TPB X thread (29 Viewers)

[1HuskerDad]

I can’t wait for college football.

Imagine waking up

Cup of coffee

Full slate of college football ahead of you

Your team has a manageable noon opponent. Nothing crazy but you get to watch your boys.

You get a simultaneous big noon big 10
showdown to follow. Good game down to the wire. You watch the last 20 minutes of the game after yours ends.

You get a beautiful 2:30 game to watch on your main screen. It’s OU vs a new prime time SEC opponent. It’s a big time Utah vs Kstate big 12 showdown. It’s a good game and you watch the whole damn thing.

The prime time night games come on. You’re beer-ed up, caffeinated, and ready for a big time game in Happy Valley or Death Valley. YES.

And finally, you’re ready for one last taste. You got Michigan State at USC kicking off at 10:30 local time. Why? Don’t ask me. Doesn’t make much sense! But that’s college football. Goodbye “pac 12 after dark” hello “wtf is this game and why am I awake”. It’s beautiful.

It was a perfect day.

We are getting so close. 🥰

 

[1HuskerDad]

Very cool!

 

[God is a Husker]

 

[Jim14510]

If you ignore risk, yes on average you win. But you can't really just ignore risk and call it a better investment.

And it's not even close to a guaranteed. You don't get to count all 30 years, because this person allocating extra to their mortgage is paying it off in 15, so they're going to match your RoR in the last 15 years, and they can invest more in those 15 years, since they now have no mortgage.

Ok 15 years I still win. At 30 years I'm still ahead.

Of course that doesn't mean Johnny high school dropout doing day trading is going to win.

I'm not taking risk out of the equation. The risk of investment being less than the reduced principle is at some point there during that 15 years. Especially in the first few years.

At 15 years the person investing (again within reason) wins.

Realistically the average person wouldn't have the stomach for it and withdraw. Either spend the gains or panic at a fall, sell off and tell everyone how bad the market sucks.

 

[1HuskerDad]

 

[MtnHusker]

 

[MtnHusker]

 

[MtnHusker]

 

[MtnHusker]

 

[HughJanus]

 

[Mavsker]

Ok 15 years I still win. At 30 years I'm still ahead.

Of course that doesn't mean Johnny high school dropout doing day trading is going to win.

I'm not taking risk out of the equation. The risk of investment being less than the reduced principle is at some point there during that 15 years. Especially in the first few years.

At 15 years the person investing (again within reason) wins.

Realistically the average person wouldn't have the stomach for it and withdraw. Either spend the gains or panic at a fall, sell off and tell everyone how bad the market sucks.

No, at 15 years you don't automatically win. That's nonsense.

A person taking your advice in January 2000 averages a 2.5% return over the next 15 years. So you've made 2.5% while the person paying off debt made 3.5%. Now he gets to invest 50% more in a market making 11% the next 10 years. You win if there's not those economic downturns that happen with some regularity.

 

[MtnHusker]

 

[1HuskerDad]

 

[1HuskerDad]

 

[1HuskerDad]

 

[1HuskerDad]

 

[1HuskerDad]

 

[Jim14510]

No, at 15 years you don't automatically win. That's nonsense.

A person taking your advice in January 2000 averages a 2.5% return over the next 15 years. So you've made 2.5% while the person paying off debt made 3.5%. Now he gets to invest 50% more in a market making 11% the next 10 years. You win if there's not those economic downturns that happen with some regularity.

You can check my math/assumptions.

Buy a house with a loan of 100k 12/1/93.

I do a 30 year loan at 3.5%. My payment is $449.

You do a 15 year loan at 3%. Your payment is $691.

So I'm investing $242 per month for 30 years. You're investing nothing for 15 years and then $691 per month for 15 years.

Your example was 12/1/00-12/1/15. S&P 500 return was 2.3%. Obviously 2030 isn't here yet so instead going backward from 12/1/23. 12/1/93-12/1/08 return was 3%. 12/1/08-12/1/23 13%.

So again I invest $242 every month for 30 years. Average return is 3% for the first 15 and 13% for the next 15. At 12/1/23 my house is paid off and I have 517k in investments.

You pay on your house for the first 15 years and start investing $691 per month. At 30 years you have 384k.

Yes at the 15 year mark you have your house paid off. I have a balance on my loan of 63k and investments of 55k so I am temporarily behind you. But I have 55k already invested when the market turns.

Over a 30 year loan I am going to win. I risk having periods of time in the middle that I'm slightly behind but it's not far. Not when rates are that low. I will leverage every bit of the house at 3.5% assuming I'm not retirement age. I don't care about having debt during retirement but I'm not taking additional debt at that point even if it does make sense.

Granted I'm doing something more fun than invest it in the market. Trying to flip houses and eventually vacation homes but this is all for arguments sake.

2.3% return for the first 15 changes the 15 year mark by a couple thousand and 30 year mark by about 10k. Still well over your measly 384k. I'm sure there's a 30 year example that's closer but I can't see losing.

 

[1HuskerDad]

 

[1HuskerDad]