What terrible financial decisions have you witnessed your family, friends, or coworkers make?

[Turn the Page]

In my area starter homes are just so pricey to begin with. Of course there's really really nice homes but don't equate price with type of home, especially in strong seller's markets.

Our rental house we had in 2013-2014 was built in 2006 but was a starter home. 1,500 sq feet 2 bed 2 bath with a 3rd room not considered a bedroom (doesn't have a closet). When we rented it the area was in a buyer's market and the owners had actually taken it off the market after trying to sell it for $160,000 (and really that was because the area it was in was a nice area) in between tenants.

in 2015 our area became a seller's market and has stayed that way. It sold in 2018 for $215,000. The appraised value from the county for 2021 is $242,400. If only looking at today Zillow Zestimate is $273,943.

There is def. overextending yourself but I think people need to also get away from thinking you have to do a starter home just because that's what someone has said you have to do. It has much more to do with finances than a perceived moving up you must accomplish.

At this moment we have low interest rates but too competitive of a market so only those well off in finances can get into homeownership and others are blocked, even from the starter homes.

We live in a rural resort/vacation destination and people seem to be leaving the cities and moving to this area as a result of the pandemic. A lot of people with second homes here are spending more time here than they normally would but a lot of people are simply moving here. It sounds good at first but I bet we see a mass exodus back down state after the first hard winter.

Anyway, that has sent prices through the roof. I can't imagine trying to buy a "starter home" here now.

 

[Starport Seven-Five]

I see their point of the younger generation not wanting to start out with "starter homes". They want it all and they want it now!

As someone who watched a lot of people my age get "stuck" in their starter homes due to the 2008/9 recession, I really dislike the idea of buying a home knowing it won't fit your needs in a few years. The market goes up and down so people need to be prepared for it.

We live in a rural resort/vacation destination and people seem to be leaving the cities and moving to this area as a result of the pandemic. A lot of people with second homes here are spending more time here than they normally would but a lot of people are simply moving here. It sounds good at first but I bet we see a mass exodus back down state after the first hard winter.

Anyway, that has sent prices through the roof. I can't imagine trying to buy a "starter home" here now.

It'll be more based on how companies react to remote work. A lot of people have taken advantage of suddenly being remote to live where they want to instead of where they have to. There has definitely been a shift within most companies but it remains to be seen how much of that is permanent.

 

[rigs32]

I'm in my 40s and as my friends and I hit our stride in our careers and are now many decent money, I see a lot of people falling into the trap of keeping with with the lifestyle of others. People with kids are upgrading their homes and making themselves house poor. Those same people whine about my ability to travel, but I don't have kids and last year I paid off my small townhouse. Yes, I know that I probably could have made more in the market, but I wanted that asset and housing stability. What would have been my mortgage payment now goes to my financial planner. I'm by no means wealthy, I just wanted to make sure I was secure.

I work for the government. The benefits are amazing. After a certain amount of time, the salary is quite comfortable for my area. A lot of people leave when they get to a point of wanting a big suburban house for the kids and cash to pay for all the extras. But i've done the math. I would have to double my salary in order to make up for not maximizing my pension before leaving, not to mention good health care coverage, all holidays, and five weeks of vacation a year. Very few American companies provide those sorts of benefits anymore.

I am sometime envious of the homes my friends have but..... I can still visit them at their homes and enjoy the amenities without having to pay for or maintain them. I expect to return the favor when they visit me in retirement as I already have a plan for where I'm going to live and in what type of house. I'll also be able to retire with a full pension at 57. If health care is still an issue then, I can stay 3 more years and qualify for free health care for life for me and my spouse.

 

[Mackenzie Click-Mickelson]

It'll be more based on how companies react to remote work. A lot of people have taken advantage of suddenly being remote to live where they want to instead of where they have to. There has definitely been a shift within most companies but it remains to be seen how much of that is permanent.

For my husband's company they already asked who wanted to work from home permanently. And companies have taken the opportunity to downsize how many people they have in the office as it lowers their office costs (especially if they don't have to be spread out in several buildings or have a big building to accommodate all the staff). I would say it's more that some employees will just remain remote not necessarily that the majority of a company will like you had with the pandemic. But companies were forced to go remote and in spite of prior reservations they may have had about it some companies have embraced the idea of it. Remote working can do wonders for office space, costs, potentially how many illnesses pass (depending on how many people are still in the office), inclement weather concerns, etc.

