[joec]

I think instead of guessing where the market will go, look at how you want to live your life. People have been saying interest rates will be going up for a few years now and they have all been wrong.

No one knows where interest rates will go, but rates are negative in Europe and Japan has been low for 20+ years?

I think India or some place just cut rates too.

In a global economy, US rates look very attractive compared to other places. I’ve been saving rates won’t move for a long time and even though I guess, it’s been the correct call for the last few years.

All that said, buying a home that you plan to stay in for the long term is a nice feeling. You have a fixed known housing payment and every month, you build a miniscure amount of equity. Also, if rates go higher/lower, and you have more savings, you can buy investment properties or refi.

Since you also have 20% down, that money is doing zip now. If you have more down, you’d probably save money compared to rent and I know in my hood, rents for 3k sqft econoboxes go for near 3800+ now a month. Pretty sick. Add in your tax deduction as well and you are probably ahead if the mortgage is only 200 more a month.

As other conditions are putting pressure like kids and school, HATE renting, I think for your own life/well being, buying isn’t the worst thing in the world if you can afford the payments, like the area you pick, and your mortgage isn’t comparably more than your rent.

Unlike some posters here, I don’t see housing collapsing unless rents collapse. Also, many people who bought in the last five years have high cash flowing properties so may prefer to rent instead of selling if they can (I know a few in my area)…

Good luck!

[joec]

[quote=lpjohnso][quote=all]Selling a house in order to keep buying new car every 2-4 years does not sound like a great idea.

You might not like spdrun’s model of driving 20+ year old cars, but is 2013 Prius really that much better than 2007 Corolla? And the lease on Odyssey is close to what monthly payment would be if you just bought new.[/quote]
I’m totally down for the 2007 Corolla.[/quote]

Is the wife ok with the 2007 Corolla? In my shoes, I know my wife likes newer/nicer cars than me now so it’s a hard sell for women to drive old cars (safety).

I do the balance transfer thing unfortunately…I do get some 2% fee ones so since we run a business and charge a lot, have lots of cards and very high limits. That makes it easier to avoid messing up. I think if you also miss a payment, all your cards can get jacked up to a very high APR so you need to have high attention to detail to not mess up.

I assume you aren’t contributing to a 401k? If you had a large balance, you can also do a loan which is a decent option IMO. Pay self interest, fast access to money, can withdraw a lot, doesn’t show up on any credit report…

You lose that saving for the future thing, but hey, if you’re paying 20%, I think you need to close that card out ASAP.

I think your 2 cars are definitely screwing you up. Our soon to be paid off car is lower in payment and we’ll own it soon. Course, we put a lot down initially so it never was underwater…

With all the data, I think it’s safe to say you shouldn’t refi/cash out as there are too many things to spend on.

[joec]

I think getting into UCSF and some of the other UC med programs are just as hard probably as some privates. That said, something that wasn’t mentioned is that if you were seeing a doctor, a lawyer, tech guy or anything in life, doesn’t it make sense to see someone who is probably the best or hardest working?

Usually, but not always, the guy who even got into Harvard or top programs are already people who can and have worked their asses off to get there. I’m sure you have some folks who are smart at SDSU, but I don’t think those people are anywhere near the caliber of the guy at some of these other places. The reason is because the person at the top private school, if he was top probably was recruited and given free tuition if they couldn’t afford it. Look at this high school guy who I know is smarter than me…Look at the end of the article where me would like to go to school:
http://www.utsandiego.com/news/2013/dec/10/eric-chen-siemens-flu-project-canyon-crest-academy/

Do you see a UC there? Will your own learning or research or think big go further working and studying next to this guy or the 3.6 gpa guy going to SDSU?

The reason Essbee posted about her med school experience was because if you wanted to go to a top program, you probably have to also go to a top school and do really well. Going to Cal State isn’t going to cut it I feel and think some folks here are being a bit short sighted when it comes to the money.

scaredy, I think you’re doing your kids a disservice by not at least considering the option as more of a positive if they even get in rather than forcing SDSU down their throats.

