patrick.net

I am a compulsive saver, and will always find ways to live below my means and save. However, I can't blame people who live for the present, either, because you just can't predict what is going to happen in life and maybe it IS better to buy your memories when you can rather than defer when they don't matter.

I do know individuals who seem to have lived very well with strategic serial bankruptcies. However, they also seem to suffer from serial divorces.

Greatest drainers of net worth: Divorce(s)/serial marriages (permanent drainpipe on earnings), gambling, both Las Vegas style and investments, chemical dependency/alcoholism, and living at or beyond your means without saving.

Ceffer says

I am a compulsive saver, and will always find ways to live below my means and save. However, I can't blame people who live for the present,

Yeah, saving sucks. I couldn't do it without my wife's cheapness haha.

But if you choose not to save and yet complain that the American way of life is disappearing, come on.

From the 50s to mid-80s people saved at a rate of 10%; now we just go massively into debt. Is it because we are trying to live the traditional American lifestyle and it is out of reach? Or are we demanding ever more and willing to mortgage the house, the car, and the dog, to get it? Probably both. I think our parents all screwed us over, but I also recognize that I demand more for myself and my kids, so I try to put it into perspective.

turtledove says

It will be a very sad time when we look longingly on homeownership as something only multi-millionaires can have... or read bios of professional baseball players to learn which fabulously wealthy family they harken from. Talent and hard work won't stand much of a chance in a world made up solely of kings and everyone else.

You want to change that? Don't support the system.

DON'T support professional sports teams. Vote down any sports stadiums, don't attend any games, don't buy any merchandise. Ignore pro sports completely and encourage everyone you know to do the same.

Don't use Facebook. Ever! Discourage everyone you know from using it as well.

Don't buy the latest and greatest of anything, especially Apple.

Don't play golf or encourage anyone to do so. Actively discourage it as a cool thing to do. Golf courses are a horrible waste of valuable space.

Don't allow advertising to sway your judgement. Best to ignore it completely

Burn your dead, don't bury them. Cemeteries are also a horrible waste of valuable space.

Use credit unions, not banks.

Most importantly: VOTE in your best economic interest whatever that may be. Don't get caught up in political smokescreens.

Oh yes, almost forgot:

DON"T HAVE A BUNCH OF KIDS. More kids eventually creates more demand. If you have more than two kids you are contributing to the problem.

JH says

But if you choose not to save and yet complain that the American way of life is disappearing, come on.

I never said that I have no savings. I said that it isn't super easy for even the highest of wage earners to save the $200k cash reserves needed for the cheapest house in my area. Even if we saved EVERYTHING, we're still looking at years to reach those numbers. Therefore, I'm not surprised that teachers would be having problems.

If you read about the history of the FHA, it wasn't exactly a program designed to help high earning professionals reach their dreams of homeownership. If professionals have to start turning to the FHA or wait years and years to get a house then you are reaching a point where not even our highest wage earners are in a position to easily afford the local homes.

But please, don't address the issues.... Tell me again how the $1500/month I spend on my kids' activities or how our Toyotas with their accelerated payments are the reason why the least expensive four-bedroom SFH listed in my area is 3x an employed physician's annual salary... and they go up from there. How many times everyone else's salary is that?... And that doesn't concern you, at all?

turtledove says

200k cash reserves needed for the cheapest house in my area.

The cheapest house is $1M? If so You should really think about moving.

turtledove says

Tell me again how the $1500/month I spend on my kids' activities or how our Toyotas with their accelerated payments are the reason why the least expensive four-bedroom SFH listed in my area is 3x an employed physician's annual salary

Ok...

Well, I can't it's too tiresome. There is no point in arguing choice of budgets. You are entitled to yours and we have a different approach.

New Renter says

The cheapest house is $1M? If so You should really think about moving.

She said cheapest 4 BR. Remember, it's gotta be a doctor's house not a middle class tract.

JH says

New Renter says

The cheapest house is $1M? If so You should really think about moving.

She said cheapest 4 BR. Remember, it's gotta be a doctor's house not a middle class tract.

OK, let me rephrase that

The cheapest 4br that isn't a teardown is $1M? If so You should really think about moving.

Thanks JH.

New Renter says

The cheapest 4br that isn't a teardown is $1M? If so You should really think about moving.

Hahaha, thanks for clarifying. Sensibly, the bedroom count had no impact on your statement.

