[CA renter]

lpjohnso, I think you’ll be very happy about your decision to stay put. Great choice. Best of luck to you and your family!

And save, save, save!!! 🙂

[CA renter]

[quote=FlyerInHi]CAr, what’s wrong with having high expectations that your kids will be chosen among the smartest?

A top education is a badge of merit, if your kids can get in on their own, without you pulling strings. Connections trumps merit, but everyone wants to make it in their own in some way.

People often talk about merit and hard work. But they don’t mean it for themselves.

If I had kids, I would teach them early on that the Ivy league is the only way, and I will find a way when it comes time. if you don’t teach them any differently, that’s the only thing they know. Maybe they don’t make it, and that’s totally fine but you have to set expectations for excellence.[/quote]

Nothing at all wrong with high expectations, but there is a difference between that and “paying for a dream,” as scaredy noted.

Also, I think you grossly underestimate how expensive kids are, even before they ever step foot in college. I’m sure most of us parents have been a bit surprised at the expenses once the kids come along. With multiple kids? Forget it, you’re toast. Not saying it’s not worth it — it’s beyond worth it to most of us as the emotional “ROI” is out of this world — but there is no doubt that having kids is one of the worst possible financial decisions one can make. They cost A LOT of money.

[CA renter]

[quote=AN]I wish they teach personal finance in HS (make it mandatory) and teach them about ROI. Maybe then, there won’t be so many people graduating with $200k+ in loan with a starting salary of <$40k. I think that kind of debt load really affect them for many years to come.[/quote] AN and spdrun make some excellent points in this thread. Unless the Ivy League degree is going to be "worth it" (the kid has a clear idea of what he/she wants to get into, and it practically requires a degree from an elite university and/or the connections that can be made in those schools), I just don't see the logic of pushing kids into expensive schools that may or may not help them in their careers. I know people with degrees from Harvard who are doing NOTHING with those degrees, and I know kids with CSU degrees (or no degrees) who are doing exceptionally well. What matters is the field you choose to go into and the connections that you have...and luck, of course! It's much better to save that money and/or keep your kids out of debt so that they can have some sort of cushion as they grow older. As many of us already know, your 40s and 50s come sooner than you think, and there is nothing worse than reaching that age and realizing that you have too few financial resources and too much debt. I love AN's idea of buying investment properties for the kids. I think that would give a lot of kids more financial security and peace of mind in the long run than an Ivy League degree. Just MHO.

[CA renter]

[quote=scaredyclassic][quote=Essbee]I attended an Ivy for undergrad. This was the mid-1990s.

You see, there is this beautiful thing called “need based financial aid.” Because my family was poor, I graduated with only about $12K in debt. I think we had to pay about $1000-2000 per year toward expenses, as well. I did have to get a job (work-study, probably about 6-8 hrs/week) and that gave me my pocket change/spending money.

If I had gone there more recently, I would have graduated with ZERO debt, as families who make under a certain amount ($50K, I think) have to contribute zero now.

I would have no hesitation about sending my kids there (although it is far too early to know if they will have the aptitude or interest in attending), but unless our financial circumstances change for the worse, I doubt they will be receiving any need-based financial aid.[/quote]

Need based aid is bullshit. Why is the family unit the source of money. In general 18 year Olds are adults. We don’t send families to prison when one member commits a crime. Why is a family’s assets and income pillaged for a degree for an adult who will get the benefits of that degree herself over many years

Why are families involved mandatorily at all???.

I honestly do not get it.

If I don’t want to pay it doesn’t matter my kid can’t get aid. But he’s not “rich”. None of my wealth, paltry as it is, Belongs to him at all…

Why involve families?[/quote]

I’ve always had a problem with this, as well. Some families will scrimp and save all their lives in order to send their kids through college. Other parents will kick their kids to the curb at age eighteen, perhaps with a few hundred dollars to get them started, even though the parents are loaded.

Each student should get financial aid based only on his/her individual needs.

[CA renter]

[quote=spdrun]… and restoring previous levels of PUBLIC funding for PUBLIC universities. Take the money from Homeland Security and War on Drugs bullshit programs if need be.

I’d rather see outright funding to the universities than students being forced to take on loans. Yeah, yeah, spending on social programs is so old-fashioned in 2015…

[/quote]

Exactly right, spdrun.

[CA renter]

[quote=flyer]The variables other than education are the real deal breakers. Can’t tell you how many people I’ve known and my kids have known who got where they are via connections vs. education. In my kid’s case, even with great degrees, connections trumped education every time.[/quote]

Could not agree more.

I grew up with a lot of kids whose parents worked in the entertainment industry. Not one of these kids went to college, but almost all of them have good-paying jobs in the entertainment industry. Lots of people with Fine Arts or Cinema and TV degrees really want these jobs, but can’t get them. It is all about having the right connections.

