How do you feel about debt?

So what generation will start paying off this debt? Who will be stuck in the equities/stock market?
Its just not going to go away, debt is a drug, always an excuse to "use" it.
Lets not forget Japan, where it took roughly 20 years (two decades) for their stock market to get back to the level it is today and Japan still has a mountain of debt. Someone always pays.

USA 1990 (only 20 years ago!)
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USA TODAY=
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USA for the next president in 2026
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oh, and none will pay it off.


I believe each year Uncle Sam makes interest only payments on that debt.
 
If you look at my fleet of cars you’ll see how much I like debt. Freedom is what I like, and debt takes that away from me.

However, I’m in the fence about getting one new car in the fleet to curb future interest rates. It’s cheap to get money today, but it seems like that bubble is about to burst.

While cars are expensive today, the interest rate will make it worse very soon.

Otherwise, we pay cash for most everything and raised our kids that way. They started working at 14 and were in pretty good shape starting life. What is killer on them is the cost of housing and cars. I can’t afford the house I owned 15 years ago, which would have been good for them as a first home…. I feel for them.
 
Why would I try to trick others? Let me clarify my thoughts on debt...
I never said all debt is good. There is good debt and bad debt. Personally I have zero debt, but it took 20 years to pay off my primary mortgage. I own a home in prime Silicon Valley real estate. Actually, my wife and I own 3.
I pay cash for my vehicles, which are typically the 2nd biggest cost people have.
When you get into your 60s, do you want to be paying rent or have a home free and clear? I am not sure about a college semester, but I am pretty fluent in mortgages.

My point about mortgages is, you have to have a place to live. Of course, location location location is a huge consideration. Credit card debt for clothes and fancy crap? No thank you; that's a recipe for financial ruin.
I used to be a drunk, broke and homeless. Today, let's just say things are different. You might be surprised how many people come to me for financial advice and help.

FYI, my biggest gripe about public education is the lack of personal finance as a part of the cirriculum. IMO, no one should get outta 8th grade without a basic understanding of banking, checking accounts and credit cards. No one should get outta high school without an understanding of mortgages, bond and stock markets, retirement and the time value of money.

I hope this clarifies my position. If you have any questions, please feel free to ask me.
It seems to me that once the house is paid off it and we are not in consumer debt, then all of a sudden there is lots of [extra] money.
 
There is data for that.

Key Points:
- 55% of Americans carry a balance month to month
- Nearly 1 in 5 Americans have over $20,000 in credit card debt.

And this is just consumer revolving debt (credit cards). Then add the installment loans (mortgage, auto, etc), personal loans and its clear to see that most Americans are drowning in debt.
Again, these figures don't paint the entire picture. How many people have automatically recurring charges to their credit card bills each month, like cable, internet of cell phone contracts ?
That would account for having a balance every month even if you didn't use the card for any other purchases.

But if 20% of Americans have over $20k in CC debt that is not caused by emergency spending, they need some serious talking to.
 
I would agree but a key question for this; is that debt manageable?

Now $20,000 in CC debt is a lot. It’s clear that a a big segment of the population is living by paying minimums. That would be the 20% noted above.
I manageable debt good? It can be but then sometimes not. What causes bankruptcy chapter 7 or 13?
 
Property taxes on paid for home rise slowly. The challenge is rent you have no control on that rent. It has at least doubled if not tripled in my area in coastal New England in last 10 years. Condo seems to be a good compromise of upkeep if not into it.
Property Taxes are a crime.
 
I would agree but a key question for this; is that debt manageable?

Now $20,000 in CC debt is a lot. It’s clear that a a big segment of the population is living by paying minimums. That would be the 20% noted above.
People need to work a side job to live with in their means?
 