Again, please note that there is no guaranty that the ivy grad will do better, but, in general, they do make MORE money so the guy who posted that the cal state guy can make more or just as much is smoking crack:
UCB is 20th on this list. Other than the military ones (which are awesome deals if you can get in (also very hard to get in)), all the pay from graduation to 5 years out is higher on average for all the private schools:
http://www.payscale.com/college-salary-report-2014/full-list-of-schools

That said, you still have to get in…Is it worth it? Generally, you can

Again, my views are also based on my own experience and I felt UC degree is worth “less” than say a degree from Stanford/Harvard, etc…when looking for new jobs, business connections, etc…

[joec]

[quote=flyer]Very informative, nla. In our neighborhood (RSF), for better or worse, it’s pretty much “Ivy or bust” land. As I’ve heard from friends, even then, things don’t always work out as planned, so there are still no guarantees as far as career outcomes are concerned.

So far, so good, for the two of our three kids who graduated from Ivies, and I wish your daughter the best.[/quote]

Yes, no guaranteed outcome…Some friends of mine from UC who came from sorta wealthy families didn’t get into Stanford either and also have the ivy or bust mentality. Going to UC at the prep schools they went to was embarrassing and those people I know all had help buying their homes too (massive downpayment help which I had none of)…

Another reason I am more jaded in my view of UC in general and what you get upon graduating….

Again, there will be success stories, but I’m sure we can find just as much success stories from Stanford, Harvard, etc…

EDIT: Wanted to add:
Also wanted to add that if you also and really look up the success stories of a lot of the people in business, a lot came from at least upper middle class incomes with certainly some help.

Even Facebook Zuck had a sister who went to Harvard already and he went himself so I’m assuming he certainly wasn’t poor (again, I didn’t even apply to private schools)…

Gates dad was a high powered lawyer, also Harvard…

Steve Jobs dropped out of Reed College which is a 1908 private university who apparently has their own nuclear reactor for research now…
http://en.wikipedia.org/wiki/Reed_College

Point I am trying to make is money, parents, access, (which private schools/ivys) have more of compared to UCs with their constant budget issues is a better long term business/financial success environment than standard UC…

[joec]

[quote=FlyerInHi]If you begin saving before your children are born, you will be financiay stable by the time they reach 18. The likelihood of all 3 kids getting accepted into Ivy League is low. They may not even apply or want to go. But you should pay if your kid wants to go and is accepted.

Excluding housing, you don’t really spend that much on yourself.

Plus people shouldn’t have kids in their 20s. They should be financially stable before having kids.[/quote]

Don’t think you are married or have kids…but I believe if that were to happen, your view (assuming you wanted to stay married), will change drastically…

Similar to those famous divorced people who say they will never get married again…and in 6 months, get hitched…

this love thing makes people do completely illogical things.

Everything is easy to say or do as a single guy…been there, but life changes drastically with kids/wife.

[joec]

Thanks for sharing nla.

I also would like to add that all my comments are not purely black and white. If you son or daughter just wants to go to an ivy to just party and learn a crap major and do nothing, sure, it’s a waste of money probably. Maybe they want to get a MRS degree…maybe worth it, no experience there so can’t say.

My comments are all about having both options and if you get the ivy option, I feel it will be better if given both. The cost, as nla mentioned isn’t as insane as stated as well.

Also, with me being dead broke currently, if my kids DO get into an ivy, I assume we won’t have to pay a cent honestly. Makes the decision easy really.

Also, there has been a lot of articles in the past few years I’ve read that if you aren’t super wealthy, the ivy league school isn’t “THAT” much more expensive. In those cases, it’s a good option to get an education that probably isn’t as annoying with constant budget cuts, tuition raises (I lived through the 90s at UC)…and not being able to take your frigging class you want.

Also agree with the other comments that a lot of the people who get accepted into the Stanfords or Harvards of the world are already the top high school people so you already have a student body highly above most other people.

