Conoravirus ...

[Benno von Humpback]

Dang. Even my Naval Strength rum is only 114 proof.

It'll sweeten the hell out of your navel, though.

[H B]

I am pretty relaxed about masks outdoors, but I'm not going to restaurants or yacht clubs for dinner.

This is how I am. We are racing without masks, but I am not hugging my sailing friends and I am trying not to talk directly into anyone's face on the boat and stuff. All of the crew on the boat, are kind of in our "social bubble". We are all 40's-50's and healthy, but some of them do have very high risk family members, but I expect they are not visiting them. My old (83), but otherwise healthy father went thru town already in May, so he is in the Finger Lakes until September. My stepfather and I chat 6 feet apart too cuz he is 81.

A personal note, I don't miss the sailboat racing so much that I would wear a mask if dynamics changed. I'd just bow out and go spend more time on my own boat...or finish my bathroom or something.

[TheOffice]

Shawn, I don't miss racing either! I was thinking this would be my last season unless something changed.

I seem to be the Black Widow of vacations. Bermuda, Greece, not CA is tightening back up. We are contemplating shortening our trip to northern California to eliminate San Fran and possibly Monterey, or cancelling altogether and sailing around the Bay.

[Tim Ford]

Hay-sus Maria, Joel....tell me about it. Our plan was East Normandy (again), Piedmont CA and then NH/Maine in August. Now it looks like we are going nowhere rather quickly.

Frankly, I'm just glad to have a boat, and a work space/outbuilding in our backyard. I pity anyone who has an apartment in a crowded urban setting without an escape valve....like 40% of the non-caucasian residents of Baltimore since the late 50s....no wonder Baltimore has such a high homicide rate.

It's a bit of a wonder it isn't higher....

[Benno von Humpback]

I am pretty relaxed about masks outdoors, but I'm not going to restaurants or yacht clubs for dinner.

This is how I am. We are racing without masks, but I am not hugging my sailing friends and I am trying not to talk directly into anyone's face on the boat and stuff. All of the crew on the boat, are kind of in our "social bubble". We are all 40's-50's and healthy, but some of them do have very high risk family members, but I expect they are not visiting them. My old (83), but otherwise healthy father went thru town already in May, so he is in the Finger Lakes until September. My stepfather and I chat 6 feet apart too cuz he is 81.

A personal note, I don't miss the sailboat racing so much that I would wear a mask if dynamics changed. I'd just bow out and go spend more time on my own boat...or finish my bathroom or something.

Right. I wouldn't enjoy it either if I had to worry about masks and getting sick. The guy in the next slip has 6 or 7 random crew and they all drink beer in the cockpit after races and practices. I don't think I'd do that. However, I am doing group rides with limited numbers of middle-aged rich guys whom I don't know all that well. I keep telling myself the risk of that is low...

[H B]

Hay-sus Maria, Joel....tell me about it. Our plan was East Normandy (again), Piedmont CA and then NH/Maine in August. Now it looks like we are going nowhere rather quickly.

Frankly, I'm just glad to have a boat, and a work space/outbuilding in our backyard. I pity anyone who has an apartment in a crowded urban setting without an escape valve....like 40% of the non-caucasian residents of Baltimore since the late 50s....no wonder Baltimore has such a high homicide rate.

It's a bit of a wonder it isn't higher....

No kidding. We just moved my daughter from this cute tudor house in Catonsville, to a row house in Parkville. I could barely stand being in an area like that long enough to help her. I didn't really like Catonsville either, but her area was cute, as long as you didn't stand in the road for fear of getting run over. I cannot for the life of me understand how anyone would choose to live in a crowded urban setting at all. They have to walk past 6 or 7 houses, around the end, and back again to get to the back door! And she even has grass in the front yard. Being REALLY in the city, or any city, would be no bueno..

I am sure with the existing data it could probably be done, and maybe if I just looked at the maps a little closer I could figure it out, but rate of infection as compared to population density/urban vs. rural, etc. might be interesting numbers to compare.

[TheOffice]

I am sure with the existing data it could probably be done, and maybe if I just looked at the maps a little closer I could figure it out, but rate of infection as compared to population density/urban vs. rural, etc. might be interesting numbers to compare.

I bet you would have to factor in income and age as well. Younger and well-off and poor of any age are driving the numbers.

[H B]

I am sure with the existing data it could probably be done, and maybe if I just looked at the maps a little closer I could figure it out, but rate of infection as compared to population density/urban vs. rural, etc. might be interesting numbers to compare.

I bet you would have to factor in income and age as well. Younger and well-off and poor of any age are driving the numbers.

