Getting a Mortgage When You Have Assets But No Income
.Getting a Mortgage When You Have Assets But No Income
Posted by Darrow Kirkpatrick | Aug 28, 2017 | Real Estate, Retiring
Most early retirees have no pension, annuity, or Social Security income. Even if you’re a traditional retiree, you might have only one of those income streams. But what if your lifestyle plans require a home purchase? Even if you have the savings to afford a house, you might not necessarily be able to liquidate enough of those assets quickly in a tax efficient manner. So you’ll need a mortgage. But most conventional mortgage loans are based on income. If you can’t show income, how do you go about getting a mortgage?
When we retired, downsized, and moved west I swore I’d never own another house. My post about our move across the country spells out the high quality of life we’ve achieved as renters — without the obligations of home ownership.
Getting a Mortgage When You Have Assets But No Income
Posted by Darrow Kirkpatrick | Aug 28, 2017 | Real Estate, Retiring
Most early retirees have no pension, annuity, or Social Security income. Even if you’re a traditional retiree, you might have only one of those income streams. But what if your lifestyle plans require a home purchase? Even if you have the savings to afford a house, you might not necessarily be able to liquidate enough of those assets quickly in a tax efficient manner. So you’ll need a mortgage. But most conventional mortgage loans are based on income. If you can’t show income, how do you go about getting a mortgage?
When we retired, downsized, and moved west I swore I’d never own another house. My post about our move across the country spells out the high quality of life we’ve achieved as renters — without the obligations of home ownership.
My article about renting vs. buying — one of the most popular on this site — lays out a procedure for analyzing the rent vs. buy decision. It’s a financial analysis that, in today’s world, is by no means guaranteed to support buying as the superior option….
But I have never denied the emotional benefits of home ownership. There is an element of control and security in owning the property where you live. I’m not immune to that feeling. We owned our home for the 17 years we were raising our son in Tennessee, and were content. But, for the past four years, other factors have clearly made renting the better choice for us.
Now, the scales may be tipping as we get visibility into later stages of retirement. The prospect of home ownership has again dawned. Up to now, we have loved our vagabond lifestyle, traveling the west from our home base in Santa Fe. Buying a home now would be a tacit acknowledgment that we were “settling down” in one place for our retirement. But this would be no snap decision for us. Our financial independence hinges on keeping our nest egg working hard. We can’t afford a six-digit mistake.
And, if we were to buy a home, another problem presents itself: We can well afford it, on paper, but where would we get the cash? Yes, we do keep a few years of living expenses on hand. But we don’t have any more than that lying around. The proceeds from our previous home sale in Tennessee have long since been folded into our growing portfolio. And, our other investment positions go back many years. So we can’t sell assets without incurring large capital gains taxes. This all means we would need a mortgage….
To continue reading, please go to the original article here:
https://www.caniretireyet.com/getting-a-mortgage-when-you-have-assets-but-no-income/
It's OK To Say "NO"
Reposted for our newest members:
(Note: This Article can apply to Lotto-Winners, A Big Inheritance and Dinarians!)
A good read about saying "No"
This story appears in ESPN The Magazine's Dec. 8 Big Money Issue. S
HERE'S A CHALLENGE: Imagine what it feels like to be 21 years old, extremely successful, famously wealthy, wildly stressed and unbearably miserable. How, you might wonder, can all those conditions exist simultaneously?
Start here, with Cowboys All-Pro offensive tackle Tyron Smith, talking to his mother on the phone one day in 2012, his second year in the NFL, during a time of growing tension between him
"We've found a house," Frankie Pinkney told her son.
By this stage, wariness had become as intrinsic to Smith's identity as his brown eyes and bookcase shoulders. Silently, he awaited details. He had agreed to purchase a home in Southern California for his mother and stepfather. They would live in it; he would own it as an investment.
Reposted for our newest members:
(Note: This Article can apply to Lotto-Winners, A Big Inheritance and Dinarians!)
A good read about saying "No"
This story appears in ESPN The Magazine's Dec. 8 Big Money Issue. S
HERE'S A CHALLENGE: Imagine what it feels like to be 21 years old, extremely successful, famously wealthy, wildly stressed and unbearably miserable. How, you might wonder, can all those conditions exist simultaneously?
Start here, with Cowboys All-Pro offensive tackle Tyron Smith, talking to his mother on the phone one day in 2012, his second year in the NFL, during a time of growing tension between him
"We've found a house," Frankie Pinkney told her son.
By this stage, wariness had become as intrinsic to Smith's identity as his brown eyes and bookcase shoulders. Silently, he awaited details. He had agreed to purchase a home in Southern California for his mother and stepfather. They would live in it; he would own it as an investment.
The agreed-upon budget was roughly $300,000, but over the course of the conversation, Frankie dropped the bomb. List price: more like $800,000.
Smith, now 23, is sitting at a polished wood table in the conference room of his lawyer's Dallas office. Surrounded by his girlfriend, accountant and lawyer, he fixes his eyes on a spot somewhere high on the floor-to-ceiling window. "Yeah, my parents wanted a house," Smith says. "But it was way bigger than mine and cost way more than mine."
It's not an easy topic for Smith to discuss -- recounting the conversation appears to be nearly as hard as being on the phone in the first place. He long ago gave up trying to pinpoint when it all went wrong, when the combination of family and money turned corrosive, when one ceased to exist without the other. He recites facts, stripped of emotion, as if determined to turn a painful time in his life into an after-action report.
"That call," he says. "That was the point where I said, 'That's enough.'"
At that precise moment, as he hung up the phone without giving his mother assent or encouragement, something hardened inside him. Reclaiming his finances, that was the easy part. Demystifying his new life -- being something other than a conduit for the wishes of those around him -- that was more complicated.
