Budgeting

[GarMan]

I also disagree with him about paying off your home mortgage.  The mortgage interest tax deduction is one of the most beneficial ways to adjust your taxable income.

I don't know if I completely agree with that.  Let's be brutally honest for a moment.  Most people live in houses that they wouldn't ordinarily be able to afford without a bank lending them money.  It's become an American standard to hold a mortgage for more than 30 years, and it's really stupid.  Just on the economics, a 6% mortgage on a $100k house is only going to give you around $6k in home interest deduction.  During the early years of a mortgage, that's only $6k that you can take off your AGI.  The actual tax savings is only about 20% of that $6k depending on your tax bracket, so let's say that's $1200 a year in tax savings.  The choice is to either pay the bank $6k in home interest every year or pay the government $1200 in additional tax every year.  From a personal economics standpoint, I know that Dave Ramsey is right. 

[Tarheel]

I don't know if I completely agree with that.  Let's be brutally honest for a moment.  Most people live in houses that they wouldn't ordinarily be able to afford without a bank lending them money.  It's become an American standard to hold a mortgage for more than 30 years, and it's really stupid.  Just on the economics, a 6% mortgage on a $100k house is only going to give you around $6k in home interest deduction.  During the early years of a mortgage, that's only $6k that you can take off your AGI.  The actual tax savings is only about 20% of that $6k depending on your tax bracket, so let's say that's $1200 a year in tax savings.  The choice is to either pay the bank $6k in home interest every year or pay the government $1200 in additional tax every year.  From a personal economics standpoint, I know that Dave Ramsey is right. 

I have no intention of holding a mortgage for more than 30 years unlike most people.  I suppose you could say that I could have stayed living in an apartment throwing away my money but it makes more sense to get a house in my opinion...IF you can afford to make the mortgage payments.

If you can afford to buy a house outright then more power to you; that's not me.  I didn't buy more of a house than I could make the payments on either unlike a lot of folk.

And as low as the interest rates are right now it's cheap money in my opinion (assuming one can qualify of course).

Anyway, when compared to being raped by the IRS for what they confiscate from my earnings versus being able to make the adjustment to my earnings with the interest deduction I'd rather take the deduction as a part of my itemized deductions (especially as opposed to the standard deduction) than not.

As a side bar, we need a better tax system anyway.  Flat Tax or Fair Tax; either one would be better than what we have now, eh?

[GarMan]

I have no intention of holding a mortgage for more than 30 years unlike most people.  I suppose you could say that I could have stayed living in an apartment throwing away my money but it makes more sense to get a house in my opinion...IF you can afford to make the mortgage payments. 

Yep...  Rent is a complete throw-away option.  A mortgage is always better.

If you can afford to buy a house outright then more power to you; that's not me.  I didn't buy more of a house than I could make the payments on either unlike a lot of folk. 

Well, the trick is to get there as quickly as you can.  As aggressive as the Ramsey method may seem, once you do get there, you're financially set to do that. 

Anyway, when compared to being raped by the IRS for what they confiscate from my earnings versus being able to make the adjustment to my earnings with the interest deduction I'd rather take the deduction as a part of my itemized deductions (especially as opposed to the standard deduction) than not. 

I can't fault anyone for being stupid for that because I'm doing the same thing, but speaking from the economics standpoint of the individual, it's not a benefit as the $6k to $1200 comparison shows. 

Another aspect of this is who does better with the money, the bank or the government?  As a capitalist, I'd say the bank.  As an American, I say Fuck the Government. 

[Saniflush]

  As an American, I say Fuck the Government. 

Off to the re-education camp for you.

[Tarheel]

As aggressive as the Ramsey method may seem, once you do get there, you're financially set to do that. 

I'm not eating beans and rice.  Fuck that.  (Sounding more like Gordon Ramsey there!)

I can't fault anyone for being stupid for that because I'm doing the same thing, but speaking from the economics standpoint of the individual, it's not a benefit as the $6k to $1200 comparison shows. 

