Will the monthly payment be the death of us?

[Rambler]

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Originally Posted by ziggy29 If you almost never use it, with T-Mobile you can get prepaid cellular for $10 per year after an initial $100 investment in loading the phone with prepaid minutes. Just sayin'.

It is T-mobile. That is the one we keep for use when we are back in the US. I thought we had to put $100 on it per year to keep it for the next year...I'll have to check on that next time we are there. Thanks Ziggy.

R

[packrat44]

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Originally Posted by Art G From my perspective, the "monthly payment" will bring down the economy. Think about it.... cable bill internet bill satellite radio cell phone bill day care car lease credit card interest ?

When I first read your post I thought you were being facetious. Now I not so sure. When did those items become "needs"?

[Gumby]

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Originally Posted by ladelfina I'd get worried about prop. taxes, too. Even though values (and thus assessments) should be falling.. I've seen people reporting that (for example) some cities have decided to up assessed values of the underlying land to make up for declines in value of the actual bldg.. Many have already gone from a proportional assessment (like 70%) to 100%.. and some are raising the mil rate into the 20s and 30s! Sis in an avg. suburban CT house is paying $8k or so: almost $700 month. Longer-term residents complain their taxes are higher than their mortgage. AND rates are scheduled to increase a further 6.6% this year!!! Even w/o further increases.. over the time she plans to stay in the house, she'll have paid more than half-again its value in Prop. tax.

Property taxes are a source of major angst for most of the retired people I know. The only way to make it stop is to sell the house -- an unsatisfactory solution at best. After retirement, with a paid off mortgage, property tax will be my single biggest monthly expense. It is currently $729 per month, and I have noticed it never goes down.

[Dreamer]

I lived with my aunt and uncle growing up in PA. My aunt was a stay-at-home mom and they rented their houses, at that time. I was thinking of the difference in our bills compared to their bills then. The things that we are paying for that they did not pay for: natural gas (they had free), water (they had a well), trash pickup (they burnt in a barrel), they paid insurance on 1 car (we have 4 vehicles), they did not have property tax or insurance (we have both), daycare (we no longer have) , cable tv, internet, cell phones, blockbuster movie subscription, long term care insurance, prepaid college tuition for children, support a child monthly through World Vision, and I am probably forgetting some other things. I realize that we don't need a lot of the above services and we did not have them when we were making the push to get our home paid for and our retirement savings (we still save for retirement) since my DH is still working. However, if it were just me, I could easily eliminate some of the above services and I would definitely only have 1 vehicle. However, my DH enjoys most of the above and is a car person and we can afford it now, so we endulge ourselves.

[UncleHoney]

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Originally Posted by Art G From my perspective, the "monthly payment" will bring down the economy. Think about it.... cable bill internet bill satellite radio cell phone bill day care car lease credit card interest

In my book all the things on your list are extras and not utilities the way most people consider them today. Right now we don't even have cable TV, but will probably have it soon.

The only thing we currently have is internet service and we use it all the time, it's our form of entertainment for the most part.

The real killer in most of these services is the extras, do you want text messaging with that cell phone, how bout call waiting, or maybe answering service or caller ID?

All the little extras beyond basic services can eat you alive in costs.

A friend of DW's stopped by the house the other day to pick up something. DW told me she and her husband were currently in bankruptcy, a retired couple. When I loaded the stuff in her car I noticed "vanity plates" on her 2005 Mini Cooper and just before she left she called her husband on her cell phone. She was only here for about 10 minutes, but in that time I saw two possible causes for the bankruptcy. I just wonder how many other complications they have in their lives.

[Walt34]

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Originally Posted by Rivrider A lot of folks never really look at their pay stub and think about how much they are actually paying. If we had to write a check every month, and more people actually paid income tax, people might start asking their congressperson "What are you spending my money on?"

I still remember my shock and dismay when I got my first $17.00 paycheck working in a gas station and asking "What is FICA? Why does a high school guy have to pay income taxes?" and so on. After that I just kind of tuned out the gross number and focused on the net because that was the only one that had any meaning.