It works like this: We lack the linguistic dexterity to explain the myriad paths of young men who emerge from poverty -- or a simple lack of privilege -- and achieve riches by playing a game. When words fail us, a creation myth must fill the void, and so the modern professional athlete becomes our Sedna, a massive woman of Inuit legend who lives at the bottom of the ocean, controlling the underworld by providing fish to keep her people from going hungry. Our version of Sedna frees himself from the streets -- the temptations, the poverty, the turbulent flow of every Bad Part of Town -- through a ceaseless, unquenchable devotion to his sport. Visions of The Escape accompany every rep on the bench press, every free throw in an empty gym. In short, his life is a series of made-in-Akron, Beats by Dre moments.
Yes, he will rise up to leave it all behind, but here's where the mythological sleight of hand appears: He'll bring it all with him too. He can't forget where he came from. The myth mandates loyalty and strikes down the ingrate.
And all those people who toiled alongside, those who believed in him and sheltered him and sacrificed for him? They'll also come along, for he's the sin-eater, absorbing all debts -- moral and financial -- so others can be absolved. And his people will never go hungry again.
Jeff Wilson His family's demands for money isn't an easy topic for Smith to discuss.
IT LONG AGO became easier for an athlete to subscribe to this myth than to defy it with his personal story. Easier to nod and smile and tacitly agree to be a benign receptacle for our society's need to bundle its fairy tales into color-coded boxes. Why else would newly minted professional athletes -- and let's cut the pretense: It's nearly always young black athletes -- invariably be asked whether they've bought their mother a new house? Or a new car? Or both? Does anyone know whether Aaron Rodgers moved his stay-at-home mother and chiropractor father out of their Chico, California, home and into a beach mansion? Has anyone ever thought to ask?
But could it be possible, ever so slightly possible, that athletes who come from similar backgrounds can have wildly dissimilar stories?
Smith's story is best told chronologically. And it begins, as so many do, in a van filled with cleaning supplies rattling down a desolate highway somewhere in the Mojave Desert.
Smith spent much of his elementary school years working for the family business. Pinkney's Cleaning Service specialized in cleaning new buildings after construction was complete but before tenants moved in. Family members would often climb into that van, drive from their home in Moreno Valley, California, to Phoenix or Sacramento or anywhere in between, clean a building and then pile back into the van for a return drive that could last seven hours. They'd pull into the driveway at 4 or 5 a.m., and Tyron and his five siblings -- a mixture of half brothers, half sisters, stepbrothers and stepsisters -- would be at school by 8.
Introspective and shy, bigger than his peers, Tyron felt detached, like an asset rather than a son, someone valued primarily for his ability to clean tall windows. The detachment might have been rooted in a moment he was too young to remember: the death of his father, Jerry Lee Smith, when Tyron was a year old. Tyron was told that Jerry Lee was murdered and that someone is in prison for the crime, assertions he's been unable to substantiate.
"Growing up, it's hard to feel separated," he says. "You don't know which direction to go. ... It got really complicated. I was the one who always asked, 'Can I get my own job? Can I do my own thing?' I didn't want to work in the janitorial business my whole life."
Smith doesn't remember watching football as a kid; he had neither the time nor the inclination. He was too big for Pop Warner, and besides, there were van rides to take and windows to reach. But he began to play in high school, and his size and natural ability immediately meshed with his work ethic. He didn't so much find football as it found him. He was huge and nimble, eventually reaching 6-foot-5 and 310 pounds, and by his junior year everyone had a pretty good idea where this was headed.
He was excused from janitorial work if he had a weekend camp to attend, and he remembers thinking, "It was a little weird they let me do my own thing." When he's asked if that created friction between him and his siblings, he says, "It probably did, but I never knew about it." It sounds like the first time this possibility has occurred to him.
Was this the beginning of Tyron's embrace of the myth? When he climbed into the van after Friday night games, heading for another empty building, did he close his eyes and dream of The Escape, when he could direct schools of fish to the surface and rid everyone of this burden?
"When I was out there, I was just enjoying playing," Smith says. "For me, playing a sport was my own space, away from reality. You don't have to worry about anything because you're out there, and you can just play freely."
He did it well enough to earn a scholarship to USC, and in his junior season, something shifted in the family dynamic. NFL decision makers began seeing Smith, with his 85-inch wingspan and sub-5.0 speed in the 40, as a potential first-round pick in the 2011 draft. The conversation at home took on a sharper edge. Family members wondered how much he might get and what percentage of that they might get. There was talk of cars and houses and jewelry. "All of a sudden, people's perception of me started to change," Smith says.
As Leigh Costa, Smith's girlfriend, puts it, "He's always told me he felt like nobody ever really cared about him until coaches started saying, 'You could be really good.'"
HE PLAYED ALONG with the myth. Everyone else was, so what choice did he have? When he was chosen No. 9 in the draft, he was 20, the youngest player in the NFL. He signed a four-year, $12.5 million contract, bought his mom a Range Rover and vowed to pay off his parents' mortgage and retire the family's debts. "I didn't think I owed them anything," Smith says. "I just really wanted to help out. I know how hard the struggle is, and growing up we always had to worry about debt. That was my thing: Use this money to pay off your house, pay your debt and be free of all that stuff."
Later, Smith discovered the money he provided wasn't used for those purposes. Asked how it was spent, Smith shrugs, betraying no emotion. "We don't know," he says. A direct line could be drawn connecting that moment to the moment he hung up the phone because it marked the beginning of a gradual erosion of trust and control. His humanity vanished beneath a barrage of requests. He was no longer son or brother or friend. He began to feel like a human Santa list, robbed of his capacity to be generous.
"The things that were asked for as gifts shocked me," he says. "All I could think to say was, 'Hey, that sounds really expensive.'"