Now 7 BR and 2 acre fruit orchard...

That you think employed physicians of any specialty are making $333k/year is laughable. Where are you getting your numbers?

JH says

New Renter says

The cheapest house is $1M? If so You should really think about moving.

She said cheapest 4 BR. Remember, it's gotta be a doctor's house not a middle class tract.

No, it has to be in a great school district, period.

New Renter, my apologies. I thought you based the $1m house price figure on an extrapolation of perceived income. I see you were probably looking at the cash reserves figure. As I'm sure you are aware, banks require more than just the 20% in savings. There are other costs at closing, and the bank isn't likely to allow you to spend your last dime getting into the house. They expect a few months of income in reserves.

Now be nice to me. Those brownies aren't going to make themselves. I bet I won't be hearing any complaints when I use some overpriced, imported chocolate :)

turtledove is right. Property in the Bay Area in a decent school district is beyond the reach of even physicians making 200k+/yr. I am friends with several physicians in that area and they can't afford a SFH there. Even shitty tear downs are well over 1million. No these guys don't drive BMWs. They drive a Prius.

:)turtledove says

JH says

New Renter says

The cheapest house is $1M? If so You should really think about moving.

She said cheapest 4 BR. Remember, it's gotta be a doctor's house not a middle class tract.

No, it has to be in a great school district, period.

Parents make or break a school district. You as a stay at home mom can help a "good" school become great.

IMO one of the big problems with schools is the lack of stay at home parents who have the time and energy to become involved. That may change as the labor participation rate drops but only time will tell. I am also unsure about how well a schools API score correlates with the success of their graduates. I get the feeling the high pressure, high scoring schools can do more harm than good. As a fellow local PatNetter once said its the kids from Gunn HS throwing themselves in front of trains, not the kids from Gunderson.

turtledove says

New Renter, my apologies. I thought you based the $1m house price figure on an extrapolation of perceived income. I see you were probably looking at the cash reserves figure. As I'm sure you are aware, banks require more than just the 20% in savings. There are other costs at closing, and the bank isn't likely to allow you to spend your last dime getting into the house. They expect a few months of income in reserves.

Now be nice to me. Those brownies aren't going to make themselves. I bet I won't be hearing any complaints when I use some overpriced, imported chocolate :)

Accepted :) Now about those brownies....

Edit: Forgot to point out - you should also look into the rules for getting your kids into a better district.

1) Schools in the district where you or your husband work.
2) Schools in the district of their primary after school caregiver (e.g. grandparents)
3) Schools in the district where you rent a small (cheap) apartment.

The first two may require you to be employed full time but I'm sure you can find something that fits the bill. I have heard of many people here in the SFBA who use such tricks to get their kids a better education.

NR, You're right about the high pressure schools. At University here in Irvine, we had a kid commit suicide over a grade... Then his poor, distraught father called the school making terrible threats. All our schools were on lockdown and he was arrested. It was very sad. I don't think crazy would be a strong enough word to describe me if something like that happened to one of my kids. I just felt so bad for the kid, the father... I'm sure other things were going on, as most kids don't end their lives over a grade. Anyway, I get what you mean.

The districts around here make a huge deal about residency. A kid we know moved to Ladera Ranch and the Irvine school wouldn't let him finish the school year. But I will look into it. Just to clarify.... Are you talking about intra-district transfers? Or are you talking about living in (for example) Capistrano Unified and trying to go to Irvine Unified?

JH, thank you for your note admitting you were wrong. It takes a big person to admit he's wrong (just kidding). Thought I'd try to make you laugh instead wearing you out anymore. Did it work? :)

turtledove says

Just to clarify.... Are you talking about intra-district transfers? Or are you talking about living in (for example) Capistrano Unified and trying to go to Irvine Unified?

Well I'm looking into a interdistrict transfer for my kid when the time comes. My wife works in a different district than our home and Grandma is in a different district entirely. I do not know how difficult such a transfer is in reality but I figure it's worth a shot. Grandma pays as much or more in property taxes as her neighbors with kids do so from a financial sense there really is no reason her grand kids shouldn't be able to use the schools she is paying for if that's what she wants.

Anyway the way I figure it any school would be lucky to have my kid attend.

New Renter says

Forgot to point out - you should also look into the rules for getting your kids into a better district.

Good point, especially if your district has a variety of schools. In Fullerton, the most expensive neighborhoods are unaffordable to families, so the schools would literally be empty without transfers. It's just that you don't know from year to year.