True..it does seem that some newer trends are the younger folks not caring and spreading it to each other in large social gatherings. The rich are getting richer cuz they aren't blowing their cash in public. Hell, I had an extra digit appear in my checking account over the last couple months, just because we have not been out spending money on 'entertainment'.

I must be getting bored if I am starting to think about COVID-19 statistics. Oh wait. I took a picture of my dogbone/slab reefing setup yesterday..let me go find that thread!!

[Ajax]

Not eating out has saved us large amounts of money. Ranger M's "retail therapy" has also been severely curtailed.

I'm hoarding cash as rapidly as possible because I'm telling you- government spending cutbacks are coming. Very few will be spared.

[Steele]

We are also saving money not eating out, I have not been to starbucks in weeks. We are also selling lots of stuff on craigslist as a side effect of using stuck at home time to clean out the house. Two elaborate vactions have been canceled. I would trade all that for a pre covid life, but at least I have more cash to spend on the boat.

[Ajax]

Craigslist is full of nuts. I applaud your bravery.

We did most of the cleaning out and divesting of excess stuff early in the pandemic. We donated most of it to Goodwill and will take the charitable donation deduction.

I just checked lending rates. I might be able to refinance the house down to a 15 year note for only a slightly higher monthly payment. It would knock almost 9 years off my note. The house would be paid for a year or 2 after my intended retirement date. This is a side effect of COVID.

[kimbottles]

Craigslist is full of nuts. I applaud your bravery.

We did most of the cleaning out and divesting of excess stuff early in the pandemic. We donated most of it to Goodwill and will take the charitable donation deduction.

I just checked lending rates. I might be able to refinance the house down to a 15 year note for only a slightly higher monthly payment. It would knock almost 9 years off my note. The house would be paid for a year or 2 after my intended retirement date. This is a side effect of COVID.

Years ago we did just that Rich, we refinanced our home down to a 15 year loan. Got the house paid off and saved a bunch of interest. I highly recommend this course of action. We love having no debt.

[Ajax]

Well, I just used the (very dumb) calculator on my lender's website. I'll need to talk to an actual human and have them run the numbers to see if I can really get the interest rate indicated by the calculator.

[TheOffice]

Rich,

We are going with a 20 year loan and will make extra payments to shorten it.

We've been using Facebook Marketplace to sell stuff. We are in the middle of a kitchen remodel. Sold all the appliances in less than 24 hours. Lots of lowball offers, but no scammers (yet).

[LarryHoward]

Well, I just used the (very dumb) calculator on my lender's website. I'll need to talk to an actual human and have them run the numbers to see if I can really get the interest rate indicated by the calculator.

http://bretwhissel.net/amortization/amortize.html

Just have to add in escrow amounts to come up with actual payment as this only shows P&I. Can print out the amortization table if you want.

[Ajax]

Well, I just used the (very dumb) calculator on my lender's website. I'll need to talk to an actual human and have them run the numbers to see if I can really get the interest rate indicated by the calculator.

http://bretwhissel.net/amortization/amortize.html

Just have to add in escrow amounts to come up with actual payment as this only shows P&I. Can print out the amortization table if you want.

The Bretwhissel calculator jives with my lender's calculator within a few bucks. That's encouraging.

[Benno von Humpback]

We recently looked into it, but Janell had paid so much extra principle on our 30 yr mortgage since 2012 that it wasn't worth the overhead to refi the balance.

[kdh]

I paid off my mortgage but unfortunately the tax bill doesn't go away.

[Jamie]

I just wish we could fit inside the new federal local tax exemption limits.

[Slick470]

We are also looking into a refi. We've always tried to pay ahead on our loan, but with the tax incentive gone it makes more sense to pay the loan off sooner.

[LarryHoward]

We are also looking into a refi. We've always tried to pay ahead on our loan, but with the tax incentive gone it makes more sense to pay the loan off sooner.

We paid ours off a couple of months ago. With the new SALT limits and increased standard deduction, we hit standard deductions territory this year and decided with a very nervous market, we should just eliminate the mortgage debt. Bank account took a hit but monthly expenses dropped a lot. Of course, we are in a different place in life than many of you and no debt as we approach retirement is a good thing.

[Slick470]

We are also looking into a refi. We've always tried to pay ahead on our loan, but with the tax incentive gone it makes more sense to pay the loan off sooner.

We paid ours off a couple of months ago. With the new SALT limits and increased standard deduction, we hit standard deductions territory this year and decided with a very nervous market, we should just eliminate the mortgage debt. Bank account took a hit but monthly expenses dropped a lot. Of course, we are in a different place in life than many of you and no debt as we approach retirement is a good thing.

