# Financial disacuity **URL:** \ **Category:** Miscellaneous and Personal Stuff I Must Share\ **Created:** [December 22, 2014, 8:10pm UTC](https://boards.straightdope.com/t/financial-disacuity/707949 "2014-12-22T20:10:44Z")\ **Posts on this page:** 20\ **Page:** 18
**Author:** ![Justin\_Bailey](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/justin_bailey/32/8792_2.png) [@Justin\_Bailey](https://boards.straightdope.com/u/Justin_Bailey)\ **Post date:** [January 2, 2015, 6:22pm UTC](https://boards.straightdope.com/t/financial-disacuity/707949/341 "2015-01-02T18:22:55Z")
> [@Ruken](#): > > It’s about risk tolerance, probability, and cost. Do you buy insurance beyond what the law requires? That “is only the right play if you can see the future and know that you’re going to” crash your car, burn your house down, etc. Or are you and **ftg** some of the people this thread is about? > [@monstro](#): > > It bothers me that folks who are financially disacuituous will listen to **ftg** and **Justin\_Bailey** before they will listen to someone like me. I’m just responding to the scenario **monstro** laid out. And the way she wrote gave no mention if the person knew they would lose their job or if the business was shaky or anything. Just that a person with $15,000 uses it to put a down payment on their house and then six months later they’re laid off. Ideally, a prospective homeowner would put down [20%](http://www.realtor.com/advice/much-need-payment/), but the 10-15% put down by **monstro** ’s hypothetical buyer is very common as well. For the scenario as presented, buying the house is not a bad idea in any way and only becomes a bad idea _if you know the future_. No amount of backpedaling or accusing me of hating the poor will change that. ---
**Author:** ![monstro](https://avatars.discourse-cdn.com/v4/letter/m/ba9def/32.png) [@monstro](https://boards.straightdope.com/u/monstro)\ **Post date:** [January 2, 2015, 7:50pm UTC](https://boards.straightdope.com/t/financial-disacuity/707949/342 "2015-01-02T19:50:21Z")
> [@Justin\_Bailey](#): > > For the scenario as presented, buying the house is not a bad idea in any way and only becomes a bad idea _if you know the future_. No amount of backpedaling or accusing me of hating the poor will change that. WTF. This doesn’t make an ounce of sense. Would you advise someone who’s been fired twice in the last year and works in an industry that’s taken hits over the past decade to buy a house? What about the couple who’s been in marriage counseling for the past year and can’t go five minutes without getting into a fight? Would you tell these people, “Go ahead. Buy a house! Who knows what the future holds!” Or would you tell them, “Hey now. Are you sure about this?” Very few people expect the worse to happen. But the worse can and does happen. You seem to think that a person has to face foreclosure before they know they made a bad decision. But most people who face foreclosure had a number of clues available to them before they even signed the dotted line. They were either clueless about them or they chose to ignore them because “zombie invasion lolz!!!” Owning is better than renting for people who have stable incomes and who buy property in good neighborhoods (according to [this](http://www.chicagobusiness.com/realestate/20121211/CRED0701/121219958/foreclosure-much-more-likely-here-for-fha-loans) source, one reason there’s a high foreclosure rate with FHA loans is because lot of FHA loan recipients buy in neighborhoods with negative equity), located in places where the price-to-rent ratio is low. It is not better for those who don’t meet these criteria. **Spice Weasel** , I think the Great Recession scared me a bunch too. I remember how everyone lectured me on critical it is I buy a home RIGHT NOW…just a few months before the bubble popped and the massive lay-offs happened. If I had listened to all that “helpful” advice back then, I would have been screwed big time. I would have been tied to a location I hated, doing work that I hated, without the income I would have needed. And if I’d lost my house, those same people advising me would have then had every right to lecture me on the ills of “keeping up with the Jones’s”, “following the crowd”, and “listening to bad advice”. I say there’s no shame in valuing a sense of security over “winning”. Peace of mind is priceless. ---