GarMan, I understand your tax logic but the fact of the matter is without a mortgage (and while paying rent that was more than my mortgage is now) it would have taken me decades longer to save enough money to purchase a house outright than the years I did wait in order to buy my house.  Hell, I'd still be living in an apartment even now and still throwing away money for rent.  Fortunately, I was able to save up enough for a hefty down payment which helped.

Another aspect of this is who does better with the money, the bank or the government?  As a capitalist, I'd say the bank.  As an American, I say Fuck the Government. 

Indeed.  It chafes my ass every year to think that Fed-Gov can limit us on how much we can put aside in a personal IRA...putting limits on saving in other words.

I guess it's off to the re-education camp for me too.

[GarMan]

GarMan, I understand your tax logic but the fact of the matter is without a mortgage (and while paying rent that was more than my mortgage is now) it would have taken me decades longer to save enough money to purchase a house outright than the years I did wait in order to buy my house.  Hell, I'd still be living in an apartment even now and still throwing away money for rent.  Fortunately, I was able to save up enough for a hefty down payment which helped. 

I completely understand.  I'm just pointing out the logic along with the flawed logic.  Nobody is suggesting that you should rent in order to save up to purchase a house outright.  The strategy is only to pay your house off as quickly as possible so that you can purchase outright in the future.  Get the mortgage to purchase your first home; then, fight to pay it off as quickly as possible. 

Indeed.  It chafes my ass every year to think that Fed-Gov can limit us on how much we can put aside in a personal IRA...putting limits on saving in other words. 

And, when you're ready, they're going to tell you how much you can take in distributions as well as hold their hand out for their share of your proceeds.  You just wait! 

To Democrats asshole Socialists, you only exist to serve them. 

[Thrilla]

Obama's gonna pay my mortgage

[Tarheel]

Obama's gonna pay my mortgage

 

"He's gonna buy my gas too."

"And I ain't gonna have to worry about anything anymore!"

[Tarheel]

I completely understand.  I'm just pointing out the logic along with the flawed logic.  Nobody is suggesting that you should rent in order to save up to purchase a house outright.  The strategy is only to pay your house off as quickly as possible so that you can purchase outright in the future.  Get the mortgage to purchase your first home; then, fight to pay it off as quickly as possible.

Yeah, that's the way I hope it will work; with The ONE and his minions doing everything they can to drive down wealth it may be a loosing battle.

And, when you're ready, they're going to tell you how much you can take in distributions as well as hold their hand out for their share of your proceeds.  You just wait! 

To Democrats asshole Socialists, you only exist to serve them. 

I may be eating beans and rice by then.

*Edit: I had problem with teh quote functions.

[boartitz]

Beans and rice ain't bad if they have some good sausage or a ham hock in with them.
Fish.
Surely most folks in the south know of a place where they can sit on the bank and catch a mess of fish once or twice a week.

[Townhallsavoy]

Beans and rice ain't bad if they have some good sausage or a ham hock in with them.
Fish.
Surely most folks in the south know of a place where they can sit on the bank and catch a mess of fish once or twice a week.

I've got one of the best red beans and rice recipes in the world if anybody needs to resort to eating beans and rice on a weekly basis.  They'll feed ya for about two-three days. 

[boartitz]

I've got one of the best red beans and rice recipes in the world if anybody needs to resort to eating beans and rice on a weekly basis.  They'll feed ya for about two-three days. 

They are always better the second or third day anyways. :thumbsup:
Anybody that eats beans and rice also has a good cornbread recipe.. Most of them drink buttermilk.

[Townhallsavoy]

They are always better the second or third day anyways. :thumbsup:
Anybody that eats beans and rice also has a good cornbread recipe.. Most of them drink buttermilk.

I don't know about buttermilk, but I do have a good cornbread recipe.  It involves an egg, milk, and a Jiffy box. 

[Jumbo]

I've got one of the best red beans and rice recipes in the world if anybody needs to resort to eating beans and rice on a weekly basis.  They'll feed ya for about two-three days. 

Bring it?

[Thrilla]

Bring it?

Step 1:  Go to store and buy Zatarans
Step 2: Follow the directions on the box

[Townhallsavoy]

Step 1:  Go to store and buy Zatarans
Step 2: Follow the directions on the box

Bleck. 

