[trader220]

Originally Posted by Vintage Racer

I'd say dump the loans and be mortgage free.

If 2008 didn't show but one thing, it is that debt can bury you. I much prefer to loan money to other people than to be the guy paying interest. A guy with no debt can take more risk in the financial markets than a guy that owes money on a jumbo loan.

I paid cash for my house 22 years ago. I loan 40% of my money to American taxpayers (short term U.S. Treasuries and U.S. TIP bonds) and have the remaining 60% of the portfolio in blue chip (i.g., good balance sheet) dividend paying stocks.

There will be a day soon when I'll take more risk. In the meantime, I refuse to try to catch a falling knife, and I do not plan to be the pig that gets slaughtered.

Most people don’t have the cash laying around to pay for the house, in fact very very few do so that’s moot point. As far as 60% in blue chips, well blue chips got smoked in 2008. I would say that if you can get cheap money in fixed mortgage you’re better off taking the money now and working to beat the fixed rate you’re paying over time and its like not paying interest at all.

Dividends are nice except when the stocks fall by a much greater amount then the div paid.


Credit and debt are not bad things, it depends on what kind and how you use it.