He paid for airline tickets so strangers and near strangers could accompany his parents to games in Dallas. He paid for game tickets (players get only two comps), parking and food. He paid for hotel rooms or let the guests stay in his home.
"Tyron deferred to the mom, who deferred to the stepdad, who had his own mindset on what he deserved and what he should get," says a family associate with knowledge of the situation. "Tyron's a great kid. He was young and overwhelmed."
And so he relented. The myth, after all, demanded he remember where he came from, and a sort of achiever's guilt took over. His family was still back in Moreno Valley, still doing the job he had worked so hard to avoid. He started to think: Maybe I don't deserve all this money. When his financial adviser would call for authorization to transfer funds to his family, he'd say, "Yeah, just transfer it over." They wore him down. Inside, it tore him up.
Studies indicate that 78 percent of NFL players are bankrupt within two years of retirement. How many of those bankruptcies can be attributed to the gradual erosion of control, the constant drip of family and friends asking for money and the unwillingness to confront it? John Schorsch, Smith's lawyer, estimates that the family received roughly $1 million from Tyron's accounts over one year.
"I'm not trying to be hurtful, but I'm not making this money so other people can live off it," Smith says. "You have to understand: This game doesn't last long at all."
AFTER HIS ROOKIE year, Smith was moved from right tackle to left, a huge promotion in an offensive lineman's world. When he texted his parents to tell them, the response he received did not convey joy or congratulations. Instead, it referenced his next contract and how it would be bigger now that he was playing a more valuable position. "It was hard to have a straight-up conversation," Smith says. "I love my family -- I do -- but I didn't love what they became."
A financial adviser who works with numerous professional athletes says, "As players get more, their families want to be paid more. People lose their humanity. We call some family members 'backup point guards' because that's how they believe they should be paid."
Smith's issues went beyond money. Costa, four years Smith's senior and a former account executive for a Dallas sports radio station, was caught in a story as old as time: She, the newcomer, brunette and pretty, was blamed for separating him from his family and controlling his life and finances. Members of his family allegedly made death threats against her. "I brought her into the middle of all this stuff," Smith says. "They bashed her any way possible, and she didn't do anything wrong."
After his mother's request for the $800,000 home, Smith made a last-ditch effort. He placed a call to Moreno Valley, saying, "I love you all, and you mean the world to me, but all this money stuff is stressing me out. Can we just have a great relationship?"
But the lines had been drawn. "We kept getting voice mails and emails threatening all kinds of things," Costa says. Smith and Costa enlisted Schorsch to handle the legal affairs. They cut ties with Smith's financial adviser and made the myth-defying move of hiring Bill Saplicki, a Dallas accountant who was recommended to Costa and who works primarily with doctors and dentists and precisely one professional athlete.
In the summer of 2012, Schorsch filed to have a protective order placed against Smith's parents and siblings, prohibiting them from having contact with him. The event that precipitated the protective order occurred on June 16 when Smith's mother and stepfather confronted him publicly while he was working at a youth football camp at his alma mater, Rancho Verde High School in Moreno Valley. "We did as little as possible to accomplish as much as possible," Schorsch says. And yet on the night of Saturday, Oct. 27, 2012, with Smith at the team hotel on the eve of a home game against the Giants, two of his sisters arrived unannounced at the home Smith shared with Costa in North Dallas.
The doorbell rang, and Costa looked through the glass in the door and froze.
"You need to let us in this house," one of them said.
"Why?" Costa answered. "You've made threats against my life. I don't know what you have on you right now, and your brother's not here."
Costa said she called the police after the women repeatedly said, "We're not leaving until you let us in." Three days later, on Tuesday afternoon, two of Smith's sisters were among three people who returned to the house. This time, Smith called 911 and police cited the women for disorderly conduct. A Dallas police report noted that Smith's sisters were there to "harass and torment ... in the pursuit of collecting financial gain."
Frankie Pinkney turned down an interview request. She directed questions to her manager, Mark Wayne, who runs an entertainment company with offices in Seattle and New York. Pinkney, according to Wayne's website, is part of a group attempting to sell a reality show called Football Moms. "She's been painted as an extortionist to her own son, which is not true," Wayne says. "There's so much friction between her and her son. She loves her son with all her heart and wants to reunite. I don't think she's had a fair shake."
Wayne refused to elaborate, except to say, "The truth will come out. It's not for me to share; it's for Frankie. She took the heat for a lot of stuff. Her reputation has been damaged."
What is she waiting for? "She needs to heal," Wayne says. "A lot of healing needs to take place."
After a night loss to the Redskins on Oct. 27, Smith exhibits the second-day inertia of an NFL offensive lineman. It's quite a contrast. On game day, he's powerful and punishing, remarkably light on his feet -- like a dancing oak. Two days later, he lowers himself into his chair slowly, as if every vertebra moves independently. "My back -- ooh," he says, wincing. "Really stiff today."
Schorsch has a standard answer when questioned about Smith's financial responsibility to his family. "I am certain none of them ever took a hit for him," the attorney says. "None of them had to get a shot so they could get up and go to work. And they're not entitled to share in this. No matter what they did, they're not taking the risk."
That risk, short- and long-term, is significant. In his fourth year as a pro, Smith has already had a career longer than the NFL average according to the NFL Players Association. He has avoided serious injury but has had periodic ankle issues. Sedna might live forever, but an offensive tackle is not as lucky.
Smith is mellow, with the voice of a late-night DJ on a smooth-jazz station. He is almost allergic to attention; rather than speak to reporters, he sometimes stays in the training room after practice or games while a team employee delivers his clothes. He plays with a composed, almost detached air, like a man at peace with the violence of his profession. (During a game in late October, however, he did trade punches with Giants defensive end Jason Pierre-Paul.) His ability is unquestioned: He is widely considered one of the top three offensive tackles in the game, and for his play against the Seahawks in Week 6, he became the first offensive lineman in 10 years to be named offensive player of the week.
