stupid beliefs about finance

bankhater_1965

Uncle_Ben wrote: »

Never completely pay off your mortgage.

Your house is an asset.

Inflation is rising prices.

Stocks are a hedge against inflation.

Index-linked Share Certificates or index-linked gilts are a hedge against inflation.

Stocks always outperform bonds and cash.

Commodities are more dangerous than stocks.

You MUST, you MUST improve your bust....I mean take out a pension.

Cut losses and let profits run.

Tax avoidance is immoral.

how can your house be an asset when the goverment will take it off you to pay for health care in old age and will make it hard to pass over the wealthto family, as to someone without will get it paid for ? and can release the wealth buy cash savings, i dont see the financail gain with that in mind , and it will certainly arrive
to get any decent private pension at the moment would require a huge amount of monthly payments , most people cannot afford unfortunatly
all your ideas are not good in a crash , and we have seen them time and time again

chewmylegoff

bankhater_1965 wrote: »

i disagree on that if you payed rent on a house of £650 pcm which is prob worth in the region of £200,000 for 25 years you would pay £180000 and maintanance free , to purchase the same house over a 25 year period would be a mortgage of £180,000 plus a 10% deposit of £20,000 and a monthly mortgage payment in the region of £1100 per month plus manintance costs over a 25 year period witha limited increase profit from house prices going upbut can also go down ,
so over a 25 year year period
rent =£180.000
mortgage =£ 330.000 plus £20,000 deposit plus maintance at a guess the same would cost you £360,000
this adds upto 50 years rent,,but then you will have to pay for your old age care by prob selling the protery to pay for it as the goverment is intending to close this privalidge to passing on wealth to the family by such meens,
i am a homeowner and i reckon the above has alot going for it by putting the diff of rent and mortgage £s into a savings account !!

you appear to have forgotten to factor rent inflation into your calculation.

bankhater_1965

chewmylegoff wrote: »

you appear to have forgotten to factor rent inflation into your calculation.

i thought the buildings insurance payable on a mortgage would offset such a rise

EconomicsGirl

My favourite has to be

Iceasave a clear difference

though to be fair there was a clear difference, first time I've ever had to claim money back from the FSCS. Possibly not the last, the way things are looking at the moment in the eurozone, but advice to take your money out and keep it in cash is just crazy.

My Dad always likes to point out Icesave should never have been on best buy tables, but I always point out to him in the end somewhat amazingly I did get my 6.7% interest.

LittleMissAspie

bankhater_1965 wrote: »

i disagree on that if you payed rent on a house of £650 pcm which is prob worth in the region of £200,000

Where is that? In my area the £650 rental houses are £140,000 to buy. This affects your figures substantially. I don't think comparison sums can really be done without using real life figures.

Rent isn't dead money because dead money implies you aren't getting anything for it, but you are getting a roof over your head. Whether that roof was good value for money or the cheapest option is another matter.

Uncle_Ben

bankhater_1965 wrote: »

how can your house be an asset when the goverment will take it off you to pay for health care in old age and will make it hard to pass over the wealthto family, as to someone without will get it paid for ? and can release the wealth buy cash savings, i dont see the financail gain with that in mind , and it will certainly arrive
to get any decent private pension at the moment would require a huge amount of monthly payments , most people cannot afford unfortunatly
all your ideas are not good in a crash , and we have seen them time and time again

Erm - Bankhater. Go back to the OP. I think there is something you may have missed.

sabretoothtigger

the biggest belief is that you can pick a fund or share that will beat the market

get real - no one beats the market

Thats a circular argument. Some factor will define the market, it might be a minority but a couple will outperform.

It does often make more sense to be in the right sector then one particular company. From August till now Tech has done very well, you didnt really have to pick just Apple even if they performed best.

bankhater_1965

LittleMissAspie wrote: »

Where is that? In my area the £650 rental houses are £140,000 to buy. This affects your figures substantially. I don't think comparison sums can really be done without using real life figures.

Rent isn't dead money because dead money implies you aren't getting anything for it, but you are getting a roof over your head. Whether that roof was good value for money or the cheapest option is another matter.

my mum rents a bungalow here in cheshire , market price approx £200,000 rent price £625 pcm empty

bankhater_1965

Uncle_Ben wrote: »

Erm - Bankhater. Go back to the OP. I think there is something you may have missed.

there prob is , i will have to put my glasses on :rotfl:

mumf

bankhater_1965 wrote: »

i disagree on that if you payed rent on a house of £650 pcm which is prob worth in the region of £200,000 for 25 years you would pay £180000 and maintanance free , to purchase the same house over a 25 year period would be a mortgage of £180,000 plus a 10% deposit of £20,000 and a monthly mortgage payment in the region of £1100 per month plus manintance costs over a 25 year period witha limited increase profit from house prices going upbut can also go down ,
so over a 25 year year period
rent =£180.000
mortgage =£ 330.000 plus £20,000 deposit plus maintance at a guess the same would cost you £360,000
this adds upto 50 years rent,,but then you will have to pay for your old age care by prob selling the protery to pay for it as the goverment is intending to close this privaliYydge to passing on wealth to the family by such meens,
i am a homeowner and i reckon the above has alot going for it by putting the diff of rent and mortgage £s into a savings account !!

Could not agree more!
Fortunately we paid our mortgage off 3months ago. Took EVERY PENNY we had. Reason was because in 1990 we were stitched up with a crap endowment. A 12 year false start paying interest. Took out a repayment and had to extend another 3years to cut costs. Chuck in home repairs etc. it doesn't make renting look expensive.

Now the house is paid,I just have to look at retirement plans. Got sold a crap pension by the same scumbag financial advisor that sold the endowment.
So thisthread rings very true to me regarding money myths!