If you look at the stories of the wealthiest Americans, you’ll find that most of them had some sort of connection that lead them to their successes.

That brings us back to the Ivy Leagues where the education is often no better than what’s found in state colleges. The difference is that the students in the Ivy League schools were specifically chosen because of their unusually high IQ and personal initiative. Those traits alone are two of the best indicators for future success. It’s not the schools that make the students successful, but the students who make the schools successful and give these schools their reputations. Of course, highly intelligent people who tend to come from more successful (read: more intelligent) families can make some powerful connections this way, and that’s why families have traditionally chosen to send their kids to these elite schools whenever they had the opportunity to do so.

[CA renter]

[quote=FlyerInHi][quote=spdrun] all without debt.[/quote]

What is it with people on here being so against any debt?

Debt is leverage and the way (along with selling stock) to get wildly rich beyond your initial seed capital.

Generally, the richer the society, the higher the debt levels.
For example, rich people get multimillion dollar loans to buy houses, boats, planes, etc…

When assets/collateral lose too much value, the end result is bankruptcy. Too bad student debts can’t be discharged in bankruptcy. I think they’ll have to reform that if young families are so burdened by student debts that the overall economy suffers.[/quote]

For every one person who gets rich by using leverage (outside of housing), there are thousands (millions?) who go broke because of debt.

If you don’t have intelligence and a lot of luck on your side, it’s best to avoid debt whenever possible.

[CA renter]

[quote=spdrun]http://en.wikipedia.org/wiki/German_nationality_law#Dual_citizenship

For her, there seems to be a process that allows keeping German citizenship if one acquires foreign citizenship. Being a dual citizen is always the best option if one views citizenship as a matter of convenience.

OTOH, he’d likely need to renounce his US citizenship if he acquired German citizenship, but he could easily gain permanent residence via marriage without renouncing.[/quote]

Interesting. We know a couple of Germans who have renounced German citizenship and obtained U.S. citizenship. I would think that people would choose dual citizenship whenever possible. But I believe the people we know plan to stay in the U.S., so they might have had different ideas. I agree with you that dual citizenship is almost always preferable, especially if one can maintain access to the benefits available in many European countries.

[CA renter]

[quote=FlyerInHi]A US degree or experience is always more valuable, because of perceived value (real value is debatable). With the US credentials and American English, you can go and work anywhere (Mohammad Zarif, Christine Laguarde, Raghuram Rajan, Stanley Fischer, etc…)

[quote=spdrun] because it’s a big fucking waste of life to be always rooting and hogging.[/quote]

I agree… but some people are good at what they do. It doesn’t take them much effort.

[quote=spdrun]
Having a government that takes care of things like health insurance, education, working hour negotiation, etc from cradle to grave is actually a big time-saver.[/quote]

I also agree.. Great for the average Joe.

But for people who have good health insurance it’s better here.

Another of my relatives works at a major university. He married a German girl and who loves it here. She says medical and maternity services is nicer and friendlier here. They live in a university town 2 miles away from work.

Interestingly, he prefers Germany, but they are waiting for her US citizenship (3 years) before they move to Berlin, where he will change career and start his own business as a music promoter.

America is good for people who are smart, talented and “excellent”. Not so good for the average Joe who’s content to just get married, have kids and raise a family.[/quote]

Out of curiosity, if they’re planning to move back to Germany (for an indefinite/extended period of time?), why is she trying to get U.S. citizenship? Wouldn’t it be better for him to get German citizenship (and for her to keep her German citizenship) for all the reasons already stated by spdrun?

[CA renter]

We’re more familiar with the older areas in La Costa. Some streets have lots of kids because the older homes have turned over after the original owners passed away. Some areas have more rentals, and they can have quite a few kids, as well. It really depends on the individual streets, as some streets are more active than others.

If you have any specific questions about streets or neighborhoods, feel free to ask here or on PM.

The LCV neighborhood is our favorite as far as the newer areas are concerned. Nicer homes, generally larger lots, etc. The Davidson homes are especially nice, but those are going for more money now. Still worth watching the area as a well-priced home will come on the market (and go fast) every now and then.

[CA renter]

Lots of good advice from the other Piggs here.

Personally, I think you should consider either option #1 or option #3. Agree with the others that #2 (HELOC and pay off debts/upgrade house) would not necessarily be the wisest decision **unless you are incredibly disciplined about your finances.** We don’t know what caused your current debts (medical emergency, school debt, etc.), so we can’t really judge how well you manage your money.

Your second option would be wise ONLY IF you pay off debt with much higher interest rates AND if you cut your expenses rather drastically…hopefully, you could increase earnings/income, as well. By paying off ~15-20%+ credit card debt with a HELOC that is capped at a very low rate, you can deduct the interest paid on this loan, which you can’t do with credit card or most other consumer debt, and you can pay your debts faster, and dramatically lower your interest expenses.