That makes it MORE likely that these people will carry you farther than a UC person.

On Nick Woodman, I posted about him before I think, but his parents live in Rancho Santa Fe and I believe they are very wealthy. He lost over 3 million dollars on his first start up (probably family friends) during the tech boom and after that, took a long trip to surf in Australia.

With wealthy parents, you can AFFORD TO TAKE time off JUST TO SURF. He developed what is GoPro after that there while selling jewelry with g/f / now wife.

This goes back to flyer and my point constantly that connections matter all the more since most people (me included) can under no circumstance take time off to just “play” in some foreign country.

After he came back, his dad helped him and invested money in his GoPro idea (I believe initial is 50k). Also, having wealthy parents invest money, I assume they also had other help to make the business a go which most people won’t have assistance or help with.

One reason that Nick Woodman is a poor example with being a UCSD grad in this discussion since his connections are a major reason for his success since most UC grads can’t afford to take that much time off work (since their parents aren’t the super wealthy types).

[joec]

I agree with the others that staying put makes the most sense too. No one knows the future and I was in the same boat in terms of savings…I had to sell a lot of outside assets (stocks) at a bad time 2009 to put tons more down to buy a house (bad loan environment). Luckily, housing has recovered a lot and I don’t know what will happen, but if I was still in stocks, maybe I’d sell out and waste the cash (certainly easier with kids and wife). With the money in the house now, it’s stored equity I don’t expect to tap, but should make life easier in a few years when housing cost will always be there, but your payment goes away or down.

One point that should also be brought up is if you are a single guy, you really don’t know how single women or single women with small kids feel in poor or unsafe areas. The constant gawking, staring from unsavory men, etc…

Unlike men who may want women to stalk or show interest, women are terrified if there are strange men/stalkers following them or showing too much interest.

This is also why women tend to not want unreliable cars since they don’t want to be “stuck” in the middle of nowhere…Men don’t really expect to get raped I don’t think (or will feel lucky if they did)…

All that said, 3 kids, in an area you like in 1400 sqft isn’t too much space. Not being a fan of dogs, those are huge expenses with just 1 vet bill so if they age, maybe you can go with less dogs in a few years.

Also, with 3 kids, a wife and college, trips, events, etc… cashing in the equity is sorta a guaranty you will spend it.

With no pets and 2 kids and a wife, I already feel totally overwhelmed since the money call isn’t always yours to make in a marriage.

Best of luck.

[joec]

[quote=flu][quote=AN]joec, Paul Jacob went to UCB, Paul Allan went to Washington State University, Jerry Yang went to Standford, Larry Page went to UMich and Standford, Sergey Brin went to University of Maryland, College Park (public) and Standford, Tim Cook went to Auburn University (public) and Duke University for MBA, Steve Jobs went to Reed College and dropped out, Marissa Mayer went to Standford, etc. I can go on and on, but there are plenty who did not go to Ivy and made it big. I would rather my kid be Steve Jobs and drop out of Reed College than Zuch’s wife.[/quote]

Practically speaking, Stanford is equivalent to the Ivy’s if not better. Just like MIT. Between it and Berkeley, I’d say it’s a toss up.[/quote]

Yes, if you look at my message, I said Stanford is sorta my west coast Ivy League…I think in the Ivy League, there are some considered not the “best” either like Brown I think.

That said, I’d love if my kids can go to Stanford and I am a fan. I can’t be an Ivy snob since I didn’t go, but I sorta look more highly on people who did go to the Stanfords or Harvards of the world. The reason is because I feel they are more selective than UC to begin with (maybe I got in so I think UCs suck and I have low self esteem?)

Here is list of CEOs degrees from 2012…Note that no UC is there in general.
http://www.usnews.com/education/best-graduate-schools/top-business-schools/articles/2012/05/14/where-the-fortune-500-ceos-went-to-school

My point again is if your goal is to take the top job, having the degree will help. The data doesn’t support going to UC will help much since they are not even in the top 10. I also mentioned, yes, there are some great UC people (I think Broadcom CEOs were from UCLA)…

But, again, I think if given the choice, most people would go to Stanford over UCB if cost wasn’t an issue.