The no debt for retirement is where we want to be as well. Right now, we only have the mortgage and we're pretty happy that is all we have.

[Panope]

I went 100% dept free about 12 years ago (I was 39). Although it may not have saved much money (the interest was very low), the mental satisfaction has been priceless.

[slap]

Paid the mortgage off two months after I retired.

[SemiSalt]

After the last payment on our 30-year mortgage, we took out a homeowner loan to do some overdue maintenance. A few years later some cash became available, and we paid off the loan because the loan rate was so much higher than what the money could earn.

A thing about mortgages; you don't much miss them when they're gone.

[Olaf Hart]

We built our first home and paid cash, never needed a loan since apart from one short term one while we waited for an old house to sell.

I agree with Steve, it’s worth it just for the peace of mind...

[BeauV]

I may be odd. (Well some would say I am definitely odd) But, I have a very mercenary attitude about debt. By that I mean that if it is used as a financial tool, debt can be a great way to increase returns on your assets and income, I believe it is correctly called "leverage". However, if you can't delever when needed debt can be a pair of concrete overshoes while you're trying to tread water. Here's an example of how I've used debt over the course of many years.

When the inflation rate was higher than the interest rate, and there was an unlimited mortgage interest deduction, I levered up as far as I could. Put another way: The after-tax income from the money I had borrowed was more than I was paying in interest. When the inflation rate dropped below the interest rate, I started to de-lever. The point being that borrowing money was a financial calculation which you could adjust frequently as conditions change.

This strategy requires liquidity to be successful. By that, I mean that if the market moves against you (EG: inflation drops off, variable interest rates go up, mortgage interest deductions are reduced or eliminated), then you have to have the ability to pay off the debt without catastrophy. Sadly, many people don't look at debt this way. Simply put, they borrow too much to allow them to de-leverage when the market factors move against them.

Simply put, debt is a great way of having a low-risk tool to increase your income, but only if you have the cash to pay it off when things move against you.

I had a very tough conversation with my first wife when I told her we needed to sell the big house we'd bought and buy one which was far more modest because market conditions had changed. Somehow "homes" are not viewed as assets to be randomly bought and sold for purely mercenary reasons by some spouses. It didn't do our marriage any good. But, despite the marital discord, but using the mortgage interest deduction as a tax shelter when ordinary income was large allowed us to realize a larger after-tax income by owning a house that was absurdly large and expensive. I was happy to sell the thing and de-level. She was crushed as she believed we'd live there forever, despite an series of discussions in which I'd made the mercenary purpose of the house clear. (Those were forgotten.)

In my second marriage, I have learned my lesson and only put money into houses whose primary purpose was NOT to utilize leverage. That said, our current home carries a hefty mortgage, the after-tax returns on those borrowed funds in the stock market have been over twice the cost of borrowing the money. The key point. Plus, there is enough liquidity to pay off the mortgage if we're ever upside down. Even now, (with the exception of the April, May, and the first half of June) the net income after tax from the funds has been better than the interest rate. We're now talking about refinancing the house at a lower interest rate, not to pull cash out but to lower our cost of fund.

I know this sounds like a lot of bothers, but it has provided a reasonable chunk of income to us and I find it fun to do the math and execute the strategy.

[Olaf Hart]

Well, since we entered the housing market here in Oz in the late seventies to now, there has never been a tax deduction for your principal place of residence, and I can’t recall a time when interest rates were significantly lower than average stock returns.

But capital gains on your principal place of residence are also not taxed, so we have developed an unhealthy boom in housing costs, especially in desirable areas.

So we have benefited financially from our strategy, and would have made less if we had to cover interest costs.

[BeauV]

OH

The S&P 500 stock index in the US has gone up about 300% over the last 10 years. The interest rate on our mortgage is 3.1%. The interest on up to a $1,100,000 mortgage is deductible from income, effectively that much income is not taxed. Inflation has been low, about 2%. So even if one’s house doesn’t appreciate at all, the after tax win is massive. The appreciation of houses in the US has been about 4.5% per year across the last 10 years. (There are wide local variations in these numbers)

[Olaf Hart]

The last house we sold in Sydney made nearly 500% on the purchase price, over 20 years.

It helps to be able to renovate, and there is an infinite demand for waterfront property on Sydney Harbour..

But our housing market is sick, it soaks up a lot of capital that should go into investment, it doesn’t go down, and now we are offering visas to British citizens in Hong Kong it’s not going to be any cheaper.