See details for deductibility here:

http://www.irs.gov/publications/p936/ar02.html

Additionally, the lower rate will enable you to pay off your debts more quickly, and pay less in interest IF you stick to a very disciplined payoff plan.

As flu noted above, you first need to think hard about why you’re currently in debt, and be honest about your ability to get out of debt and stay out of debt. If you’re in any way inclined to pay off some debt, but then spend any “extra,” or if you think you’re likely to go further into consumer debt because your habits or spending/income don’t change, do not go with option #2.

Option #3 is tempting if you don’t have a family and would be willing to downsize or move to another, less expensive location. That’s certainly a viable option, IMHO.

If you had said that you don’t like the house and want to move to a different location or type of house, etc., I’d tell you to go with option #3, but rent instead of buy something else, as things are very bubble-like right now. If you could stay with family for a very long time (rent-free or low rent), then it would make that option even more compelling. But since you’ve said that you wouldn’t move if not for the equity, I’d have to agree with the other Piggs who say that you should stay put and work on clearing your debts and building up some more savings the hard way (increasing your income and/or cutting spending).

Final opinion: Go with Option #1.

[CA renter]

[quote=rockingtime]The biggest problem I see from where I stand and from my observation of last few years: Flight of high paying jobs.

I have been observing the outsourcing of jobs to low cost countries. Wherever I worked in the last 10 years, I see the jobs going away to low cost countries. These are high paying jobs which pays upward of 100K/year

My friends in the hi tech center are working more and more hours for lesser pay to justify their salaries. Initially, it used to be the bottom of the barrel jobs shifted out but not people from low cost centers are getting the best projects.

I hear all the job reports and the rosy picture but I don’t see that happening.
In SD, the hospitality, retail and construction sector jobs are not well paying all, They don’t pay north of 100K.

I am not an expert on anything related to economy but I could see the housing bust coming in 2007 and was lucky enough to buy a SFR for me at the bottom. Although a lot of people told me to buy in SD in 2007 because SD home prices never go down and this time is different theory.

From where I stand and with my limited knowledge/experience, I see the middle class evaporating from this country faster n faster now..[/quote]

Totally agree with this.

And yes, capitalism eventually destroys itself. We are getting to the point where it will be capital/traders vs. capital/traders; the big fish swallow the other big (but smaller than they are) fish. The working people are becoming weaker and weaker, and have less and less. There is not much blood left to get from them at this point, so the capitalists will start going after each other.

[CA renter]

[quote=FlyerInHi]Stop watching TV and supporting the sponsored products if you have problem with the money involved.[/quote]

What I watch doesn’t affect it (and I watch very little TV). It’s the fact that advertising costs so much, and that so many companies use mainstream advertising (it would be nearly impossible to buy only goods and services that didn’t advertise), that makes people like me end up paying the outrageous salaries of folks in the entertainment industry (including actors and athletes) and marketing/advertising execs.

[CA renter]

[quote=FlyerInHi]I read a lot… but not novels. Novels put you in different worlds.[/quote]

Agreed. I also read too few novels. That’s why we need a book club! 🙂

[CA renter]

[quote=FlyerInHi][quote=The-Shoveler]They cannot control everything True, but they can do a lot more than most on this board seem to think.[/quote]

Yes, the Fed under Greenspan made many mistakes that led to the 2008 crash. But the Fed under Bernanke, did a great job to get us out of recession, notwithstanding Congressional inaction.

You’re right, yes we can where other countries cannot. America has many natural economics advantages going for us.[/quote]

They weren’t “mistakes,” Brian. I’ve seen internal Fed papers that were discussing the bubble years before it actually burst. The govt knew exactly what was going to happen. Look at how they loosened GSE/FHA standards about two years before the crash. During the bubble, the private mortgage market grew while the GSE’s market share shrank. They were trying to shift as many mortgages as possible from the private market to the govt before the crash so that they could “save homeowners” (banks/lenders) when the crash came by publicly guaranteeing the mortgages and instituting various foreclosure moratoriums. They were looking to socialize the costs while they privatized the profits, as usual.

Additionally, Bush brought Bernanke on as an economic adviser in ~2005, IIRC, years before the crash. It was not a coincidence that he was considered an expert on the Great Depression. IMO, he was asked to chair the Council of Economic Advisors so that he could help advise them about the best way to handle the upcoming crash and resulting recession/depression. This is also why he was chosen to head the Federal Reserve.

They absolutely knew what was going to happen. If they didn’t then they should all lose their jobs, and those of us who did know should be the ones making all the rules and earning all that cash! 🙂

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