He treats money the way most people treat a gym membership: It's there, and he'll use it if he needs it. In July, he signed an eight-year extension, making his contract now worth a potential $109 million, with $22.1 million of that guaranteed. Many in the business felt the deal was too team-friendly -- Pro Football Talk called it "nuts" -- because it leaves one of the league's brightest young stars with no bargaining power for an entire decade. But the criticism fails to account for Smith's loyalty to Jerry Jones and the Cowboys, whose security team has assisted Smith and Costa and was once called on to remove one of Smith's brothers from the team's training camp in Oxnard, California.
Smith, who drives a Jeep he gets as part of an endorsement deal, values stability
and craves normalcy. When he goes out to a four-star restaurant for a weekly dinner with Cowboys offensive linemen, they tease him for wearing clothes Leigh has chosen. "I have no style whatsoever," he says, holding his hands out to show off his workout shirt, sweats and shower shoes. "The guys know I don't dress myself. I wish it was like the early '90s, when you could wear jumpsuits."
When Costa asks him if he likes something -- whether it's a couch or a shirt or a toaster -- he answers her question with a question. To demonstrate, Smith holds a coffee cup over the table and says, "It could be something as cheap as this mug, and my first question is, 'How much does it cost?'"
"You're very conservative," Saplicki says.
No," Smith corrects. "Cheap."
"I know the amount of money I make in the NFL could be over any day," Smith says. "It has to be put aside for me later down the line or for when I have a family."
Listen to Smith long enough and you'll pick up a pattern: He repeatedly uses the word "work" to describe what he does. He says it so often, it begins to feel intentional, or maybe it's a reflexive response to the weight of his success. The distance between the word "work" and the word "play" is immense: He plays football for a living, while the nonsports world -- the janitorial world, for one -- goes to work. "I saw the daily struggle," he says. "It taught you to live within your means and know what it means to actually earn a dollar."
The demystified truth is this: He suits up for the Cowboys not because he loves football necessarily; he's playing because he's darn good at it. For the love of the gameis largely an external phenomenon anyway, promoted by those who link generational bonding and the passage of time to a particular uniform. No matter how much it gets sexed up -- and in Dallas, in Jerry's world, they do their best -- there is nothing romantic about slamming your massive body into another massive body as a way of making a living. It's exactly what Smith says it is -- work -- and he speculates that half the players in any NFL locker room would walk away from the game if they were offered the same pay to do something else.
Is that heretical? Or is that how myths die and reality survives?
Understand this: Smith wasn't eager to talk. Things are quiet, the way he likes them. The stress is gone. He can go home and hang out with his rescue dogs -- he and Costa have five, including a 110-pound French mastiff named Beast -- and not worry about the next phone call or knock on the door.
But he knows his story is important. When he finishes playing, he's got an idea to travel the country telling it to top college players. He wants them to know that he said no and they can too. He wants them to know it's OK to stand up to the pressures from family and friends. He wants them to take control of their money and understand how long it has to last.
"It's so personal, and nobody really talks about it," Smith says. "'Hey, this sibling or family member is screwing me over.' You won't hear that, but it's a real issue. I'm not trying to bash my family at all, but it's hard to talk about this without doing that. And a lot of people aren't willing to tell their story."
It's getting late. The traffic in the throbbing Metroplex, 13 floors below, is starting to ease. Smith begins the process of standing, his back working like an elevator in a fleabag motel, refusing to be rushed. The men in suits stand at his sides like reverse bodyguards, and Smith says, "It's OK to say no," as if to remind himself one more time.
People Who Are Good With Money Avoid These Missteps
.People Who Are Good With Money Avoid These Missteps
By Jake Schroeder
While there are hundreds of potential mistakes people might make with money, there are some financial moves that can really set you back. Between bad habits and wishful thinking, poor financial choices can happen all the time. This round-up can serve as your guide for what not to do when it comes to personal finance. From not saving for retirement to living beyond your means, here are some things that people who are financially stable don’t do.
Lose Track of Money
Money isn’t infinite. That’s why it’s important to keep track of where you’re spending it. If you don’t know where your money is going, it’s easier to waste it. Let’s say you’re paying for subscription services you don’t use. Before long, you’ve spent $1,000 on music streaming, and you had no idea. That $1,000 you didn’t use could’ve paid down a credit card.
People Who Are Good With Money Avoid These Missteps
By Jake Schroeder
While there are hundreds of potential mistakes people might make with money, there are some financial moves that can really set you back. Between bad habits and wishful thinking, poor financial choices can happen all the time. This round-up can serve as your guide for what not to do when it comes to personal finance. From not saving for retirement to living beyond your means, here are some things that people who are financially stable don’t do.
Lose Track of Money
Money isn’t infinite. That’s why it’s important to keep track of where you’re spending it. If you don’t know where your money is going, it’s easier to waste it. Let’s say you’re paying for subscription services you don’t use. Before long, you’ve spent $1,000 on music streaming, and you had no idea. That $1,000 you didn’t use could’ve paid down a credit card.
Keep track of your spending, expenses, debts and investments. This doesn’t have to consume a lot of your time, but keeping track will ensure you’re going in with your eyes wide open. You should know where your money is and where it’s going.
Buy Houses They Can’t Afford
Being house poor isn’t a good look. This term refers to someone who uses most of their income on a housing payment. If you pay more for a house than you can actually afford, you’re putting yourself at risk financially.
Buying a house that you can’t really afford means you’re holding a lot of debt and making larger mortgage payments. The money you’re earning is all going to your mortgage instead of a savings account or a retirement fund. People who are good with their money understand that it’s better to stay within your means when it comes to housing.
