categories!

Anyway, today I read a really good article by a teenage girl about the foreclosure situation: Teen columnist: For adults, foreclosure is payback time. I am glad to see there is still hope for the younger generation!

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