[Art G]

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Originally Posted by packrat44 When I first read your post I thought you were being facetious. Now I not so sure. When did those items become "needs"?

Where did I say any of those were "needs"? I merely pointed out these were a few of the things that are monthly driving people away from retirement.
BTW, I forgot to add Netflix.

[d]

i know many people who claim these and similar expenses to be needs ... and the lengths they'll go to justify the "necessity" is close to absurd.

[lazygood4nothinbum]

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Originally Posted by Moemg That's interesting ! I thought we could only use our homestead portability once . As soon as the market picks up I going to use mine to buy a house a little further from the water .

hey moemg. a good friend of mine who agrees with me that my plan is crazy must have had his interest peaked because he found the answer for us on portability. of course one of the first things he said was that i'm insane to think of the stock market as a two-year investment. but if my market timing doesn't work, not a big deal; because then i just consider it long-term and kiss florida and my soh value goodbye. however, just in case my timing coincides to both stock & real estate markets (which today will look like: sell fort lauderdale low/buy stocks low/sell stocks high/buy daytona low/etc), who knows, crazy just might work.

anyway, here is the reference i just received from my buddy.

Broward County Property Appraiser's Network

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The "Save Our Homes" (SOH) Amendment in Florida’s Constitution was intended to prevent homeowners from being taxed out of their homes due to rapidly rising real estate values. It met that goal, but caused many other problems along the way. That is why Florida voters adopted a "portability" constitutional amendment in January 2008 to allow eligible homesteaded owners to move savings from one property to the next. Homesteaded owners may now move their Save Our Homes (SOH) benefit -- up to $500,000 -- from one homesteaded property to the next within Florida. To be eligible to move these SOH savings, the new Homestead must be purchased within two years of the abandonment of Homestead at the previously Homesteaded property. Owners of Homesteaded properties sold in 2007 will be eligible to move their SOH savings to a newly purchased property so long as it is Homesteaded by January 1, 2009. Portability applies to both upsizing and downsizing in value, based upon specified formulas. Portability may be used an unlimited amount of times and may be used for moves to anywhere within Florida.

[Own2Feet]

I'm in synch with most everybody on this thread, except I use dial-up Internet (free via the county library) which, apparently, makes me equivalent to a dog in some posters' minds. Well, Arf arf!
I'm more patient than some; when I truly need a fast connection--for example, to upload photos to my Webshots site--I take my (free from a computer-store giveaway, and yes, I had it checked for viruses and other nasties) thumb drive to the library and use one of their computers.
I don't have a cell phone, don't even like TV, have always paid cash for cars (spouse and I share one Ford Focus between us), never carried credit card debt, etc. etc.
We're good cooks, so we never eat out; both always toted our lunch to work. We do pay $10.00 per month for movies from Netflix, and spouse subscribes to several periodicals. The rest of our entertainment comes from that good old library, and from watching nature in our big back yard.
The frugality is habitual, yet it's also seen as necessary for me to be able -- some day -- to stop working (spouse is older and has retired). I make a good income, spouse has a pension, but TAXES--income, property, and sales--eat up nearly half our income. And yes, I do see our society as consisting of ants propping up grasshoppers, and myself and spouse as ants. Wonder if that's fair of me, or if I'm being petty and prideful.

[samclem]

Own2Feet,
Welcome to the board. Drop us a line over at the "Hi, I am. . . " forum and let us know about you (as much as you'd like to share).

I can tell you've been looking over the information here. You'll find all kinds of people here, some who probably spend a lot more than you do, but there are some folks who probably do just fine while spending less.

Again, welcome.