Try this one next time -

Ingredients:

1 bag of light red kidney beans (preferably Camellia brand)
1 medium sized smoked ham hock
1/3 cup of chopped ham
1 onion
1 bell pepper
1 cup of celery
3 cloves of garlic
2 large links of andouille sausage sliced almost thin
1 tsp thyme
1 tsp parsley
3 bay leaves
1 tsp of Tony Chachere's creole seasoning
1/2 tsp (or more) of Cayenne
10 cups of chicken stock (Kitchen Basics from Wal Mart works)
Rice

The day before you're going to cook, cover the beans with cold water in a large pot.  Add a large pinch of baking soda (this takes the farts out).  Let beans soak for 24 hours.  Drain and rinse before cooking. 

Cooking day - chop all vegetables and slice sausage. 

Step 1 - heat 1 tbsp of butter in a large stock pot.  Add the chopped ham for about 1-2 minutes
Step 2 - Add vegetables (onions, bell pepper, celery, garlic) and cook until wilted
Step 3 - Throw in all seasonings (thyme, parsley, bay leaves, cayenne, Tony Chachere's)
Step 4 - Add sausage and ham hocks and toss ham hock around.  You're trying to heat it up so it'll release its flavor.
Step 5 - Add beans and chicken stock and bring to a rolling boil.
Step 6 - Simmer for at least 2 hours.  Preferably more if you have time.  Stir occasionally.  Add water if they seem to dry out, but they won't.   
Step 7 - After 2 hours, use a spoon or ladle to mash beans against side of pot.  Do so until it starts to thicken up. 
Step 8 - Let beans cook while you prepare rice. 
Step 9 - Devour. 

Easy and delicious. 

[Hogwally]

     If you have a BJ's, Costco, or Sam's Club, they have really made a difference in our budget.  We buy all our basics at BJ's now, which saves a lot.  Also, check around for a good meat market.  I got so disgusted with the meat at Publix, I finally decided I would just have to pay more for decent meat at the local meat market.  What I learned is that at a lot of markets, they'll give a discount for buying in bulk.  If I buy the whole strip, I can buy NY Strips for $3.99 a lb.  Comes out to about 15 steaks, they're perfectly fine out of the freezer, way better than grocery store meat.  Same with chicken, boneless skinless chicken breasts are $1.69 a lb. if you buy at least 5 lb. 

I've decided I'm going to get as drunk as I can at home before we go out, and hopefully I won't drink as much while we're out to eat.  We'll see how that goes.

     This is actually a great idea.  The wife and I were invited to Benni Hanna's the other night.  The manager's special was dinner for two, including everything except alcohol, for $45.  The food was outstanding, an excellent dinner for that price. Unfortunately I drank $42 of beer to go along with it, plus a couple glasses of wine for the wife, and suddenly after tax and tip, I was in for $120 on a $60 dinner.
     I have decided anytime we go out to eat, I am putting a cooler full of beer in the car and making the wife drive.  I'll drink all the way there, all the way home, and we can go out to eat twice as much for the same money.

[wesfau2]

Unfortunately I drank $42 of beer to go along with it,

How long were you at the restaurant?  Even assuming a high price per beer, you're in for 6-7 beers over the course of a dinner.

It's a marathon, not a sprint.

[Hogwally]

     $7 x 6 (some fancy japanese brand).  Two beers before we were seated, 3 during dinner, and one while everyone else was sitting around drinking coffee.  It probably would have been more, but I didn't want to pull a drunk in front of the wife's friends.  I thought I was being pretty good, I was only ordering one at a time.
     Regardless, the point is it would have been much cheaper to go with a few in the truck on the way up there.

[Jumbo]

     $7 x 6 (some fancy japanese brand).  Two beers before we were seated, 3 during dinner, and one while everyone else was sitting around drinking coffee.  It probably would have been more, but I didn't want to pull a drunk in front of the wife's friends.  I thought I was being pretty good, I was only ordering one at a time.
     Regardless, the point is it would have been much cheaper to go with a few in the truck on the way up there.

Ordering one at a time! classic