I also knew people who didn’t get into Stanford, but got into the other UCs so I am thinking Stanford is “better”…(remember, I didn’t even apply).

[joec]

[quote=flyer]
Your daughter’s aspirations (even though I realize she’s still very young) remind me of the conversations many parents today are having, even with older kids.

Many of the kids today don’t really want to get “real jobs,” and they don’t realize the competition for “dream jobs” is extreme.

My wife runs into the heirs of tech moguls in Hollywood all the time who are immersed in the business–developing/bidding on projects, etc.–and want to be as far away from tech or the way their parents made their money as they can possibly get.

Again, connections prevail, that completely shut out many other very capable individuals. This seems to be holding true in many professions, other than entertainment.

Then, of course, professions that may be “hot” today may not be when kids graduate from college. Again, variables so numerous, that choosing a profession has almost become like throwing darts at a dartboard.

Hopefully, as their kids get older, parents will level with them concerning the realities they will be facing in life.[/quote]

As someone who got accepted at both UCB and UCLA (I went to one of them), I’m actually sad I never had or even tried to go to an ivy. In an economical asian household, UC was considered good enough so that was what I was left with.

I think one point that is mentioned and I agree that it’s the most important is connections. When you go to ivy or Stanford (which I feel is the west coast ivy), you go to school with kids who will probably run their own companies one day. Would’ve Priscilla Chan met Zuck if she didn’t study at Harvard? No…All these college classmates you have will probably be your last friends after school and a lot of these people coming out of these ivys come from families with money (some, not all)…who will start companies and hire you like all those early facebook people. Think Yahoo, Google, you name it and that’s only tech…

If you look around, you can see where the bulk of the fortune 500 CEOs come from. Look on Bloomberg TV and see where all the main reporters come from (IVYs, all). Also, look who runs the government now (ex-Goldman people coming from ivys)…Look at the past presidents…see any UC people there?

That said, yes, not all ivy grads will make it big and not all UC grads will suck shit, but (and this may insult a lot of people), UC people and their parents/families go to UC to just get a ‘decent’ job where they hit some ‘asian/or other’ glass ceiling while ivy league people just start the company with their friends or go to some better job since they knew someone else in that same circle.

I would definitely want my kids to go to Ivy if possible and think UC (having graduated from one), is just worker bee type thinking people.

Maybe it’s just my own limited career/work experience, but the network is worth a lot more I think at a Yale or Harvard while UC is less helpful (due to asians which actually ‘Don’t’ like to help other asians)…

Still, one downside is unless you are culturally fit with these other ivy people, it maybe hard to get into their circle as well. I have some family who did go ivy and due to cultural differences (foreign), didn’t really do much with that and went back to asia…

flyer, I assume you are Caucasian?

[joec]

Would repeat what has already been stated. Do you HAVE to live in the same area? If you have a spouse/kids, every decision is a ton harder since as a guy, i could live in a “poor” area and not feel much about my safety as long as my car is crap too.

Rent is tons more expensive I’ve noticed everywhere now compared to 2009. A 330k mortgage at such a low rate should be easy compared to what rent is now since my mortgage is less than what people pay in rents currently for me.

The problem with housing is we have to live somewhere vs. a nicer car, etc…Unless you can move to a lower cost of living area or change your housing type (apt/rent/don’t care about schools, etc…), hard to rent for less in the same area.

[joec]

Like most forums, the problems with FiH’s advice is that it’s coming from someone who tends to do a lot of work on his own properties. For someone who comes here saying they know nothing, it’s worth at least doing the basics and pay the money.