[Bestwifeever]

Wow, Own2Feet--all I would add is that our library carries or can get almost all periodicals--you could cut back a little more by cancelling those subscriptions, you spendthrifts

[old woman]

I spend about 367 a month on Cable, Internet, Cell phone, Water, Sewer, Electric, Gas, Garbage and have a mortgage. Twice a year I pay car insurance and property taxes and once a year house insurance. Cutting cable and internet and cell won't save me much. Getting rid of the mortgage would be a big help but other than that saving on taxes is my main thing I can cut.
Now I put away 20.5K for retirement which cuts my income tax to about 2,500 a year. Nothing I can do about property taxes yet. When I retire I will be low income elderly so my property taxes will be cut to about 10%.

[Hershey102]

Used cars, excuse me, I mean previously owned cars, are advertised now with 96 month loans. If it takes 8 years to pay off a car or truck, maybe . . . just maybe . . . you can't afford it. Unfortunately, the mindset is to look at the affordability of monthly payments, not the actual cost.

[audreyh1]

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Originally Posted by Art G From my perspective, the "monthly payment" will bring down the economy. Think about it.... cable bill internet bill satellite radio cell phone bill day care car lease credit card interest

Not my problem nor do I think it will "bring it down". So my neighbor has debt? That means he/she has to work as long as he/she is able. That's not necessarily a bad thing. Personally, I kind of think the "monthly payment" has been a boost to the economy for a long time....

People take on these things by choice. Then they get to work forever to pay them off. I made different choices. But I'm happy to invest my money in companies catering to all these consuming folks.

Audrey

[FIREd]

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Originally Posted by Art G From my perspective, the "monthly payment" will bring down the economy. Think about it.... cable bill internet bill satellite radio cell phone bill day care car lease credit card interest I'm sure I've forgotten quite a few, but consider it. All these things are small monthly expenses that add up to things we'll never own. We talk about the savings of our parents or grandparents and wonder why they were able to do it on such small incomes? They bought things, paid them off, then needed much less income to survive in retirement. What is going to have to happen to save the economy from a surefire broke economy in our senior years? You may think it won't affect you because you've saved, but we can already see the government's involvement with bailing out people. Is Rome about to burn? Even though you've saved, will you be paying for your neighbors retirement?

I am always on the lookout for opportunities to cut fixed expenses (including monthlies). This year I have worked hard to reduce our phone bill, electric bill, and internet/cable bill. I am also hunting for bank and investment fees (ATM fees, bank download fees, broker fees and commissions, custodial fees, tax preparer fees...). So far we have reduced fixed expenses by almost $2000 this year. One of the biggest scams I think was my landline phone bill. Almost $45 a month just for local calling, full of taxes, fees, features we never used. A real sham!

[JustCurious]

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Originally Posted by Walt34 So, many people apparently just can't distinguish between "wants" and "needs". People in the '30s knew that what they needed was food, clothing and shelter and everything else was "wants".

Walt, I think there are a few more things that qualify as "needs" for those of us who live in modern society... medical care, a quality education, electricity, running water, transportation, and some form of communication.

[JustCurious]

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Originally Posted by FIREdreamer One of the biggest scams I think was my landline phone bill. Almost $45 a month just for local calling, full of taxes, fees, features we never used. A real sham!

I agree. I cancelled my landline service about 2 years ago, and I don't miss it.

[Bimmerbill]

I think thats how a lot of people get into trouble. Just one little monthly payment, then another, then another. Then something happens, and people don't realize how tight money is and the house of cards falls.

[youbet]

Quote:

Originally Posted by Gumby Property taxes are a source of major angst for most of the retired people I know. The only way to make it stop is to sell the house -- an unsatisfactory solution at best. After retirement, with a paid off mortgage, property tax will be my single biggest monthly expense. It is currently $729 per month, and I have noticed it never goes down.

Gee Gumby..... An issue where I seem to be on your left!

I believe in progressive taxes and property taxes are no exception. Make a big footprint with your domicile = pay a big tax bill. Keeping significant assets tied up in real estate, IMO, shouldn't shield you from paying your fair share.

Selling the house isn't an unsatisfactory solution, it's a very viable solution. You're retired, the kids are grown and out of the house, the needs for space and fancy amenities are reduced, so sell and make a little smaller footprint than earlier in life. It makes sense to me.