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Home > Net Worth, Suze, & Big Houses

Net Worth, Suze, & Big Houses

April 3rd, 2009 at 03:26 pm

My net worth, went, UP? Woohoo.

IT went up $4k the first quarter.

Cash is up $3k, investments down $1k. Retirement is up about $1k, and we've paid about $1k off the mortgage. That makes for a grand total of $4k UP.

Though I track net worth quarterly, for the long run I only save my year-end net worth, for long-term tracking. I know our net worth was higher somewhere during 2008. But we are higher than year-end. & we are higher than any other year - though not much as far as 12/31/07.

I don't think we've bottomed out or seen the end of the bad news, but it still lifts my spirits, even if it's all on paper. My retirement would not be up $1k if I hadn't been contributing like mad while stocks were in the toilet. Big Grin

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I saw Suze on Oprah yesterday and she was AWESOME. The question was asked recently about which financial guru was best. I was rather, "eh." But Suze is growing on me.

Honestly she didn't say anything I didn't already know. But it's nice seeing her smack sense into people. & I think she just did a REALLY good job. She said something along the lines of, "Don't focus on what you HAD. Focus on what you HAVE." I think that is kind of my life philosophy - always looking forward - not much you can change about the past. I realized recently often people mistake this for a level of "perfection." That I must never do anything wrong. I do PLENTY wrong. I just don't dwell on it. I move on.

I've also said we were too young to lose much. We were focusing so much on buying a house out here we really didn't have that much in stocks. I also invest quite conservatively and and am putting FAR more into retirement today than we have the last few years since having kids. Because of this, I am not staring at $100k+ stock losses. For sure. We put it in about the rate of loss, so little slide backward. But we did lose $100k in 2001 (home equity we were COUNTING on to buy this home with). We never dwelled on it much. We just took the lesson that paper gains mean little, and moved on. I'd like to say if we lost $100k+ in the stock market, we'd be pretty zen. We don't focus on what we can't change. IT's kind of futile. Not that we wouldn't be upset. But we'd move on. I can say that with confidence because we've been there. It was a great lesson to learn right out the starting gate (we were 24 or so when we learned the lessons of the bubble (2001).

I think that was very wise advice from Suze.

She also told the audience to live on HALF of their income. Fact is, people should strive for that in GOOD times. But I liked that advice because that is how we are. Not that we live on 50% today, but we never relied at all on a second income. Many people assume these days, because of my job, that my dh's income must have been the lesser one we gave up. Fact is we were always paid pretty equally. So when he worked we saved 50% of our income. & when he didn't work, it wasn't a big deal to cut our income in half.

50%? That's what I strive for in the long run. Easy peasy on 2 incomes. But we don't know any different. & the only reason we talk of dh never returning to work, is as we near a pretty high savings rate on one income. (50% is a bit drastic - but something to aim for. The more the better). Anyway, it's nice to hear a financial guru say something we've preached forever. & that people usually consider us insane for. Wink

& not that everyone can do that. But plenty more people can who aren't even trying. Then again, it's much EASIER to take that advice when times are good.

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I am not sure what it is about the anti-big-house crowd. But I got to say. I find most of the arguments against buying a bigger house, false.

Because we had more room we didn't run out and buy more furniture. Eventually, yes, when we had kids. But half the house was empty when we moved in, and remained that way for a long time!

We don't have more appliances! We have one fridge, one stove, one oven, one microwave, one water heater, one A/C. We had all the same in our condo! & though our house is twice as big as our condo was it cost LESS to heat and cool. FAR LESS. BEcause it is so energy efficient. It means we don't even run the heat or air most of the year. It doesn't cost twice as much to heat or cool this house (than the one next door). Because most of the heating and cooling does not come from the appliances, it comes from the roof and the insulation, naturally.

My issue with the frugal crowd is they seem to think going big, then everything must cost TWICE as much. With the economies of scale, this simply isn’t the case. Home repairs, etc. usually cost 10% more - not 100% more. & we bought a new home from a builder. The 1500 sf house could have been had for about $230k. $153 per sf. The extra 1000 sf cost only $30k. That’s $30 per square feet for the extra square footage. The perk is today the same house next door (1500 sf) cost $100k LESS than ours. In a dire emergency, we could downsize the house. I wouldn't go broke over a big house, for sure. It is a luxury. I just don't find it to be a very expensive luxury.

{Of course, since we moved somewhere cheaper I admit our experience is truly unique. We used to own a 1300 square foot condo. The property taxes and the insurance are all about the same here, if not less. For the condo the association fees were $250 when we owned, and are like $400, MONTHLY, today. We don’t spend near that much to maintain our current house}.

Another nice perk, is lots are so small here, we have MUCH more land than our neighbors with one-story homes. I’ll take my big house any day!!! (& it doesn't mean tons of yardwork - just mean we actually have a little room to move. Lots in California have gotten smaller while houses have gotten bigger. But we have a similar backyard to our parent's who bought in the 70s/80s. Which to us is a lot of room. We thought so long we could never afford a yard, at all).

We both grew up in homes considerably smaller. If it was really that much more expensive, in our case, we wouldn’t have gone so big, for sure. We could certainly do just fine on much less.

Our house isn't necessarily big by national standards. It's 2600 square feet. But for out here, we know few our age with more than 1300 square feet. For the area, it's kind of big.

All I know is out here (IRL) my mortgage and utility bills are smaller than most of the people who criticize the size of our house. It gets old... It gets really old since we are so mindful of waste, etc. Not everyone who owns a "big home" wasteful. Wink

1 Responses to “Net Worth, Suze, & Big Houses”

  1. my english castle Says:
    1238769488

    I agree--usually Suze gives me a headache, but she was strong yesterday. The live-on-half philosophy was her best point--along with the emotional last point about looking at what you've got.

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