Overspend on Credit Cards
Overspending on credit cards is one of the biggest financial mistakes someone can make. If you have too high of a credit card balance, you may be heading down a slippery slope. If you can’t make your payments, then you’ll also be subject to expensive late fees and interest charges.
Financially savvy people understand the importance of keeping their credit card debt low. You’ll save a ton of money on interest, and you won’t need to pay extra fees or late charges. The lower your credit card debt is, the higher your credit score will be, too.
Invest Money They Can’t Lose
To continue reading, please go to the original article here:
How to Spot Counterfeit Money
.How to Spot Counterfeit Money
How can you tell if money is fake? Check the bills in your wallet with these methods.
By Geoff Williams | July 21, 2021 U.S. News & World Report
Checking counterfeit money light. 100 dollars against the window in his hand. Check for watermark on new hundred dollar bill. translucence of the American currency.
If you hold the bill toward the light and there's no watermark or if you can see the watermark even without holding it up toward the light, then the bill you're holding is probably a counterfeit.(GETTY IMAGES)
It would be easy to assume that it's rare to encounter counterfeit money. After all, plenty of people rely on credit and debit cards and even cryptocurrency, and go long stretches of time without touching a dollar bill or quarter. But cash isn’t exactly dead yet. Every week, it seems, counterfeiters make news throughout the country.
How to Spot Counterfeit Money
How can you tell if money is fake? Check the bills in your wallet with these methods.
By Geoff Williams | July 21, 2021 U.S. News & World Report
Checking counterfeit money light. 100 dollars against the window in his hand. Check for watermark on new hundred dollar bill. translucence of the American currency.
If you hold the bill toward the light and there's no watermark or if you can see the watermark even without holding it up toward the light, then the bill you're holding is probably a counterfeit.(GETTY IMAGES)
It would be easy to assume that it's rare to encounter counterfeit money. After all, plenty of people rely on credit and debit cards and even cryptocurrency, and go long stretches of time without touching a dollar bill or quarter. But cash isn’t exactly dead yet. Every week, it seems, counterfeiters make news throughout the country.
In Casper, Wyoming, the police are investigating phony $100 bills circulating. Counterfeit money recently turned up in Hartville, Ohio. Counterfeit cash was also passed at businesses in Lubbock, Texas. A local band in Richland, Washington, received four fake $100 bills in their tip jar.
So, yes, counterfeit crime is still very much a thing, and if you use cash in your day-to-day life, or even just occasionally, it may pay off to know the signs of counterfeit bills. If you want to know if your U.S. dollars are real or fake, use these methods.
Evaluate the Feel of the Paper
This observation is based on gut instinct.
“Most counterfeits are identified by the feel of the paper,” says L. Burke Files, president of Financial Examinations & Evaluations, a firm that does investigations, risk management and other types of consulting in Tempe, Arizona. Generally, fake money, he says, “does not have the crisp money feel and the raised feeling of the black ink on the front of the bills."
Files, who has been a financial investigator for 30 years, says that counterfeit money – in all countries throughout the world – is a problem. He also says that quite a few business owners unfortunately appear to accept – and pass on – counterfeit dollars knowing they’re fake.
“As one person told me, it only becomes bad when someone fails to take it,” Files says.
It's easy to imagine why a business owner might knowingly pass on a counterfeit bill. Often, when a business owner or consumer turns in counterfeit money to the authorities, they aren't reimbursed for that bill.
To continue reading, please go to the original article here:
https://money.usnews.com/money/personal-finance/articles/2013/04/25/how-to-spot-counterfeit-money
How Much House Can You Really Afford?
.How Much House Can You Really Afford?
Posted by Darrow Kirkpatrick Mar 1, 2021
Google “How much house can I afford?” and you’ll be awash in a sea of mortgage lenders. This is the mindset that younger people and the average consumer must take when it comes to buying a home: How much will a financial institution loan to me? And many, sadly, make their financial decisions based on how much they can borrow. They assume that you would want the maximum allowed.
How much house can I afford image with calculator
But FIRE-oriented folk, potential early retirees, and the financially independent are likely to look at the problem from other, different perspectives. The first might be, how modest a house can I live in, and still be happy? Another perspective might be, how will this impact my budget and savings rate long-term? A final perspective, since many in that group can afford to pay cash, is not how much will my income qualify me to borrow, but rather how much of my net worth can I sink into a house without taking on undue risk or compromising my cash flow?
How Much House Can You Really Afford?
Posted by Darrow Kirkpatrick Mar 1, 2021
Google “How much house can I afford?” and you’ll be awash in a sea of mortgage lenders. This is the mindset that younger people and the average consumer must take when it comes to buying a home: How much will a financial institution loan to me? And many, sadly, make their financial decisions based on how much they can borrow. They assume that you would want the maximum allowed.
How much house can I afford image with calculator
But FIRE-oriented folk, potential early retirees, and the financially independent are likely to look at the problem from other, different perspectives. The first might be, how modest a house can I live in, and still be happy? Another perspective might be, how will this impact my budget and savings rate long-term? A final perspective, since many in that group can afford to pay cash, is not how much will my income qualify me to borrow, but rather how much of my net worth can I sink into a house without taking on undue risk or compromising my cash flow?
Is the answer to that question essentially the same as for the borrower, who is qualifying based on income? Or is it somehow different, when you are buying a home outright? When I was faced with the home buying decision late last year, I had to answer this question for myself….
Qualifying for a Mortgage
Let’s take a look at the constraints on housing deals using traditional mortgages. As we’ve said, the lens through which the vast majority of people look at home affordability is simply, how large a mortgage can they qualify for? Not surprisingly, the mortgage industry has a well-tested rule of thumb for making the determination. It’s known as the “28/36” rule.
According to FreddieMac, and many other mortgage resources, you should take on no more than 28% of your monthly gross (pre-tax) income in a mortgage payment — principal, interest, property taxes, home insurance. (Note that maintenance and utilities are not included in that number, whereas HOA dues might be.)
