- Part 1 – Investment philosopophy and saving vs. investing
- Part 2 – Stocks, bonds, and real estate
- Part 3 – Where and how to invest, summary, advanced topics
- “Paying rent is no more throwing your money away than buying food or clothing is.You need shelter. It’s one of the three basic necessities of life. Renting is one way to acquire that shelter and, in some cases, it’s a very intelligent way.”
- “the assumption that a potential mortgage payment will be roughly the same as their rental payment is a false one. Tom’s case epitomizes the situation in which many single people find themselves.”
- “I just want to inform our young friends here, especially the single ones,that renting is not throwing your money away. Look at Clyde … He’s rented all his life, and because his monthly costs to rent have been substantially less than his costs would have been to own, he’s been able to spend more on other things, and he’s been able to save more than ten percent of his income.”
- “What your house is worth, frankly, is of no financial significance whatsoever if you have no intention of ever selling it.”
- Fidelity on 50/15/5 saving and spending rule of thumb: HTML.
- Another fidelity rule of thumb – retirement savings targets by age: HTML.
- Article on 60/40 asset allocation
Home Affordability Suite (New for 2022!)
- The Dave Ramsey Home Affordability Criteria from Ramsey’s website:
- Dr. Moore Derivation of a formula for the maximum home price you can truly afford based on the 3 Dave Ramsey Criteria: PDF. This provides explanation and justification of the 3 criteria.
- Excel implementation of the Dr. Moore formula: XLSX.
Thesis: Everyone who rents is throwing their money away.
Anti-Thesis: Renting is not throwing your money away, you must pay for shelter.
Synthesis: Renting an expensive fancy apartment may be throwing your money away. However, in some places like Silicon Valley or SF, where rents are well over $2000/month, the home prices are also sky-high. Prices are so high, actually nationwide, that it is unlikely that one meets either the Wealthy Barber or Dave Ramsey criteria for purchasing a home.
“I don’t know what is best for someone else. All I can do is choose or reject for myself.” -Quote from Siddhartha by Herman Hesse