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>having a monthly car payment in perpetuity is considered acceptable. I think that really depends on what part of America. At least where I grew up around a bu

>having a monthly car payment in perpetuity is considered acceptable. I think that really depends on what part of America. At least where I grew up around a bunch of middle class conservatives listening to eg Dave Ramsey (who has other problems IMO) most people think of you as reckless/irresponsible for doing that sort of thing.

aprilthird2021 1y ago
I grew up around a bunch of middle class conservatives in the Southern USA and almost all of them were into debt on house, car, often even taking loans to pay for kids private school. And you'd never know until the family divorced and their lifestyle drastically decreases. Dave Ramsey has to be relatively new because debt was extremely extremely common among conservatives in the US (no idea about liberals didn't live among them)
- SJC_Hacker 1y ago
  Houses are debt, but are generally and appreciating asset Cars are a depreciating asset. It usually does not make sense to go into debt to get one
  - whycome 1y ago
    It’s interesting how the language allows a weird cognitive out. It’s not debt, it’s a mortgage and they ‘own’ the home.
    - milesrout 1y ago
      Nobody said it isn't debt. The difference is that it is debt that makes sense: you can't realistically buy land without it, and houses tend to appreciate so the interest costs are less of a problem - they just represent the time value of money. Most other debts people incur personally are to buy things they could save for, which go down in value. Like cars.
      - whycome 1y ago
        That’s the out. I’ve seen many people explain what their debts are and don’t think of their mortgage as one.
    - tim333 1y ago
      It's not a weird cognitive out, there are major differences, legal and financial between say credit card debt and a mortgage on a house.
  - darth_avocado 1y ago
    Cars are a necessity in pretty much most of the country. Even in areas with good public transit, people who are most likely to go into debt to buy a car are also more likely to live further away from public transit and commute for work. Outside of New York, I can’t think of another city where living without a car is really an option.
    - SoftTalker 1y ago
      Chicago. Probably a few other big cities.
      - wombatpm 1y ago
        Yes, but you have to live in the City. The suburbs are impossible without a car.
        SoftTalker 1y ago
        Well, around Chicago some of the smaller suburbs have a nice little downtown and are on a train line into the city. If you lived near that you might get by just using online shopping and uber if you occasionally needed to go somewhere. There is bus service too but it's not that good. But in general, and in the larger suburbs yes you would be pretty inconvenienced without a car. But that is true of suburbs everywhere.
        tptacek 1y ago
        You'd be fine in basically all of the inner-ring suburbs except maybe on the south side.
    - tacticalturtle 1y ago
      Boston. DC. Chicago. I’ve heard Philly and SF as well, but have never been.
      - darth_avocado 1y ago
  - nradov 1y ago
    Houses are a depreciating asset. They require constant maintenance expenses just to hold their value. It's the land under the house that's the appreciating asset.
    - afavour 1y ago
      Is there really a meaningful difference when you’re not able to buy one without buying the other?
      - jackvalentine 1y ago
        Maybe - we’re trying to sell a deceased family member’s block of land that might be worth more in the market if we demoed the building because it’s unliveable.
    - deleted 1y ago
      [deleted]
    - amluto 1y ago