However, realize that the rankings (e.g., Great Schools) are based on the kids' scores. Our district has a ton of 10's, but those schools tend to be non-diverse. Here that means either all upper middle class white or all Korean. We choose an elementary school that has all ethnicities and no majority. It's only an 8, which is not acceptable to some of my coworkers, but it's silly. It just means your kid isn't surrounded by "perfect 10s." But our kids are way smarter than plenty of kids at those perfect schools. Our kids have the benefit of good genes, so they don't need a "great school" to make them smart. ;-) Although we feed into a 10 for Jr High and HS, and would have it no other way, not for what we pay at least. haha

New Renter says

I am also unsure about how well a schools API score correlates with the success of their graduates.

I missed this. It correlates with how good your kids' classmates are at standardized tests. I don't think that directly correlates with a less intelligent kid becoming more intelligent after attending a better API school. (Would like some evidence that it does, though.) At least when we are talking about the difference between a "good" and "great" school.

My thought process:

turtledove says

JH, thank you for your note admitting you were wrong.

Wtf did she read into my comment?

turtledove says

It takes a big person to admit he's wrong

Never have I ever!

turtledove says

(just kidding)

Oh.

turtledove says

Thought I'd try to make you laugh instead wearing you out anymore.

Chuckle.

turtledove says

Did it work? :)

Barely. ;-) I would've laughed harder if I knew from the start you were joking. haha

Do the brownies have anything good besides the chocolate? I'm a snob about my MJ, so I wouldn't blame you for delaying your savings for good quality stuff. I do have morals :)

I didn't realize you were in Irvine. I'm sure you could find a fancy townhome with a view of the 5 or 405 and no yard for under a million haha. Your expectations are just too high!

JH says

However, realize that the rankings (e.g., Great Schools) are based on the kids' scores.

I used to teach a series of workshops to help California public school science teachers pass the California Subject Examinations for Teachers (CSET) to become "highly qualified" under no child left behind:

http://www.ctcexams.nesinc.com/about_CSET.asp

The best way to kick ass on a standardized test is to take a lot of similar practice standardized tests. I suspect the higher performing schools tend to drill their kids with such practice tests. Whether the kids actually learn anything is another matter, hence my skepticism of the highest performing schools.

Enforcing my skepticism is my anecdotal experience looking at my classmates. I went to some of the best schools my district had to offer and looking at my peers only a few went on to great success. The kids I knew who went to Bellarmine, a very expensive private Jesuit college prep school did not turn out well. One went to Berkeley and graduated with a degree in accounting. Sounds good but he had a hell of a time finding work. Another kid ended up in and out of jail. If you weren't debate team or sports you were ignored. Of the several kids I went to high school with the ones who achieved what I would consider success did so with family connections and/or hard work.

I'm not saying a good K-12 education isn't important, but I think many parents spend stupid crazy amounts of money on homes to get their kids into "great" schools when perhaps that money would be better spend else ware, like good tutors or karate/dance lessons.

Honestly I think the best thing parents can do for their kids is not let them watch too much TV and closely monitor the TV that they do watch.

JH says

Barely. ;-) I would've laughed harder if I knew from the start you were joking. haha

Do the brownies have anything good besides the chocolate? I'm a snob about my MJ, so I wouldn't blame you for delaying your savings for good quality stuff. I do have morals :)

I didn't realize you were in Irvine. I'm sure you could find a fancy townhome with a view of the 5 or 405 and no yard for under a million haha. Your expectations are just too high!

Oh, but what would have been the fun in telling you up front?! I'd have written more, but I was writing from my phone.

The brownies are top secret and will be served at a special, super secret member and spouses meeting only after a certain law is passed in the state of CA. That's all I can tell you. You'll have to go on faith. Are you in?

Irvine is ridiculous. People think I'm exaggerating when I say that there's very little under $1m. You would be amazed at the prices these houses fetch. We're thinking about heading further south. San Clemente is beautiful and has much more reasonable housing. The schools are a little spottier. So some neighborhoods have great elementary schools and others not so much, but a lot more value for the dollar even in their neighborhoods with 10-rated assigned schools.... and the High School is good. It's a nine, which is still good and probably just a reflection of greater economic diversity (has a fantastic dance team -- tee hee). It's also half way between my husband's two offices. So, it could be a good permanent option for us.

turtledove says

The brownies are top secret and will be served at a special, super secret member and spouses meeting only after a certain law is passed in the state of CA. That's all I can tell you. You'll have to go on faith. Are you in?

