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The car loan seems like a bad idea. If the student loan is low-interest, it probably makes sense to invest your extra money and only pay the minimum on the loa
by xsmasher 11y ago
The car loan seems like a bad idea.
If the student loan is low-interest, it probably makes sense to invest your extra money and only pay the minimum on the loan. It's cheap money.
The mortgage may be cheap money too, and can pay off depending on how long they stay in one area. You still need to pay for housing no matter what, and the interest is tax deductible. (This is not an excuse for buying the biggest house you can afford; I mean a lateral move from renting to owning.)
- blisterpeanuts 11y agoThe mortgage interest is not tax deductible in Canada. Also, taxes are much higher in Canada than in the U.S. I'm a bit skeptical about this article. I think the bottom line is that he had a bunch of stocks and mutual funds that he's been accumulating since he was a teen. Most people lack the foresight and advice to do such a thing (God, I wish I'd done it) so this article doesn't really apply to the majority.
- k__ 11y agoI see. It just shocks me to see how people who make good money still get deep into dept. Well, maybe it's just that I came from a poor family, where taking any credits was only done by people who are bad with money. I had a student loan of 4000€ and all I wanted to do was pay it as fast as possible.
- xsmasher 11y agoMany people use credit to buy MORE than they need, and MORE than they can afford. A new car instead of a gently-used car, a larger house that just becomes a sink for their income. That doesn't mean credit is bad - it can be used as a leverage to do more with less - but people with money problems tend to use both cash and credit badly. If it was 25k in credit card bills from vacations meals out plus a 5k jetski loan, I'd be tut-tutting too.