The relation of mortgage payment to gross income is known as the “front-end ratio”. It’s found by dividing your monthly housing expenses by your gross income and multiplying by 100. Some underwriters allow higher percentages, and some require lower. I’ve seen ratios as low as 25% and as high as 30%. But 28% is the most common rule.
For most people, “gross income” would just be wages. For a retiree, it would be the combination of pensions, Social Security benefits, and perhaps investment withdrawals, using a conservative safe withdrawal rate. Individual institutions are likely to have their own rules for getting a mortgage based on assets.
The 36% number is known as the “back-end ratio.” It’s the suggested upper limit once you add in monthly payments on all other debt to your housing expenses and divide by your gross income. This is an attempt by your creditors to keep your overall debt manageable.
The Sweet Spot?
To continue reading, please go to the original article here:
https://www.caniretireyet.com/how-much-house-can-you-really-afford/
What It Means To Be Rich
.What It Means To Be Rich
Posted July 25, 2021 by Ben Carlson
My wife and I have a good system of divide and conquer when necessary so the next morning I took the kids for a family bike ride to get them out of the house to give her some peace and quiet after a rough night. On our bike ride we approached an older couple that was walking in the opposite direction. The woman, who looked like she may have had grandchildren based on the way she smiled at my kids, said to me, “You’re a very rich man.” Here I was feeling sorry about myself because I was tired from the night before and this stranger hits me with a perspective bomb out of nowhere.
I love the way she put this. She didn’t say I was lucky or blessed or had my hands full (I get that a lot with twins). She said I was rich which is not the way I ever looked at this before.
What It Means To Be Rich
Posted July 25, 2021 by Ben Carlson
My wife and I have a good system of divide and conquer when necessary so the next morning I took the kids for a family bike ride to get them out of the house to give her some peace and quiet after a rough night. On our bike ride we approached an older couple that was walking in the opposite direction. The woman, who looked like she may have had grandchildren based on the way she smiled at my kids, said to me, “You’re a very rich man.” Here I was feeling sorry about myself because I was tired from the night before and this stranger hits me with a perspective bomb out of nowhere.
I love the way she put this. She didn’t say I was lucky or blessed or had my hands full (I get that a lot with twins). She said I was rich which is not the way I ever looked at this before.
There are many ways to be rich beyond the amount of money you have in your investment portfolio or checking account. Plenty of people have a lot of money in the bank but terrible personal lives.
Having millions of dollars wouldn’t come close to providing the same feeling I got this past week watching my 7-year old scale a rock wall like a champ or confidently walk up to do a high ropes course with zero signs of trepidation or fear.
Huge gains in the stock market can’t possibly match watching my little guy ride his bike for the first time this summer.
No amount of money can melt my heart the way my youngest daughter does when she says something sweet to me out of the blue.
Being a parent is not always easy. At times there is chaos, yelling, screaming, crying, fighting, pouting and puking. But there’s also laughing. Lots of laughing. And smiling. And joy. For me, having kids is like setting a constant memory factory in motion.
Obviously, there are other ways to be rich that extend beyond family.
To continue reading, please go to the original article here:
https://awealthofcommonsense.com/2021/07/what-it-means-to-be-rich/
Too Smart
.Too Smart
Jul 13, 2021 by Morgan Housel
“One of the most persistent fallacies is the reflexive association of wealth with wisdom,” Ed Borgato once wrote.
Wealth might be a sign of good decisions, but can those decisions be repeated? And do good decisions in one field translate to wisdom in other areas of life? Maybe, maybe not – that’s the best we can say. And there are times where exceptional wealth can prevent empathizing with ordinary people, making insight more precarious.
A similar mistake, a bit harder to grasp, is the assumption that smart people have the right answers.
They may. But does intelligence in one field convert to others? Does being good at taking tests translate to, say, leading groups of people?
Maybe. It’s never clear.
Too Smart
Jul 13, 2021 by Morgan Housel
“One of the most persistent fallacies is the reflexive association of wealth with wisdom,” Ed Borgato once wrote.
Wealth might be a sign of good decisions, but can those decisions be repeated? And do good decisions in one field translate to wisdom in other areas of life? Maybe, maybe not – that’s the best we can say. And there are times where exceptional wealth can prevent empathizing with ordinary people, making insight more precarious.
A similar mistake, a bit harder to grasp, is the assumption that smart people have the right answers.
They may. But does intelligence in one field convert to others? Does being good at taking tests translate to, say, leading groups of people?
Maybe. It’s never clear.
And like wealth, there are situations where people become too smart for their own good, where intelligence is a liability and blocks good decisions.
A few causes:
The ability to create complex stories makes it easy to fool people, including yourself.
I know people I would not want to debate with on the question, “What is 2 + 2?” because they could go down a rabbit hole that’s over my head and leave me either exhausted or convinced the answer may not be four.
The dangerous thing is that those people can do the same things to themselves.
Richard Feynman said, “The first principle is that you must not fool yourself — and you are the easiest person to fool.” The smarter you are I think the truer that becomes.
When you’re blessed with intelligence you’re cursed with the ability to use it to concoct intricate stories about why things happened – especially stories justifying why you made a mistake or why you’ll eventually be right in an area you’re wrong.
To continue reading, please go to the original article here:
20 Home Renovations That Will Hurt Your Home’s Value
.20 Home Renovations That Will Hurt Your Home’s Value
You might love these renovations, but they'll cost you.
By Autumn Rose July 21, 2021
Your home isn't just a source of pride or a place where you can relax after a long day -- it's also an investment in your family's future.
And while it's natural to want to make improvements to increase your home's resale value, some renovations will actually cost you money in the long run. Just because you see something as an improvement doesn't mean a potential buyer will feel the same way. Find out which renovations are ones to avoid.
