How much debt do you have?
- Thread starter puresavage
- Start date
Interesting to see everyone's point of view on Credit. I have mixed feelings about it personally.
When I was about 20 I had 10K in debt on CreditCards which NEVER ended and was stuck in a revolving debt cloud for over a year, stressing about the next month payment. I can certainly say without a DOUBT that I never want to be in that particular situation again.
At this point in life I only owe money on my mortgage but where I live interest is highway robbery at 9% a year.
Why do I do this? Well for a few reasons. I don't have a massive wad of cash to payoff the place, but if I did I probably wouldn't. Cash in my hands has much more value to me as I can build businesses which in turn can one day provide me enough to just pay it off.
This just shows that if you use Credit to your advantage it can be helpful, but it can bite you in the ass big time if you have a bad run of luck or something of the sorts.
When I was about 20 I had 10K in debt on CreditCards which NEVER ended and was stuck in a revolving debt cloud for over a year, stressing about the next month payment. I can certainly say without a DOUBT that I never want to be in that particular situation again.
At this point in life I only owe money on my mortgage but where I live interest is highway robbery at 9% a year.
Why do I do this? Well for a few reasons. I don't have a massive wad of cash to payoff the place, but if I did I probably wouldn't. Cash in my hands has much more value to me as I can build businesses which in turn can one day provide me enough to just pay it off.
This just shows that if you use Credit to your advantage it can be helpful, but it can bite you in the ass big time if you have a bad run of luck or something of the sorts.
In ~2004 I was strapped with $90k debt, but have paid it off since thanks to AM.
I've been totally debt free for over a year now and I am living with no other cards than my bank debit card and a Chase credit card @ 10% that I use primarily like an AMEX card that I can carry if I want to. -It comes in handy in many situations like when you don't trust the seller and want the option of dispute... You know, like when you've been led into some other WF user's evil ploy and signed up for a rebill...
Debt is the civilized world's last remaining form of slavery, in every way that implies.
Smart people = Free
Dumb people = Slaves
Plain and simple... Just not simple enough for most dumb people to understand.
(I can talk; as I said I was 90k in myself once!)
Debt if used properly is a tool. can grow a business massively with it, major corporations use it and profit heavily, mortgage interest is tax deductible so it's wiser than paying rent, etc etc. there's plenty of good reasons to have debt if you're not an idiot.
I have $0 debt. Had a mortgage but sold the house.
mortgage interest is tax deductible? hmm, I'll have to look into this in canada. I never would of thought it would be.
edit: a quick search shows its not the same in canada
Thank you for the tips bros.
BoA was the very first place i've applied to.
but they've rejected me. lol
I've also applied to Sears, JCP, HomeDepot, BoA, all those places.
Bleh...
LoL From reading above posts bet ppl will think I am stupid.
Total Debt = 400k
200k Mortgage
200k Line of credit.
Debt is from several different companies. Online Company = 0 debt.
I maybe 400k in debt but my net worth is a nice chunk. I carry the debt for business reasons and for tax reasons.
I would not advise it unless your accountant gives you the ok.
Oh I will say credit Card Debt = 0
Total Debt = 400k
200k Mortgage
200k Line of credit.
Debt is from several different companies. Online Company = 0 debt.
I maybe 400k in debt but my net worth is a nice chunk. I carry the debt for business reasons and for tax reasons.
I would not advise it unless your accountant gives you the ok.
Oh I will say credit Card Debt = 0
mortgage interest is tax deductible? hmm, I'll have to look into this in canada. I never would of thought it would be.
edit: a quick search shows its not the same in canada
You can for rentals.
From wikipedia - too lazy to maneuver through CRA's site:
"Canadian federal income tax does not allow a deduction from taxable income for interest on loans secured by the taxpayer's personal residence. But homes used in businesses as a landlord who owns a rental residential property can deduct interest as any other reasonable business expense."
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As for this thread. Just paid off the student loan, have about $200K mortgage on a rental. Just about breaks even with rent, and it builds on equity.
I'm a little surprised with the whole "never getting credit cards" approach people are taking here.
Anyone that says debt is bad probably isn't meant to be in this industry. Though I've never been in debt and likely never will, debt is only bad if you can't make more off the money than the interest rate. Buying a house on credit is rarely a good idea. An example of where it WOULD be a good idea is if it will cost say $12,000/year to rent the place and you can buy it and pay less than that INCLUDING the interest. Just because your payments go down to $11,250/year doesn't make it a good deal because you have to tack on the interest rate on top of that. Now if you had a 5% interest rate (just to make things easier to calculate) and the house cost $100,000, then your yearly payments to the bank should be $6,999($583.25/month) or less. Now there is an exception to this. If you can take that extra $750/year and make more than $5000/year from it then that's a wise business decision. But that would be a 667% return on your money and not very likely if you're using conventional investment techniques.
Most people don't look at the whole picture when buying a house. All they see is that they're saving $750/year and they don't tack on the interest they're paying every year. Of course, people with a business oriented mind would likely live in a shit hole in order to save money and not get into debt. But there are some times when this isn't possible. For example, if you have a family obviously living in the ghetto in a 1 bedroom $450/month apartment isn't an option.
Most people don't look at the whole picture when buying a house. All they see is that they're saving $750/year and they don't tack on the interest they're paying every year. Of course, people with a business oriented mind would likely live in a shit hole in order to save money and not get into debt. But there are some times when this isn't possible. For example, if you have a family obviously living in the ghetto in a 1 bedroom $450/month apartment isn't an option.
i'm not sure how 95% of wickedfire is going to survive as the internet continues to polarize and most of you are out on the industry in 5-10 years.
debt is not evil it's simply a tool nearly every business uses to leverage itself and grow.
while personal credit card debt is terrible (lulz 16-22% interest rates) don't let that ruin your appetite for credit all together. especially with interest rates so low.
and my god you guys talking about buying rental properties with cash please go kill yourselves. a liability like a personal home is one time. but rental properties... can't even believe it.
debt is not evil it's simply a tool nearly every business uses to leverage itself and grow.
while personal credit card debt is terrible (lulz 16-22% interest rates) don't let that ruin your appetite for credit all together. especially with interest rates so low.
and my god you guys talking about buying rental properties with cash please go kill yourselves. a liability like a personal home is one time. but rental properties... can't even believe it.
You must spread some Reputation around before giving it to FTC-Hater again.
serious bro-love here, this man knows what he's talking about.
Yup, AT&T has reported for me for about four years now.
Capital One, you probably won't get rewards points or anything good but it's better then nothing.
mortgage interest is tax deductible? hmm, I'll have to look into this in canada. I never would of thought it would be.
edit: a quick search shows its not the same in canada
Yes you can as long as you say you use part of your home as an office space then you can write off the interest.
Ever little but helps bringing down your taxable income.
0$ right now. But Sure I will have to take some debts to give a boost to my business.
And yeah if used properly Debts can come in handy.
And yeah if used properly Debts can come in handy.
Debt is not slavery. Last I checked you can't opt-out of slavery.
Show me someone with a successful business who never takes on debt, and I'll show you someone who could have made at least twice as much money if they had.
Show me someone with a successful business who never takes on debt, and I'll show you someone who could have made at least twice as much money if they had.
No...mortgage interest is tax deductible in the US regardless if you use a home office or not. A home office just makes a portion of the entire bill tax deductible.