      Sort of. In a lot of areas, the cost of the house has skyrocketed in the last few decades. One factor is that you can’t buy an empty lot and then build a 20 year old $250k house on it in most markets. If you want to build a house, that house will be new (obviously — relocating an old house is a real pain), and the costs of construction are silly. This effect inflates the value of old houses in a lot of markets. Of course, in markets that don’t have plenty of inventory of both empty lots and lots with old houses, it can be hard to value the house by itself.
      - LoganDark 1y ago
        > relocating an old house is a real pain Has relocating an old house even been done? (Assuming the house wasn't built to be movable.)
        jwagenet 1y ago
        Somewhat recently in SF. https://www.theguardian.com/us-news/2021/feb/23/san-francisco-victorian-house-moved https://www.theguardian.com/us-news/2021/feb/23/san-francisc...
- msgodel 1y ago
  A good portion of them did get a mortgage. To my knowledge none of them have car payments, most drive used beaters like I do.
- wat10000 1y ago
  Ramsey is very niche. People who are good with money will find his advice some combination of obvious and bad. People who are bad with money will tend to either not want his advice, or have a hard time following it. A few people are in a sweet spot where they’ll actually follow it.
philwelch 1y ago
Dave Ramsey is perfect for the type of people who need Dave Ramsey. If you’re a standard deviation or two above the median person in terms of having your shit together and being smart about personal finance you can do a few things more optimally than he would recommend, but the advice that works for that person could easily ruin most people.
- threemux 1y ago
  I was always confused why he was popular until someone told me to think of Dave Ramsey like vaping. It's great if you're currently a 2 pack a day cigarette smoker, but bad if you don't currently smoke. That cleared it up for me.
- Gareth321 1y ago
  Agreed. For example, he strongly advises paying off one's house first. While this is good advice for many/most who struggle to save and invest, it's not optimal for maximising returns on a given portfolio. If the interest rate is below expected investment returns (minus tax and other subsidies, discounted for volatility), it can often be optimal to invest rather than pay down mortgage debt. It also means more liquidity in the case of sickness and redundancy. Equity in one's home can be difficult to access without some hefty fees or interest rates.
baby_souffle 1y ago
> I think that really depends on what part of America. And the age of the cohort... Millennials (1980 to '95-ish) have had student loans since as far back as they can remember. What's _another_ never-ending monthly payment?
- philwelch 1y ago
  My wife and I are millennials and we paid off our student loans within a couple years once I started my career. I don’t even remember if it was before or after we got married and we’ve been married for over a decade now. Maybe we’re fortunate but I can’t imagine still having a monthly student loan payment. Of course I also absolutely hated being in debt and having a monthly payment to begin with so I made it a priority to solve that problem asap. Likewise, I have always paid cash for every car I’ve bought. My only never-ending monthly payment is my mortgage and the alternative to that is paying rent which I like even less. Fundamentally it’s a mindset thing. I also don’t buy taxi rides for my Chipotle orders.
  - climb_stealth 1y ago
    I have a very similar mindset, but, man, mortgages hurt. At least when paying rent the money goes towards a real person. With a mortgage such a big chunk of the payment is the interest that just goes to this faceless entity that is the bank. How does it not bother you? :)
    - philwelch 1y ago
      Most of my landlords were faceless entities too. Obviously I’d rather the house be paid off but I didn’t have $300,000 in cash and I have to live somewhere.
      - climb_stealth 1y ago
        Yep okay, fair enough!
- msgodel 1y ago