Lavish Lighting Fixtures
One common home improvement mistake is falling in love with unique or lavish light fixtures, said Alon Barzilay, founder of real estate development company Urban Conversions.
20 Home Renovations That Will Hurt Your Home’s Value
You might love these renovations, but they'll cost you.
By Autumn Rose July 21, 2021
Your home isn't just a source of pride or a place where you can relax after a long day -- it's also an investment in your family's future.
And while it's natural to want to make improvements to increase your home's resale value, some renovations will actually cost you money in the long run. Just because you see something as an improvement doesn't mean a potential buyer will feel the same way. Find out which renovations are ones to avoid.
Lavish Lighting Fixtures
One common home improvement mistake is falling in love with unique or lavish light fixtures, said Alon Barzilay, founder of real estate development company Urban Conversions.
"Whether it be ceiling-mounted lights in a dining room or a hanging pendant, there is a psychological phenomenon that happens when you go to a lighting store … you're going to pick something exciting and new instead of picking a new addition that suddenly matches the big picture," Barzilay said.
Further, the passage of trends works against homeowners. "Whatever is in vogue today will look dated 10 years down the road when you are ready to sell," he said. "Simple is best. Fortunately, lighting can easily be switched out at a low cost."
Too Much Wallpaper
With its patterns and texture, wallpaper can be an overwhelming design choice for your home. Plus, it's notoriously difficult to remove. Homebuyers might view wallpaper removal as a potential headache, and it could be the tipping point for someone who wants a more move-in ready home.
Fresh paint and neutral colors are always a good idea to help stage your home when it's on the market. If you do have wallpaper, think about whether it's beneficial to remove it and repaint the walls before any showings or open houses, so your potential buyers never have to think about your wallpaper mistakes.
Texture on the Walls and Ceilings
Just like wallpaper, texture on walls and ceilings is difficult to remove. Simply knowing that a time-consuming project lies ahead might cause homebuyers to decrease their offer. Think twice before deciding on a fancy textured painting technique, and play around with textured wall décor instead.
Quirky Tiling
Any over-personalized renovation can hurt the value of a home, especially something like tiling, which requires more effort and money to replace, said Bob Gordon, realtor and blogger at Boulder Real Estate News.
"Many buyers like to upgrade the floors in their homes," he said. "Adding tile or wood can make an improvement in value -- unless you get that person who wants the 1950s diner look and installs black-and-white tile. For their vision, this is the pinnacle of cool. But for a resale value, most homebuyers will see it as a distraction and something they will need to rip out."
To continue reading, please go to the original article here:
https://www.gobankingrates.com/investing/real-estate/home-renovations-hurt-homes-value/
17 Dumb Home-Buying Mistakes That Hurt Your Wallet
.17 Dumb Home-Buying Mistakes That Hurt Your Wallet
Take your time making the biggest purchase of your life.
By Daria Uhlig June 29, 2021 Real Estate Investing 101
Of all the investment decisions you're likely to make in your lifetime, a home purchase is by far the most personal. It's no wonder that buyers are eager to rush right into the real estate market the moment they realize they're in a position to buy. But because the purchase will likely be the most expensive one you ever will make, it's important to organize your priorities and your finances before you jump in.
Keep reading to learn about home-buying mistakes that can hurt your wallet — and steps you can take to avoid them.
Ignoring Your Credit
Strong credit can save you thousands of dollars in interest over the life of your mortgage loan. Credit problems can take time to resolve, so the earlier you start reviewing your credit, the better. The first step is to order a credit report.
17 Dumb Home-Buying Mistakes That Hurt Your Wallet
Take your time making the biggest purchase of your life.
By Daria Uhlig June 29, 2021 Real Estate Investing 101
Of all the investment decisions you're likely to make in your lifetime, a home purchase is by far the most personal. It's no wonder that buyers are eager to rush right into the real estate market the moment they realize they're in a position to buy. But because the purchase will likely be the most expensive one you ever will make, it's important to organize your priorities and your finances before you jump in.
Keep reading to learn about home-buying mistakes that can hurt your wallet — and steps you can take to avoid them.
Ignoring Your Credit
Strong credit can save you thousands of dollars in interest over the life of your mortgage loan. Credit problems can take time to resolve, so the earlier you start reviewing your credit, the better. The first step is to order a credit report.
You're entitled to one free report per year from each credit bureau, which you can order from AnnualCreditReport.com. However, through April 2021, all three credit bureaus — TransUnion, Equifax and Experian — are offering a free weekly online report to help you stay on top of your credit during the COVID-19 pandemic.
If you spot signs of trouble or inaccuracies, contact the appropriate credit bureau as soon as possible. Things to look for include:
Outdated information, such as a closed account that's being reported as open
Incorrect contact information
Accounts you didn't open
Accounts listed multiple times
Also, be on the lookout for old collection accounts you need to pay off. If you moved, for example, your final utility bills might not have reached you and a balance could remain, even though the account is closed.
House Hunting Without a Buyer's Agent
It might be tempting to go at it alone, armed with information available on the real estate portal sites. That could be a big mistake. Online sites let buyers view the inventory of properties on the market, but they aren't a substitute for a professional's knowledge.
A buyer's agent who knows your local market can prepare a comparative market analysis to determine an appropriate offer price for the home you're most interested in. They'll also negotiate on your behalf to make sure your best interests are protected.
In many cases, your buyer's agent is your only fiduciary in the real estate transaction, meaning the agent is the only professional you'll work with who has a legal obligation to put your interests above their own. What's more, the seller typically pays the buyer's agent, so you've got nothing to lose by arming yourself with professional representation.