**Author:** ![Justin\_Bailey](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/justin_bailey/32/8792_2.png) [@Justin\_Bailey](https://boards.straightdope.com/u/Justin_Bailey)\ **Post date:** [January 2, 2015, 7:53pm UTC](https://boards.straightdope.com/t/financial-disacuity/707949/343 "2015-01-02T19:53:38Z")
> [@monstro](#): > > Would you advise someone who’s been fired twice in the last year and works in an industry that’s taken hits over the past decade to buy a house? What about the couple who’s been in marriage counseling for the past year and can’t go five minutes without getting into a fight? Would you tell these people, “Go ahead. Buy a house! Who knows what the future holds!” Or would you tell them, “Hey now. Are you sure about this?” One. More. Time. None of this information was in your first hypothetical. ---
**Author:** ![monstro](https://avatars.discourse-cdn.com/v4/letter/m/ba9def/32.png) [@monstro](https://boards.straightdope.com/u/monstro)\ **Post date:** [January 2, 2015, 8:04pm UTC](https://boards.straightdope.com/t/financial-disacuity/707949/344 "2015-01-02T20:04:01Z")
> [@Justin\_Bailey](#): > > One. More. Time. None of this information was in your first hypothetical. Why does it matter what was in the hypothetical? You made the ludicrous statement that owning is ALWAYS better than renting. I painted you a picture to show you how this isn’t true, and instead of saying “ah, I see now”, you’re complaining because the hypothetical didn’t include a crystal ball. That’s fucking insane, man. ---
**Author:** ![Frylock](https://avatars.discourse-cdn.com/v4/letter/f/ce7236/32.png) [@Frylock](https://boards.straightdope.com/u/Frylock)\ **Post date:** [January 2, 2015, 8:28pm UTC](https://boards.straightdope.com/t/financial-disacuity/707949/345 "2015-01-02T20:28:17Z")
Someone above mentioned it’s important to know whether homes in the neighborhood are riding or falling in value before buying. How can you find this out? Is there a website that shows price histories at the neighborhood scale? ---
**Author:** ![monstro](https://avatars.discourse-cdn.com/v4/letter/m/ba9def/32.png) [@monstro](https://boards.straightdope.com/u/monstro)\ **Post date:** [January 2, 2015, 8:31pm UTC](https://boards.straightdope.com/t/financial-disacuity/707949/346 "2015-01-02T20:31:13Z")
> [@Frylock](#): > > Someone above mentioned it’s important to know whether homes in the neighborhood are riding or falling in value before buying. How can you find this out? Is there a website that shows price histories at the neighborhood scale? You can do a search on a zip code on [Zillow.com](http://Zillow.com) and find some useful indicators. ---
**Author:** ![Justin\_Bailey](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/justin_bailey/32/8792_2.png) [@Justin\_Bailey](https://boards.straightdope.com/u/Justin_Bailey)\ **Post date:** [January 2, 2015, 9:04pm UTC](https://boards.straightdope.com/t/financial-disacuity/707949/347 "2015-01-02T21:04:44Z")
> [@monstro](#): > > Why does it matter what was in the hypothetical? You made the ludicrous statement that owning is ALWAYS better than renting. I painted you a picture to show you how this isn’t true, and instead of saying “ah, I see now”, you’re complaining because the hypothetical didn’t include a crystal ball. > > That’s fucking insane, man. I’m complaining because you wrote A and I responded to A and then you come back and are asking me why I didn’t respond to B. That’s frustrating as all get out. ---
**Author:** ![monstro](https://avatars.discourse-cdn.com/v4/letter/m/ba9def/32.png) [@monstro](https://boards.straightdope.com/u/monstro)\ **Post date:** [January 2, 2015, 9:51pm UTC](https://boards.straightdope.com/t/financial-disacuity/707949/348 "2015-01-02T21:51:44Z")
> [@Justin\_Bailey](#): > > I’m complaining because you wrote A and I responded to A and then you come back and are asking me why I didn’t respond to B. > > That’s frustrating as all get out. I don’t know what the hell you’re talking about. Do you think factoring in job stability when deciding whether to buy a home is the same as worrying about earthquakes and zombie invasions? If the answer is yes, then your frustration is probably the result of you not understanding probability, risk, and a bunch of other things. If the answer is no, then I don’t know what you’re arguing with me about. Either come up with some cites or examples to explain whatever it is you’re arguing for or sit down somewhere. I think I have done a good job communicating. Your frustrations are completely self-imposed. ---
**Author:** ![Frylock](https://avatars.discourse-cdn.com/v4/letter/f/ce7236/32.png) [@Frylock](https://boards.straightdope.com/u/Frylock)\ **Post date:** [January 2, 2015, 10:16pm UTC](https://boards.straightdope.com/t/financial-disacuity/707949/349 "2015-01-02T22:16:29Z")
> [@monstro](#): > > You can do a search on a zip code on [Zillow.com](http://Zillow.com) and find some useful indicators. Thanks, that’s a helpful link. Some of the houses in the neighborhood of the house I’m looking at (including the house I’m looking it) suddenly dropped precipitously in value just over the last year. Others are even or steadily rising. No idea what that means. ---