Buying a home is a liability and getting stuck with a few hundred k vs saving < 1k is stupid. I saw it all the time in my work in tax, finance, tech, dating, you name it...Everyone feels they are an expert, but most people give flat out wrong advice. Not saying it's happening here, but when a buyer says they know absolutely nothing, it's better to pay for some honest hand holding. Here's his first line: " First off - I know nothing, absolutely zero, about what the process is in getting a loan for a home. Any tips or advice from the Piggs on how this process works and who to go through for the loan? " I say just call HLS, some people here have had honest help from him and ask him these questions. At the end of the day, I question how much people save by going it alone sometimes.

[joec]

[quote=flyer]Some “real-life” examples:

I’ve talked to many of the people who rent homes and condos from us both here in San Diego and elsewhere about their lives, and, although they have great jobs, most of them are not in a position to buy homes–would like to–but don’t know if it will ever be possible for them. In addition, they don’t know if they’ll keep their jobs long enough to be able to retire–ever–and on and on.

Other friends who also own lots of rental properties tell me they hear the same things from their tenants–people with great jobs, who can’t get ahead.

When my parents started renting properties out years ago, it seemed people would rent for a shorter period of time, then buy their own homes quite soon thereafter.

“Wealth Gap,” or otherwise, things seem to be getting tougher and tougher out there for more and more people.[/quote]

I think you, flyer, are one of the few people who sorta “gets” it here. It’s not just about spending money and ALL these people pissing their dollars away. Sure, some do, most incomes are just not that high. Also, it’s hard to save with a wife/family. Easy if you are single and can cut everything in your life (I was always the saver myself).

I think the problem with this forum and a lot of people (AN, yes you), is that if you have a great tech job or a very high paying (relative to the general populace) job, you’re really tone-deaf and out of touch with how a lot of people live.

As someone who HAS worked in high tech during the tech boom making well more than 200k+ and having options/perks/you name it…people in silicon valley, here, wealthy people simply don’t “get it”.

Having LEFT hi-tech and worked in other industries, finance, self employed, and seeing how regular schmos live, it’s not as easy to make it big since your job is REALLY not as stable, it’s not as easy to find work (I NEVER WORRIED ABOUT FINDING WORK WHEN I WAS IN TECH). I also got laid off and know of others who got fired and messed with by the company so they couldn’t find easy work afterwards. I also know someone who had 4 jobs in 4 years (CFP) and just can’t find that idea gig…

For people who have it, tech work IS really different than most other jobs (and some others as well).

Is this the fault of the worker? in a way, it is…but the tech industry wasn’t this lucrative say 20 years ago. Also, people working in econ/biz can be laid off and there might not be as much work to be had (traders now I hear)… (think architects also as an example) or even regular engineers not killing it as much I don’t think.

If your job isn’t that stable, you aren’t clearing massive amounts yet and you have a family, it’s a lot tougher…

I saved most of my money when I was single, much harder if you are ramping up young and your job changes a lot or layoffs, etc…

Taxes being more fair (tax all income the same) I think would help a bit (Warren buffet supports this)….

[joec]

If you look at my old posts, you can see I did say self employed can put more in retirement. That said, for a W2-er, your paycheck is your income. For a self employed sole proprietor, your revenue isn’t your income.

AN, you should just start your own thing and see how it goes…

[joec]

Looking over the 1st few top rated comments, everyone agrees she got off easy. It’s sad that until someone actually does get raped or murdered, you can get off scott free with no real punishment for plotting to get someone raped/killed.

Looking forward to reading negative articles on this woman…

[joec]

If you’re self employed, I think you’re also required to use “net” profits now as income. That makes it so you now may not qualify if you want to minimize your taxes in a given year…Want to contribute to your retirement? Maybe skip it a year to jack up your income to qualify for a refi…

HLS, are you seeing non x-corp business owners getting many mortgages/refi’s in the current environment?

I think it’s all like this because every bank is trying to sell the loan back to fannie/freddie. Since they set the rules, they do whatever they require. If banks held the loans like maybe 30 years ago, then the guidelines would be more varied I’d assume.

Does any institution even hold loans anymore?

[Author]

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