Shopping With Your Heart vs. Your Head
To continue reading, please go to the original article here:
https://www.gobankingrates.com/investing/real-estate/mistakes-avoid-shopping-new-home/
20 Home Renovations That Will Hurt Your Home’s Value
.20 Home Renovations That Will Hurt Your Home’s Value
You might love these renovations, but they'll cost you.
By Autumn Rose July 21, 2021
Your home isn't just a source of pride or a place where you can relax after a long day -- it's also an investment in your family's future.
And while it's natural to want to make improvements to increase your home's resale value, some renovations will actually cost you money in the long run. Just because you see something as an improvement doesn't mean a potential buyer will feel the same way. Find out which renovations are ones to avoid.
Lavish Lighting Fixtures
One common home improvement mistake is falling in love with unique or lavish light fixtures, said Alon Barzilay, founder of real estate development company Urban Conversions.
20 Home Renovations That Will Hurt Your Home’s Value
You might love these renovations, but they'll cost you.
By Autumn Rose July 21, 2021
Your home isn't just a source of pride or a place where you can relax after a long day -- it's also an investment in your family's future.
And while it's natural to want to make improvements to increase your home's resale value, some renovations will actually cost you money in the long run. Just because you see something as an improvement doesn't mean a potential buyer will feel the same way. Find out which renovations are ones to avoid.
Lavish Lighting Fixtures
One common home improvement mistake is falling in love with unique or lavish light fixtures, said Alon Barzilay, founder of real estate development company Urban Conversions.
"Whether it be ceiling-mounted lights in a dining room or a hanging pendant, there is a psychological phenomenon that happens when you go to a lighting store … you're going to pick something exciting and new instead of picking a new addition that suddenly matches the big picture," Barzilay said.
Further, the passage of trends works against homeowners. "Whatever is in vogue today will look dated 10 years down the road when you are ready to sell," he said. "Simple is best. Fortunately, lighting can easily be switched out at a low cost."
Too Much Wallpaper
With its patterns and texture, wallpaper can be an overwhelming design choice for your home. Plus, it's notoriously difficult to remove. Homebuyers might view wallpaper removal as a potential headache, and it could be the tipping point for someone who wants a more move-in ready home.
Fresh paint and neutral colors are always a good idea to help stage your home when it's on the market. If you do have wallpaper, think about whether it's beneficial to remove it and repaint the walls before any showings or open houses, so your potential buyers never have to think about your wallpaper mistakes.
Texture on the Walls and Ceilings
Just like wallpaper, texture on walls and ceilings is difficult to remove. Simply knowing that a time-consuming project lies ahead might cause homebuyers to decrease their offer. Think twice before deciding on a fancy textured painting technique, and play around with textured wall décor instead.
Quirky Tiling
Any over-personalized renovation can hurt the value of a home, especially something like tiling, which requires more effort and money to replace, said Bob Gordon, realtor and blogger at Boulder Real Estate News. "Many buyers like to upgrade the floors in their homes," he said. "Adding tile or wood can make an improvement in value -- unless you get that person who wants the 1950s diner look and installs black-and-white tile. For their vision, this is the pinnacle of cool. But for a resale value, most homebuyers will see it as a distraction and something they will need to rip out."
To continue reading, please go to the original article here:
https://www.gobankingrates.com/investing/real-estate/home-renovations-hurt-homes-value/
Top 10 Rules for Money
.Top 10 Rules for Money
July 7, 2021 8:30am by Barry Ritholtz
Ten Simple Money Rules for Investing Success
Bad decisions and poor behavior are the primary reasons why many fail to meet their financial goals.
Creating lists1 is a useful way to organize your thoughts: I have created lists of rules for Investing, Valuation, Stock tips, Goldbuggery, even useless financial phrases to avoid. I find these exercises to be valuable ways to figure out what I think. Thinking about money – saving it, spending it, and most of all, how to invest it – is something I have spent decades doing. This has led to recognizing several fundamental truths about capital.
Naturally, I have organized these rules into a list:
Top 10 Rules for Money
July 7, 2021 8:30am by Barry Ritholtz
Ten Simple Money Rules for Investing Success
Bad decisions and poor behavior are the primary reasons why many fail to meet their financial goals.
Creating lists1 is a useful way to organize your thoughts: I have created lists of rules for Investing, Valuation, Stock tips, Goldbuggery, even useless financial phrases to avoid. I find these exercises to be valuable ways to figure out what I think. Thinking about money – saving it, spending it, and most of all, how to invest it – is something I have spent decades doing. This has led to recognizing several fundamental truths about capital.
Naturally, I have organized these rules into a list:
My Top 10 Rules for Money
1. Investing Is Both Simple and Hard: The basic premise behind successful investing is easily understood: “Invest for the long term, be diversified, watch your costs, and let compounding work its magic.”
But following through can be challenging. Humans are plagued by an inability to just “sit there and do nothing.” Failing to do nothing leads to costly errors and loss of capital that erode returns. Understanding what is required is very different than being able to perform, regardless of circumstances, for decades on end.
This leads us to:
2. Behavior Is Everything: The inability to manage emotions and behavior is the financial undoing of many. To paraphrase William Bernstein, “the extent you succeed in finance is based on your ability to suppress your limbic system. If you can’t do that, you’re going to die poor.”
Even the greatest stock pickers will underperform if unable to control their emotional impulses. Allowing those emotional hot buttons to get pressed is how people go wrong in investing. There are no shortcuts, secrets or get rich quick schemes that work, except for my 3-day workshop where I reveal the secrets of the ultra-rich for the low, low price of $4,995. Sign up here.
3. Moderation In All Things: Think of the majority of the assets in your portfolio -– hopefully a diversified, global mix of passive index funds — as the basic meat and potatoes of investing. You can add seasonings, herbs, and vegetables to spice it up and add some flavor.
To continue reading, please go to the original article here:
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