**Author:** ![monstro](https://avatars.discourse-cdn.com/v4/letter/m/ba9def/32.png) [@monstro](https://boards.straightdope.com/u/monstro)\ **Post date:** [January 2, 2015, 11:09pm UTC](https://boards.straightdope.com/t/financial-disacuity/707949/350 "2015-01-02T23:09:55Z")
> [@Frylock](#): > > Thanks, that’s a helpful link. > > Some of the houses in the neighborhood of the house I’m looking at (including the house I’m looking it) suddenly dropped precipitously in value just over the last year. Others are even or steadily rising. No idea what that means. I just looked up my house (the one I rent) and it’s value has dropped 10% since 2012. But my zip code saw 6.4% 1-year increase this year. ---
**Author:** ![Ruken](https://avatars.discourse-cdn.com/v4/letter/r/f475e1/32.png) [@Ruken](https://boards.straightdope.com/u/Ruken)\ **Post date:** [January 2, 2015, 11:13pm UTC](https://boards.straightdope.com/t/financial-disacuity/707949/351 "2015-01-02T23:13:07Z")
> [@monstro](#): > > I think I have done a good job communicating. You have. I wouldn’t bother with further effort here. ---
**Author:** ![Justin\_Bailey](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/justin_bailey/32/8792_2.png) [@Justin\_Bailey](https://boards.straightdope.com/u/Justin_Bailey)\ **Post date:** [January 3, 2015, 1:35am UTC](https://boards.straightdope.com/t/financial-disacuity/707949/352 "2015-01-03T01:35:34Z")
> [@monstro](#): > > Either come up with some cites or examples to explain whatever it is you’re arguing for or sit down somewhere. I think I have done a good job communicating. Your frustrations are completely self-imposed. It feels like you’re talking in circles. Stopping this is probably a good idea. ---
**Author:** ![Saint\_Cad](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/saint_cad/32/18907_2.png) [@Saint\_Cad](https://boards.straightdope.com/u/Saint_Cad)\ **Post date:** [January 3, 2015, 7:47pm UTC](https://boards.straightdope.com/t/financial-disacuity/707949/353 "2015-01-03T19:47:21Z")
> [@Amateur\_Barbarian](#): > > Neither polarity of that statement is 100% true. Some “objects” are worth more, in every sense, than some experiences. But people who buy only objects and forego experiences are losers in the long run. > > I can think of nothing sadder than sitting on your custom Euro furniture in your showplace home built out over your 4-car garage of luxury cars and sporting vehicles, looking out at the reflections of your custom pool… without a memory of doing anything other than a daily grind to get there. > > We’ve been on several cruises, including a very expensive one about five years ago. You can have most of the junk in my house before I’ll give up those experiences and memories. Except at issue are the people that will spend $100s on experiences but can’t feed their kids or pay the bills/rent. ---
**Author:** ![Saint\_Cad](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/saint_cad/32/18907_2.png) [@Saint\_Cad](https://boards.straightdope.com/u/Saint_Cad)\ **Post date:** [January 3, 2015, 8:03pm UTC](https://boards.straightdope.com/t/financial-disacuity/707949/354 "2015-01-03T20:03:21Z")
We had this exact rent vs own discussion when we moved. It turned out to be easier to buy rather than rent because of the market. But here is what we were looking at: Rent at best $1400/mo in the city we wanted to live in. Buy $1600/month about 25 mi from where we want to be. Interest is less than $800 per month so assuming no increase in equity we are paying ourselves at least $800 every month. Let’s say repairs are $200 or heck even $300 per month EVERY MONTH viz. $3600 per year we still are ahead by $300 every month we are not renting. My take is that we are saving money or at absolute worst (remember the 25 extra miles) breaking even to pay for an investment. Financial disacuity would claim we are spending $200/mo extra plus costs ownership. ---