 

[china mom]

Sadly, this is the hitch in everyone's retirement plan IF you want to retire before 65. The unpredictable nature of HC costs makes it difficult to plan and heaven forbid if you become ill and need care.

Yep, retired at age 46 with a six year old and an eight year old at home. Family insurance was costing us $1200 a month (was allowed to stay on my previous employer's plan but had to pay full premium). Had to go back to work for the healthcare coverage. Nine more years to go before Medicare

 

[1GoldenSun]

Guess she is planning on our mother’s money when mom dies as her “retirement plan”...

I know someone like this. They'll probably come into a lot of money someday and they're just living their life in limbo in the meantime, waiting for that day to come. The relationship with the parents is not good, which explains why they can "look forward" to their parents' death without much grief, but this is also why I'd be concerned that this person could be cut out. This has been discussed and I would not be at all surprised if when the parents finally die my friend discovers that he is not in the will at all; it would be just like his parents to cut him out and not tell him.

He mooches off his parents as much as they'll let him, and works a series of jobs here and there when he needs the money, but they never last long. He's middle-aged and never married or had a family because he couldn't afford it. At least he was responsible enough not to have a passel of kids and expect his parents to support them.

He's basically just treading water, waiting for his parents to die so his real life can begin, and it's sad.

I blame his parents in part, for many reasons. My husband and I will likely be leaving our children a significant amount of money, and my husband's father recently died much younger than was expected and left our children quite a but of money, but we're not even letting them become aware of how much money they're probably "worth" at such a young age. I don't think it would be beneficial to them.

 

[Turn the Page]

As someone who watched a lot of people my age get "stuck" in their starter homes due to the 2008/9 recession, I really dislike the idea of buying a home knowing it won't fit your needs in a few years. The market goes up and down so people need to be prepared for it.


It'll be more based on how companies react to remote work. A lot of people have taken advantage of suddenly being remote to live where they want to instead of where they have to. There has definitely been a shift within most companies but it remains to be seen how much of that is permanent.

To the second point, well, sure. The proliferation of remote work made it possible but the pandemic is still a factor.

To your second, I agree. I understand not likely being able to get your dream home the first time out but I never really viewed my home as an investment the way many do. Keep resale value in mind, sure, but i'm not upgrading and moving every few years either. And i'm not stretching my finances to the point that i'm laying awake at night worrying about how i'm going to pay the mortgage either.

 

[RamblingMad]

Yep, retired at age 46 with a six year old and an eight year old at home. Family insurance was costing us $1200 a month (was allowed to stay on my previous employer's plan but had to pay full premium). Had to go back to work for the healthcare coverage. Nine more years to go before Medicare

This is my challenge. Health insurance. If we had universal healthcare, I could retire. I feel like our laws force us back into the work place or keep us there.

 

[dvcgirl67]

Sadly, this is the hitch in everyone's retirement plan IF you want to retire before 65. The unpredictable nature of HC costs makes it difficult to plan and heaven forbid if you become ill and need care.

Yup, this is a hurdle for sure. We only pay about $250 a month for healthcare now. We were talking about this last night because I mentioned this topic to my husband. He reminded me of two things, for one, COBRA lasts for 18 months, and two...a point I like to forget, I'm 18 months older than he is. So, if he retires at 60, we have 2.5 years of coverage between COBRA and the sabbatical year....and I'll then be 64, so I'd only be one year away from Medicare. It's definitely something to prepare for....regarding higher premiums for a couple of years, possibly taking our emergency fund up another 30-40 grand to have a cushion, but I think it's doable for our one to two and a half year window that we'd need coverage.

 

[Colleen27]

Sadly, this is the hitch in everyone's retirement plan IF you want to retire before 65. The unpredictable nature of HC costs makes it difficult to plan and heaven forbid if you become ill and need care.

Yep. I'd really like to be able to plan for DH & I to retire together, but we're too far apart in age for me to have any confidence in our ability to make that work. Right now he carries our benefits and I'm a "gig worker", but he's 9 years older than me. So if he retires at 65, we're going to have to figure out health insurance for that gap. Ideally, we'd get an ACA plan for me to cover those years and I'd continue on with a flexible work situation but it is hard to feel confident spending that kind of money so early in retirement without knowing what the future might bring. More likely, I'll be heading into a rigid full-time work situation just as he's retiring and we won't really get to enjoy retirement together (he's a smoker and not from a long-lived family, so I'm not optimistic about him still being healthy and active when I reach medicare age).