"investments" are speculation.
Paying off a mortgage and living within your means in a mature fashion is a solid investment with almost no downside. Paying 15 years worth of interest with almost no significant reduction in the debt is a great "investment" once which frees someone from the lending companies.
As I pointed out in post number 149 of this thread. Why would someone not consider an investment paying off a mortgage in a timely 15 years?

Dont they realize this is an investment and the example I posted shows they pay the bank $180,000 less in interest by taking out a 15 year mortgage rather then pretend someone has money to invest by taking out a 30 year mortgage.
$180,000 less interest paid to the bank, vs speculation in putting your money someplace else instead of paying off your obligations first.

Once your mortgage is paid off, your home free and clear, you can dump an additional 15 years worth of money into whatever investments that you want with a fully paid off house. Not paying off a mortgage in a timely fashion of 15 years is more of a lack of financial understanding for the general public or an excuse for others to live a life they shouldn't be living, only a small percentage of people can put the money to work risk free by delaying paying off a debt for another 15 years and come out ahead.
I would not consider paying off a mortgage and market investing as either or. Do both, as well as invest in yourself.
There is a word, balance, that Americans do not understand. At least I don't. But I should.
 
So what generation will start paying off this debt? Who will be stuck in the equities/stock market?
Its just not going to go away, debt is a drug, always an excuse to "use" it.
Lets not forget Japan, where it took roughly 20 years (two decades) for their stock market to get back to the level it is today and Japan still has a mountain of debt. Someone always pays.

USA 1990 (only 20 years ago!)
View attachment 83949

USA TODAY=
View attachment 83950

USA for the next president in 2026
View attachment 83951


Without going into politics, based on historical fact alone:

Almost all great empires from the past end up borrowing more and more and as long as they don't 1) lose a major war and reduce their currency circulation area, and 2) their debt and currency (almost the same thing really, as no coins from most empires of the past are 1/1 face value of the precious metal it was mint with) are circulating outside of their areas, they can keep borrowing and inflate away their debt.

So to answer your question, US debt will be fine as long as we keep inflating it away and the rest of the world keep lending to us. If we loses influence among the world (i.e. oil and commodities no longer sold in USD) or US split up and some new states use a different currency that the others don't, then we will be in big problem.
 
People need to work a side job to live with in their means?

If they have to do that then they need to reflect on their spending habits.

Low income people do multiple sidejobs all the time because of cost of livings. How else do you think our society gets around a lot of those "benefits" and "workers comp" mandate?

Next: how to use gig economy to work around sky high minimum wage laws.
 
I try to avoid it where necessary. There's been a lot of cool stuff I've wanted over the years but passed on because it would lead to something being put on a credit card. Yeah, it would have been cool to have, but no way do I need that.

I'll likely always have a mortgage. And the student loans will follow me to the grave.

The only debt I really regret is the student loans. Going to college was the biggest mistake of my life.
Are there no hopes of career advancement/higher income?

That would allow you to pay off student loans and a mortgage.

And climbing the chain, having a college degree definitely helps.
 
Are there no hopes of career advancement/higher income?

That would allow you to pay off student loans and a mortgage.

And climbing the chain, having a college degree definitely helps.

Depends on industry.
For IT - college degrees aren't worth the paper they're printed on.
I'm just as far along in my career as I would have been if I didn't go to college. In fact, I'd probably be further along since that's 4 years of experience I missed.
 
Depends on industry.
For IT - college degrees aren't worth the paper they're printed on.
I'm just as far along in my career as I would have been if I didn't go to college. In fact, I'd probably be further along since that's 4 years of experience I missed.
I have to disagree with you on this. Of course, IT is a very broad industry. Network, hardware, programming, security and management. All different but interdependent skills. The big $$ is being responsible for something deemed mission critical.
If you can add business need skills into the mix, you will be prized.
 
Property Taxes are a crime.
While I would to own my home outright, it seems impossible.

Without property taxes, how will the non-state roads be plowed, paved, etc? schools paid for, ems supported, etc. Maybe have every road a toll road?
 
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