**Author:** ![even\_sven](https://avatars.discourse-cdn.com/v4/letter/e/dfb087/32.png) [@even\_sven](https://boards.straightdope.com/u/even_sven)\ **Post date:** [January 3, 2015, 8:10pm UTC](https://boards.straightdope.com/t/financial-disacuity/707949/355 "2015-01-03T20:10:47Z")
> [@Saint\_Cad](#): > > We had this exact rent vs own discussion when we moved. It turned out to be easier to buy rather than rent because of the market. But here is what we were looking at: > > Rent at best $1400/mo in the city we wanted to live in. > > Buy $1600/month about 25 mi from where we want to be. > > Interest is less than $800 per month so assuming no increase in equity we are paying ourselves at least $800 every month. Let’s say repairs are $200 or heck even $300 per month EVERY MONTH viz. $3600 per year we still are ahead by $300 every month we are not renting. > > My take is that we are saving money or at absolute worst (remember the 25 extra miles) breaking even to pay for an investment. > > Financial disacuity would claim we are spending $200/mo extra plus costs ownership. What is rent 25 miles out from where you want to be? It’s pretty absurd to compare a downtown location to a far-flung suburb. ---
**Author:** ![Saint\_Cad](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/saint_cad/32/18907_2.png) [@Saint\_Cad](https://boards.straightdope.com/u/Saint_Cad)\ **Post date:** [January 4, 2015, 1:39am UTC](https://boards.straightdope.com/t/financial-disacuity/707949/356 "2015-01-04T01:39:55Z")
> [@even\_sven](#): > > What is rent 25 miles out from where you want to be? It’s pretty absurd to compare a downtown location to a far-flung suburb. Long story mostly involving an incompetent mortgage broker. ---
**Author:** ![handsomeharry](https://avatars.discourse-cdn.com/v4/letter/h/e9c0ed/32.png) [@handsomeharry](https://boards.straightdope.com/u/handsomeharry)\ **Post date:** [January 4, 2015, 2:17pm UTC](https://boards.straightdope.com/t/financial-disacuity/707949/357 "2015-01-04T14:17:05Z")
Hey, there’s nothing wrong with Stratocasters. ---
**Author:** ![Amateur\_Barbarian](https://avatars.discourse-cdn.com/v4/letter/a/59ef9b/32.png) [@Amateur\_Barbarian](https://boards.straightdope.com/u/Amateur_Barbarian)\ **Post date:** [January 4, 2015, 4:16pm UTC](https://boards.straightdope.com/t/financial-disacuity/707949/358 "2015-01-04T16:16:55Z")
> [@handsomeharry](#): > > Hey, there’s nothing wrong with Stratocasters. Yeah! They burn twice as long as Stradavarii. ---
**Author:** ![Mrs\_Ducky](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/mrs_ducky/32/6227_2.png) [@Mrs\_Ducky](https://boards.straightdope.com/u/Mrs_Ducky)\ **Post date:** [January 4, 2015, 7:05pm UTC](https://boards.straightdope.com/t/financial-disacuity/707949/359 "2015-01-04T19:05:22Z")
I bought my house when I was 25 in 1978. (I don’t care if you do the math:) ) I was single at the time and everyone told me I would have a hard time getting a mortgage. When I applied, the bank wanted to loan me more than I asked for. The loan officer asked me why I wasn’t buying a house for $45,000 and I said, “Because I want this one for $35,200”. I paid it off on March 19, 2003. We are debt free except for taxes, utilities, insurance and everyday living expenses. My husband is retiring next week from the railroad and we are financially secure. There are two rentals across the street from us that are going for $800 to $900 a month. I never paid that much in house payments. Life is good. ---
**Author:** ![Waymore](https://avatars.discourse-cdn.com/v4/letter/w/919ad9/32.png) [@Waymore](https://boards.straightdope.com/u/Waymore)\ **Post date:** [January 5, 2015, 1:32am UTC](https://boards.straightdope.com/t/financial-disacuity/707949/360 "2015-01-05T01:32:52Z")
> [@Dangerosa](#): > > Note that you have to factor in TIME to get processed foods to be cheaper. > > My minister’s husband works with immigrants on teaching them how to negotiate American grocery stores. Immigrants from Asia, Europe, Latin America, and a lot from Africa who are coming with almost nothing. Rice, beans, garlic, canned tomatoes, olive oil, corn meal, frozen peas, broccoli, spinach plus fresh onions and sweet potatoes are the basic foods he teaches them to use - and most of the cultures have many of those foods as their basics. Plus, most of the Africans have religious food taboos. And the essential crockpot - which makes it possible to take beans that have soaked overnight, throw them in a pot with water, rice and a can of tomatos and have dinner when you arrive home. Nearly everything there is shelf stable or can be kept in an apartment freezer to reduce waste. > > Immigrants do it without off brand mac and cheese, **but our own poor apparently can’t soak beans overnight and throw them into a crockpot**. Excellent point. I don’t want to hijack the thread with politics, but the talk of “Food Deserts” that afflict the poor in the US should be met with skepticism in my estimation. [Previous page](https://boards.straightdope.com/t/financial-disacuity/707949.md?page=17) [Next page](https://boards.straightdope.com/t/financial-disacuity/707949.md?page=19)