Have you thought of holding said meeting in Colorado or Washington? At least until CA gets it together?

turtledove says

The brownies are top secret and will be served at a special, super secret member and spouses meeting only after a certain law is passed in the state of CA. That's all I can tell you. You'll have to go on faith. Are you in?

Aww yeahh. But you know we already have good laws here though not yet the best laws. Your husband should consider branching into alternative medicines. He could probably get the annual fee waived for family!

New Renter says

I suspect the higher performing schools tend to drill their kids with such practice tests. Whether the kids actually learn anything is another matter, hence my skepticism of the highest performing schools.

I see parents send their kids to high performing schools in hopes of helping the kids get a leg up and be more successful perhaps than they were. My impression is that this is silly for reasons I mentioned earlier, but I see your point that the kids may get really good at testing. This could help them all the way through med school, law school, etc. But at some point it would seem to catch up to them. In fact there are kids I know being pushed into over performing schools and then not even making the cut for GATE...which I find hilarious. then the parents think their kids didn't make the cut because they are at such a great school so not everyone could get in.

So am I right in understanding that the school rankings are solely based on test scores?

Your examples of fails are interesting: the best schools can't keep kids off the streets, so to speak, and sometimes teach them how to drill rather than how to work hard, learn, etc...

New Renter says

Have you thought of holding said meeting in Colorado or Washington? At least until CA gets it together?

That's exactly what my husband said. I guess I'm not that committed.

JH says

So am I right in understanding that the school rankings are solely based on test scores?

I believe so, however its been a long time since I was involved with public schools and at that time the system was in a state of flux.

I think school rankings are based - and please someone correct me if I am wrong - primarily on the API scores:

http://en.wikipedia.org/wiki/Academic_Performance_Index_%28California_public_schools%29

JH says

Your examples of fails are interesting: the best schools can't keep kids off the streets, so to speak, and sometimes teach them how to drill rather than how to work hard, learn, etc...

Schools really have no power to keep kids "off the streets". Even parents can't have total control over that and trying to do so tends to backfire.

Call it Crazy says

Even parents can't have total control over that and trying to do so tends to backfire.

Only the ones with poor parenting skills have that problem...

Are you saying that good parenting skills are defined as having total control over one's children that never backfires?

I find that total control over other personality types is a skill I haven't yet acquired. My children have their own personalities. It's very interesting... They're like "people" that way.

turtledove says

That's exactly what my husband said. I guess I'm not that committed.

Might as well wait until you have your $1.2 M kitchen. Brownies taste better if made on granite in a commercial oven ;-)

Rent in a good school district, or pay for private school. You will save money over the long run.

JH says

turtledove says

That's exactly what my husband said. I guess I'm not that committed.

Might as well wait until you have your $1.2 M kitchen. Brownies taste better if made on granite in a commercial oven ;-)

Thank you! Finally! I knew you'd come around eventually. Truth be told, I'd probably be happier with just a regular oven to make room for the giant freezer and wall of microwaves. I used to have time to cook. Now, it's --how fast-- so we can get back out the door. But don't worry. For the brownies, I will make time. One should only have the very best for her first time.

Call it Crazy says

But which personality would you want them to have, the one as a gang banger from the 'hood or as an upstanding citizen??

Depends on the future earning potential.

Call it Crazy says

New Renter says

Schools really have no power to keep kids "off the streets".

Schools have no power to make kids do anything...

That depends.

For instance the kid may be allowed to attend a "great" intra/interdistrict school on a probationary basis - if the kid is too much of a problem then its back to the ghetto. Or perhaps the kid likes playing sports but can only do so if he keeps his nose clean.

Of course if the kid is really, really good at said sport he can be a drug pushing serial rapist and suspected murderer yet still be allowed to play. Such is the value put on sports.

I know a few teachers and teaching is no picnic. As many as 80% are bullied on the job by kids, parents, peers, and admin. This may be a reason that more than half of new teachers quit before 5 years. It may look easy with summers off etc, but try controlling and teaching 35 twelve year olds all day. And not only are there problem children, many parents are an even bigger problem to deal with. Then there are the disrespectful, crazy revolving door administrators who are changed out every two or three years. All of this and more and the constant threat of layoffs with the fluctuating state budget. I doubt many teachers would risk buying a California house. Please leave that to the smart hard working Wall Street "investor" only.

