Silver getting crushed today

$10K. Ouch. A hefty sum to do that.

To me, $6k was the max calculated "Swallowing Point" - where it doesn't really hurt to pay that cash out. $10 would be a stretch for me.

But if you have the cash I recommend it.
On all the articles I've read they've always mention the "accounting principal" of using that money to pay down the debt, and also the "accounting principal" of why you don't want to pay your house off; both of which is house equity that gains NO interest.

but, looking at the "Economic" and "psychological" aspect of paying the house down and having NO house payment. You have a LARGE cash flow after that as you no longer have a house payment.

Using the accounting principal ... you would then think that renting is preferred over buying. But then you'll ALWAYS have a payment, that is ALWAYS (more likely than not) going up. Conversely paying off your mortgage is a far better thing that no one highlights; especially if you would like to retire one day whether sooner or later. And like you calc'd you no longer pay interest, a further savings.

Also, if you income is stagnant, that rise in rent with inflation eats more of your income. Imagine having no rent/mortgage? A lot of spare cash after that and not having to worry about the payment + interest. Although those pesky city taxes still exist.

In being in my current house for only 5 years, I've also knocked off 5 years of steady payments. With the Reamort ... the paydown is accelerating as I plan on reamort every 3 years now.

Also, I don't know what you interest rates are, but maybe a refinance might help everything overall even with certain fees. But I recommend a Credit Union as many have much, much lower fees - although some credit unions work about the same as many banks so research is key.

 

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Current better APY for a savings account 1.75%
$10k CD ...
12 month 2.2%
3 yr .. 2.45%
4 yr 2.35%

IRA high yield CD = 5yr is 2.65%

but also don't forget to reduce your return due to taxes ....

paying off mortgage .. priceless (and no taxes or finance charges to pay)
and your cash flow opens up significantly.

just don't compare to putting that investment into a high return stock.

 

"looking at the "Economic" and "psychological" aspect of paying the house down and having NO house payment. You have a LARGE cash flow after that as you no longer have a house payment"

Agreed. I always read - don't pay your house off early - invest the money instead. Nope - Several years ago we expanded and renovate our home with features we love - and could age into (single floor home, brick and vinyl siding, walk-in showers, etc). We decided to covert to a 15 year mortgage back then which times well with my wife's retirement. Its been hard making that larger payment. In 8 more years with no crushing huge mortgage I can then drop to reduced hours, and ease into full retirement as I please. We live in a nice little town with many free things to do, hospital, shopping, and beach all within 7 mins drive. Having our nice home paid off will be such a good secure feeling. I dont need or want much in retirement - visit kids/grankids, our home, basic foods, medical, netflix, a few nice free activities around, and a bit of coin collecting.

 

I tell people to Invest AND pay your house down.
Why can't people do both?

I can't understand some people, into their 50s or later buy a new house with a 30 year crushing mortgage. It's like .. are you going to work until you are 85 ?? At some point people like to stop working and not have debt, thus that debt has to be paid off before then.

And then .. seeing ppl in their 40s buy an interest only payment house. I really don't understand that at all.

 

I can swing the 10k, so that's not an issue (not bragging, just saying that I collect dollars, not debt ). I refi'd a few years ago, so my interest rate is 3.125%.

The return on my 10k investment (reduced interest payments) would be about 7% 'tax free', as there is no capital gains tax on it. If I pay an extra $900/mo, for a total of $2050/mo, which would include escrow for my $4k/yr property taxes, I can have my house paid off in about 4 years. What's better than that? Then, or even before, when I sell my house and move someplace less expensive, there will be nothing better than paying cash for a house, with some left over.

EDIT - I think the actual ROI on my 10k, with extra principal payments would be around 4%, but I'll take it. A LOT better than any other low/no risk options out there.

@Clawcoins Thanks again for bringing this to my attention.
I had been thinking about just making a large extra principal payment, at some point, but this method (mortgage recasting) helps even more.

P.S. like you, I invest as well. Have been maxing out my 401(k) contributions for about 8-10 years. Finally got around to opening a Roth IRA this year, too (put the money towards 2017, so I can still max out 2018's contribution).
Ahhh. Debt free is the way to be.

 

To this first part. Of course I do - but it comes down to how much into each. My mortgage is well well above what I put into 401k each month.

 

I like to collect dollars too
your 3.125% beats my 3.75%. Good job.

It's so nice being able to pay cash for stuff. I get discounts when I have my car worked on due to cash.