aprilthird2021 1y ago

I grew up around a bunch of middle class conservatives in the Southern USA and almost all of them were into debt on house, car, often even taking loans to pay for kids private school. And you'd never know until the family divorced and their lifestyle drastically decreases. Dave Ramsey has to be relatively new because debt was extremely extremely common among conservatives in the US (no idea about liberals didn't live among them)

SJC_Hacker 1y ago
Houses are debt, but are generally and appreciating asset Cars are a depreciating asset. It usually does not make sense to go into debt to get one
- whycome 1y ago
  It’s interesting how the language allows a weird cognitive out. It’s not debt, it’s a mortgage and they ‘own’ the home.
  - milesrout 1y ago
    Nobody said it isn't debt. The difference is that it is debt that makes sense: you can't realistically buy land without it, and houses tend to appreciate so the interest costs are less of a problem - they just represent the time value of money. Most other debts people incur personally are to buy things they could save for, which go down in value. Like cars.
    - whycome 1y ago
      That’s the out. I’ve seen many people explain what their debts are and don’t think of their mortgage as one.
  - tim333 1y ago
    It's not a weird cognitive out, there are major differences, legal and financial between say credit card debt and a mortgage on a house.
- darth_avocado 1y ago
  Cars are a necessity in pretty much most of the country. Even in areas with good public transit, people who are most likely to go into debt to buy a car are also more likely to live further away from public transit and commute for work. Outside of New York, I can’t think of another city where living without a car is really an option.
  - SoftTalker 1y ago
    Chicago. Probably a few other big cities.
    - wombatpm 1y ago
      Yes, but you have to live in the City. The suburbs are impossible without a car.
      - SoftTalker 1y ago
        Well, around Chicago some of the smaller suburbs have a nice little downtown and are on a train line into the city. If you lived near that you might get by just using online shopping and uber if you occasionally needed to go somewhere. There is bus service too but it's not that good. But in general, and in the larger suburbs yes you would be pretty inconvenienced without a car. But that is true of suburbs everywhere.
        tptacek 1y ago
        You'd be fine in basically all of the inner-ring suburbs except maybe on the south side.
  - tacticalturtle 1y ago
    Boston. DC. Chicago. I’ve heard Philly and SF as well, but have never been.
    - darth_avocado 1y ago
- nradov 1y ago
  Houses are a depreciating asset. They require constant maintenance expenses just to hold their value. It's the land under the house that's the appreciating asset.
  - afavour 1y ago
    Is there really a meaningful difference when you’re not able to buy one without buying the other?
    - jackvalentine 1y ago
      Maybe - we’re trying to sell a deceased family member’s block of land that might be worth more in the market if we demoed the building because it’s unliveable.
  - deleted 1y ago
    [deleted]
  - amluto 1y ago
    Sort of. In a lot of areas, the cost of the house has skyrocketed in the last few decades. One factor is that you can’t buy an empty lot and then build a 20 year old $250k house on it in most markets. If you want to build a house, that house will be new (obviously — relocating an old house is a real pain), and the costs of construction are silly. This effect inflates the value of old houses in a lot of markets. Of course, in markets that don’t have plenty of inventory of both empty lots and lots with old houses, it can be hard to value the house by itself.
    - LoganDark 1y ago
      > relocating an old house is a real pain Has relocating an old house even been done? (Assuming the house wasn't built to be movable.)
      - jwagenet 1y ago
        Somewhat recently in SF. https://www.theguardian.com/us-news/2021/feb/23/san-francisco-victorian-house-moved https://www.theguardian.com/us-news/2021/feb/23/san-francisc...
msgodel 1y ago
A good portion of them did get a mortgage. To my knowledge none of them have car payments, most drive used beaters like I do.
wat10000 1y ago
Ramsey is very niche. People who are good with money will find his advice some combination of obvious and bad. People who are bad with money will tend to either not want his advice, or have a hard time following it. A few people are in a sweet spot where they’ll actually follow it.

philwelch 1y ago

Dave Ramsey is perfect for the type of people who need Dave Ramsey. If you’re a standard deviation or two above the median person in terms of having your shit together and being smart about personal finance you can do a few things more optimally than he would recommend, but the advice that works for that person could easily ruin most people.

threemux 1y ago
I was always confused why he was popular until someone told me to think of Dave Ramsey like vaping. It's great if you're currently a 2 pack a day cigarette smoker, but bad if you don't currently smoke. That cleared it up for me.
Gareth321 1y ago
Agreed. For example, he strongly advises paying off one's house first. While this is good advice for many/most who struggle to save and invest, it's not optimal for maximising returns on a given portfolio. If the interest rate is below expected investment returns (minus tax and other subsidies, discounted for volatility), it can often be optimal to invest rather than pay down mortgage debt. It also means more liquidity in the case of sickness and redundancy. Equity in one's home can be difficult to access without some hefty fees or interest rates.

baby_souffle 1y ago

> I think that really depends on what part of America. And the age of the cohort... Millennials (1980 to '95-ish) have had student loans since as far back as they can remember. What's _another_ never-ending monthly payment?

philwelch 1y ago
My wife and I are millennials and we paid off our student loans within a couple years once I started my career. I don’t even remember if it was before or after we got married and we’ve been married for over a decade now. Maybe we’re fortunate but I can’t imagine still having a monthly student loan payment. Of course I also absolutely hated being in debt and having a monthly payment to begin with so I made it a priority to solve that problem asap. Likewise, I have always paid cash for every car I’ve bought. My only never-ending monthly payment is my mortgage and the alternative to that is paying rent which I like even less. Fundamentally it’s a mindset thing. I also don’t buy taxi rides for my Chipotle orders.
- climb_stealth 1y ago
  I have a very similar mindset, but, man, mortgages hurt. At least when paying rent the money goes towards a real person. With a mortgage such a big chunk of the payment is the interest that just goes to this faceless entity that is the bank. How does it not bother you? :)
  - philwelch 1y ago
    Most of my landlords were faceless entities too. Obviously I’d rather the house be paid off but I didn’t have $300,000 in cash and I have to live somewhere.
    - climb_stealth 1y ago
      Yep okay, fair enough!
msgodel 1y ago