Money-Saving Tips from Tibs and Shell

[Astreja]

I don't know if I could go back to apartment living. I have noisy hobbies (and plans to buy a tenor sax, a new flute, and 2 more clarinets).

For mortgages, I've found that a 15-year amortization is the sweet spot between paying down the principal and still having money to live on. Paid off the house last June and am putting some extra money into retirement savings now.

As far as day-to-day economy goes, the worst habit I had was eating out much too often. I had a lot of unexpected and/or extraordinary expenses during the summer and fall (veterinary bills, air conditioner repair, and a wedding trip plus gift), so by necessity I cut back drastically on both fast food and junk food. It took about a month and a half to settle into the new pattern, and now it feels strange if I do go out. It's been scaled back to usually just a coffee and pastry, and generally when I'm going out for some other reason.

[Jackalope]

Plant a culinary herb garden.  Have you seen the price of fresh herbs?   Grow that shizz and omnomnom the savings.

I love the fact that you needed the adjective culinary... [emoji14]

My attorney advises me that I have no idea to what you may be referring.

[Edwardo Piet]

I also drink tap water instead of buying bottled water, I believe Alasdair mentioned this too.

I did indeed say that!

You mentioned me. I feel validated.



Oh... I also save a whole bunch of electricity money by not using my heating in the winter and sitting in my bedroom with my jacket and coat on.

I also don't use my lights. I'm a vampire

[Fidel_Castronaut]

I'm with you, operator. Tibs and I have been talking about home ownership, but it was never something I was interested in because of the size of the purchase and the implications. Staying still for the rest of my life? No fucking way. I've ready plenty of financial advice that actually says it's cheaper to rent in the long run if you plan on moving a lot. The cost of selling house every time you move is too high to balance it out. I'm considering it more now because staying still doesn't sound so bad on a big old farmhouse with Tibs. Still freaks me the fuck out.

In the UK it's the opposite. Depending on your deposit and Loan to value, owning is almost always cheaper. Factor in further that houses as assets, due to fortuitous or unfortunate circumstances of lack of housing stock (depending on which side of the fence you sit in) and much higher demand means that house prices trend up almost regardless of what and where you buy.

An example, my fiancé and I recently bought a home with an LTV of 30%, our mortgage repayments each month are around £500. Factor in insurance, maintenance, and other such direct costs that relate to the upkeep of the property and it still falls short of our current rent in our flat which is £750 (the house is 3 bedrooms, the flat is only 1). Indeed based on property price inflation alone we've probably made a 6% profit already just having bought the place and waited a few months to move in.  

The hardest part is saving the deposit. We were lucky in that we invested in years past with money given to us by family or deceased relatives. I recognise that for most that's not possible. But if you can buy (in the UK), consider the cost benefit relative to renting. You'll come out with more equity if you stay longer than say 5 years with you having paid of some of your mortgage (mortgage payments always pay off interest in the first few years rather than the loan value itself) combined with the predicted increase in your house value (subject to cautions such as price and location and your over all debts to assets, liquidity of those assets and so forth). Plus if you care about things such as legacy for children (I don't) you have an asset to pass down when you pop your clogs.

If you do plan on moving a lot then factor in average agent and conveyancing fees plus taxes such as stamp duty. Average house price in the UK is around £207k (inflated due to London prices which really should be factored out as they are ridiculous l). Average fees and taxes on that are probably going to fall around £4/5k. So that's a lot if you move every few years and you'll probably just break even if you have a modest LTV or live in an area where growth is also modest.

[energizer bunny]

Same here. And by not having a car. Not having a credit card. Booking flights well in advance. Cooking as oppose to eating out. And by staying healthy. Haven't been to a doctor since 2006 and haven't been to a dentist since 2004. And no, i don't have bad breath.   My teeth and body is healthy.

Um, you should still go for checkups though.

Nah, never felt the need to.

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I can't do that not using heat as a way for saving money. I need to be comfortable in my own home. I don't deal with the cold well. The heat i can take.

[brewer]

For you land line (like) people, magicjack. $50/year.

[Shell B]

The more I look into the amount of interest you pay on a house, the more I don't want to do it.

[Tonus]

The way they structure it is what really can sour a potential buyer. You pay most of the interest up front and only chip away at the principal at first. Works beautifully if you're the bank...

[Shell B]

The way they structure it is what really can sour a potential buyer.  You pay most of the interest up front and only chip away at the principal at first.  Works beautifully if you're the bank...

That's just insane. You could pay out a ton and have nothing yet to show for it. It's like paying interest on money you haven't even received yet. Sure, you live in the house, but you're essentially only paying rent on it for however long that takes. Ugh. I'm really considering buying a cheap house and then saving all of our money for a few years until we can buy a better house.

[brewer]

The way they structure it is what really can sour a potential buyer.  You pay most of the interest up front and only chip away at the principal at first.  Works beautifully if you're the bank...

That's just insane. You could pay out a ton and have nothing yet to show for it. It's like paying interest on money you haven't even received yet. Sure, you live in the house, but you're essentially only paying rent on it for however long that takes. Ugh. I'm really considering buying a cheap house and then saving all of our money for a few years until we can buy a better house.

The interest is a tax deduction. 

Not sure what it's like in the Boston area but here you can buy a house just as cheap as rent a house and build equity. 

Just look at the house payment like a credit card payment, you never pay the minimum. You pay extra each month and tell the bank (and you do have to tell the bank) that the extra goes to the principle. Try to make twice the monthly payment in principle payment each year.