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Investments

Discussion in 'General' started by Trunxgp1224, Apr 21, 2017.

  1. Lawn Dart

    Lawn Dart Difficult. With a big D.

    We both know what I was saying there. :p
     
  2. auminer

    auminer Renaissance Redneck

    Make 200K
    Pay bank 30K in interest
    Write off that 30K and get taxed 40% on 170K
    Pay taxing entity 68K
    Take home 102K.


    Make 200K
    Get taxed 40% on 200K
    Pay taxing entity 80K
    Take home 120K.


    EDIT>>> Use the savings to move somewhere you're not being taxed 40%!!!
     
    badmoon692008 likes this.
  3. SteveThompson

    SteveThompson Banned by amafan

    Your tax rate is 40% and you're not getting caught in alternative minimum tax?
     
  4. Kris87

    Kris87 Friendly Smartass

    Your scenario also assumes you have liquid cash to pay off your home immediately. And to incur $30k of interest in a year, its going to be a big mortgage. I've done the math every way you can imagine. I like my scenario on a 15 yr note, saving those 15 years, taking the tax break, rather than paying all towards my mortgage and delaying any savings. This isn't hard to do if you do the calculations realistically.
     
  5. SuddenBraking

    SuddenBraking The Iron Price

    I wasn't even going to respond to the post as it basically presupposes that you can get a house for free.

    I'm not sure where in scenario #2 above he's running the cost of his house through his P&L; yes, if someone just gives you a house, much better to do that than to buy one with (or without) interest :rolleyes:

    Here's a scenario - by paying cash for the house you end up costing yourself about $400K at the end of 30 years.

    upload_2017-4-25_9-59-14.png
     
  6. SuddenBraking

    SuddenBraking The Iron Price

    Point taken; I changed the tax rate to be more representative (although the simple example wasn't designed to take specific tax laws into account and was meant to be illustrative).

    BTW, fuck the AMT.
     
  7. NickyZ

    NickyZ Well-Known Member

    It's a 1031 exchange. I deal with them frequently. There is a local attorney (Steve Robison) that specializes in these. Very affordable - he owns a nationwide company that does only 1031 deals: https://www.spe1031.com/. You need a straw man to authenticate for IRS purposes. Use him or one like him - much cheaper than a general practitioner.
     
    casjoker likes this.
  8. auminer

    auminer Renaissance Redneck

    You're assuming a 6 percent guarantee on the DJIA. Your logic is fail. :crackup:

    You go right ahead and pay your bank interest so that you can write it off. Fine by me.

    Are you also calculating writing off your principal payment?
     
  9. Trunxgp1224

    Trunxgp1224 Well-Known Member

    well the DJIA is already up 1% this morning, NASDAQ set a record at 6K

    I'm also not sure how my numbers would work out in any of your scenarios or spreadsheets, I have a 232K mortgage @ 3.75% and I make about 30K in taxable income which puts me in the 15% bracket.
     
  10. SundaySocial

    SundaySocial Blue & Gold

    The Market is a LONG term strategy. Buying a home is NOT an investment, it is controlling your living expenses.
    The home pay off makes that 'payment' money available, every month that you continue to live there. Say $25. K a year, for the folks living in major urban/suburban areas. What could you do with 25. K a year ? That adds up to a second (or third) rental property fairly quick, @ 8% annual return. Your investment is is still there when you decide to get out (albeit at probably more than 3.% annualized growth). Some people think it is clever to let other people make their mortgage payments. YMMV.
    Understand that the market has MILLIONS of people that make their living offering insight into how to be successful in it, instead of making their living on their successful investments...
     
  11. auminer

    auminer Renaissance Redneck

    Quote of the day, week and year.
     
  12. SuddenBraking

    SuddenBraking The Iron Price

    I'm not sure what you're asking.
    Over the life of a 30 year mortgage using your numbers, you'll have $392K more in your pocket by NOT prepaying on your mortgage. That $392K figure does not change based on the value(s) in cell C2 (the amount of cash).

    upload_2017-4-25_11-47-49.png

    upload_2017-4-25_11-48-58.png


    upload_2017-4-25_11-49-8.png
     
  13. auminer

    auminer Renaissance Redneck

    Where do you sign up for this linear 6 percent annual guaranteed return?
     
  14. SuddenBraking

    SuddenBraking The Iron Price

    Not sure where it said anything about being linear or guaranteed; regardless, best of luck to all on this thread - hopefully we all reach our individual investing goals :beer:
     
    sdiver, GrayGhost and auminer like this.
  15. auminer

    auminer Renaissance Redneck

    OP : whatever you do, don't take the advice of a bunch of anonymous yayhooz on an internet forum... To include anything that I have posted.
     
    Last edited: Apr 25, 2017
  16. auminer

    auminer Renaissance Redneck

    What is the "Return on DIA" line on your spreadsheet?
    Do you have it in there on every line?
    Does it ever change?
     
  17. RxRC

    RxRC Well-Known Member


    No, you can deduct both. I am only deducting rental home interest now because the Standard Deduction is so large. Although I am still waiting for Trump to double it.
     
  18. Kris87

    Kris87 Friendly Smartass

    You could have done pretty well had you started investing in 2008 until now couldn't you have? :D
     
    auminer likes this.
  19. auminer

    auminer Renaissance Redneck

    You could, and I assume I did. I haven't looked at my brokerage accounts since I retired from managing money. The three guys that are managing my money now we're almost as good as me. ;)
     

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