Zakrajshek says

I know a few teachers and teaching is no picnic. As many as 80% are bullied on the job by kids, parents, peers, and admin. This may be a reason that more than half of new teachers quit before 5 years. It may look easy with summers off etc, but try controlling and teaching 35 twelve year olds all day. And not only are there problem children, many parents are an even bigger problem to deal with. Then there are the disrespectful, crazy revolving door administrators who are changed out every two or three years. All of this and more and the constant threat of layoffs with the fluctuating state budget. I doubt many teachers would risk buying a California house. Please leave that to the smart hard working Wall Street "investor" only.

I couldn't agree more.

Their benefits are now being cut and they are threatening to take all spouses off of medical here in California. Some teachers stay in a teaching position they hate so their spouse can have medical, because the spouse owns their own business, is an independent contractor or is a stay at home parent. They cut from the teachers, and struggling families, but not the banks? Seems fair.

New Renter says

Imagine what he'd be saying at his own retirement if mom/dad put that money into a nice Roth IRA index fund instead.

Wouldn't work. Kid needs income in order for mom/dad to contribute into a Roth IRA in his/her name. For turtledove's daughter, that might work, but for most kids her age at the time, that wouldn't work.

dodgerfanjohn says

So what you are saying is that I should in fact blame Obama.

I'm sure there's something you can attribute to the President regarding the bailouts, but my impression is that they started under the previous president. In addition, the President doesn't control the Fed. I'm all for holding people accountable, and there are plenty of things we can criticize the President for, but I'm not sure if bailouts is the best example.

Btw, turtledove, if your husband is at just over $250K/year, you are not in the top 1%. You are part of the 5%-0.51% that gets extra screwed by policies that should be aimed at the top 0.5%. $250K is probably around the top 3%. People who are in the top 10%-0.51% also get screwed by many of these policies because they are relative high-earners that are phased out of a lot of tax benefits that lower income people have but are still wage-slaves.

A great example is the Alternative Minimum Tax. This was a response to 400 extremely high income taxpayers who paid no taxes more than 40 years ago (and probably had no wages). Now, it doesn't really affect the top 0.5% very much, but it does greatly affect many higher income middle class wage-slaves, even with the recent fixes.

Don't they all have nice pensions, work 28 years get 100% of your final salary for life... who can realistically get that kind of deal these days? That should easily afford a house, unless they are looking in Beverly Hills.

FortWayne says

Don't they all have nice pensions, work 28 years get 100% of your final salary for life...

No, they have to work 40 years to get 100%. And in most the country that's about 55K at this point. Sure, in major cities, NY, Chicago, LA, SF top final pay is clser to 75K, and it takes them 10 to twenty years to work up to that level.

I've explained it to you before, but because of your lack of integrity, you're always going to state your position with lies. Did it ever occur to you that it wasn't the teachers fault (that is your lack of motivation and academic success as a child) ?

Most teachers aren't doing it for the compensation. If money was the only goal they would be doing something else.

New Renter says

DON"T HAVE A BUNCH OF KIDS. More kids eventually creates more demand. If you have more than two kids you are contributing to the problem.

I like everything you said here, bub, but especially this. People feel like its their right to breed as freely and incontinently as they please. But it's tilting the scale!

JodyChunder says

New Renter says

DON"T HAVE A BUNCH OF KIDS. More kids eventually creates more demand. If you have more than two kids you are contributing to the problem.

I like everything you said here, bub, but especially this. People feel like its their right to breed as freely and incontinently as they please. But it's tilting the scale!

Our worst and most threatening problem, and yet the biggest taboo to talk about. There is not one issue at the root of more problems, and yet people are usually so defensive I never hear it discussed. Most people avoid the subject at all costs.

corntrollio says

New Renter says

Imagine what he'd be saying at his own retirement if mom/dad put that money into a nice Roth IRA index fund instead.

Wouldn't work. Kid needs income in order for mom/dad to contribute into a Roth IRA in his/her name. For turtledove's daughter, that might work, but for most kids her age at the time, that wouldn't work.

This is a good question for a tax pro. How can said kid earn enough (at least officially) to max out an IRA, preferably a ROTH yet still be considered a dependent on the family return? Is it that hard to do? I think not but given the complexity of the system I'd prefer a pro to say so.