And that reamort/recast helps a lot if you are dead set on paying off that house as quickly as possible and saving on total interest paid. The banks make it a bit difficult with a large $$. I was already paying $5k a year above on payments … to me it was .. really, I already pay that .. duh.

 

When we bought our house in CA, the interest rate was 10.5% (gulp) but we still managed to pay an extra $100-$200 per month. After 5 years of this, we refinanced to a 15 year loan at about the same monthly payment and still paid extra every month, making it a 12 year loan.

 

I'm thinking my first house in 1991 was 7.5% for 30 yr fixed. I recall refinancing it once which was probably down to 7.5.

looks like a Silver chart ... hahaha

https://res.cloudinary.com/value-pe...ges/Historical_Interest_Rates_Annual_Averages

 

I was out of town on Friday ...
SILVER


GOLD



PLATINUM


US Dollar index 5 day

 

where are we going today ....


PLATINUM


I've been wanting to add more platinum. But when it was about $940 there was only a $10 premium to buy APE proofs versus BU. Now there is a $50-70 premium from BU to Proof. Go Figure. Guess I'm not buying Platinum unless it's BU. Guess I'll buy some 1/4oz gold instead ... maybe

@abuckmaster147 @LA_Geezer

although it looks like PMs are headed up now with the Dollar Index dropping.


Futures pointed down

 

Where are we going? IDK are you driving Claw. I am along for a long long ride I think.

 

I hope your drive (and the price of silver) have a better result than this:

 

with this


and this


who knows as gold deteriorates when it technically should be rising.

about 6 months ago gold and silver ETFs were a normal thing on these inflows/outflows. But no more.


there's been more readings about Gold not being the safe haven anymore. Of course there was a shift to Crypto, but I think that kinda blew up.

The only true safe haven that I know of is cash. But most investor advisors do not like cash ... they can't charge the premiums and transaction fees on other goods with Treasuries, commercial bonds, basic commodities, etc.
But I think there has been an uptick in saving just cash.

My high yield savings account is pulling in 1.75%
Not bad for no downward risk ... assuming you don't think the gov't is going to raid your savings account to pay down federal debt.

1.75% may be better than PMs. After all the 1.75% is a guaranteed upwards investment whereas PMs are not guaranteed returned (especially after you add the storage fees, holding fees, etc on a monthly basis).

1.75% on $100,000 for a large investor brings in (pretax) $1,776 in one year. With relatively no risk. And if the economy keeps going the way it is that interest rate may tick up too during one years time. Mine has been ticking up slowly but surely.

Of course there are other ways to invest your money. Pay down higher interest debt, pay down/off your mortgage. Help me buy a Bentley. Stuff like that. hahaha

When Silver was above $17 I wish I had a good method to liquidate what I didn't want. But the markets I checked into when I was buying it have shifted. Smaller premiums over melt, etc, or tradeback prices lower than previous at those marks. Kinda disappointing. I'm lucky I don't have much "investment type" PMs. Thus demand for PMs may have been dropping, thus supporting the weaker PMs prices even with the various indicators making one think that PMs should be stronger than they are. Supply/Demand coming into play over other impact situations.

But hey, that all could shift tomorrow.

Fyi, That high yield savings account In
June 2018 1.75%
Jan 2018 1.35%
June 2017 0.95% (not much movement until recently)
Jan 2017 0.90%
June 2016 0.90%

 

Guy on Craigslist offering a roll (20) of rounds for $360

 

interesting last couple of days.
SILVER


GOLD



PLATINUM


US DOLLAR INDEX over 6 months


DOW over 1 year



S&P 500 over a year


CPI - selected items


https://www.bls.gov/charts/consumer-price-index/consumer-price-index-by-category.htm

overall
https://www.marketwatch.com/story/c...-fastest-pace-in-6-years-cpi-shows-2018-06-12



markets have stalled ...
PMs downwards trend for SPOT but premium has increased for gov't bullion (ie, price is staying higher)
CPI creeping up


@abuckmaster147 @LA_Geezer

 

WOW !!! Almost time to make a stack I guess.

 

Well, Gold is sliding, stocks are sliding and bonds are stuck. A lot to be said for cash and CDs.

 

I stopped buying CDs and only download my music now.

stocks are being hammered. Might have to cash and and preserve profits if it keeps going down. Then just sit on the sidelines to wait the turmoil to play out.

 

not yet ... looks like it's all gonna keep diving

FUTURES




except maybe gold