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Nice Q ! Is it not what started all this sh$t ?
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Super Contributor
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I regard debt as a prison sentence, forcing one into hard labour. Am now almost debt free with just a small bond on our house. Also have an emergency fund which I think is important
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Super Contributor
Yup - that's why one should have savings, too call upon on a rainy day. Nowadays the flexibond provides a nice haven to be liquid with savings, simultaneously keep the cost of debt (house bond) down.
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Yup - that's why one should have savings, too call upon on a rainy day. Nowadays the flexibond provides a nice haven to be liquid with savings, simultaneously keep the cost of debt (house bond) down. Agreed - but having a rainy day savings fund even at best market rates of about 7% in money market/marketlink vs a bond debt if you are lucky at maybe prime minus 1.8% so 11.2%. Logic just says you are wasting your time saving in a marketlink account vs paying 50% more in bond debt. "Save" in your flexibond to cut interst, sure you don't earn interest but the savings compounded are astonishing.
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Super Contributor
Absolutely nothing wrong with debt. The right debt. Most ppl here are saying they have paid off their mortgages, implying they did take on debt at one stage. 20s and 30s is the time to borrow money for assets, pay them down and sit pretty after that. How many 25 year olds can buy property cash? You'll never save up enough, inflation will work against you. Sometimes the smart thing to do is to borrow money.
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Super Contributor
. .. and what about ppl who borrow to start businesses, or student loans? It's knee-jerk [email protected] to see all debt as the devil.
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Super Contributor
Agree Brazen utter [email protected] having no debt, as long as your return on investment exceeds your cost of debt your in a pretty good place.Jeez!!! it must be boring not having to take any risk at all,
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Super Contributor
Yes Brazen - How else will you fund your chuckles addiction? A Woolies credit card off course. And every month when you look in the mirror at your thighs bum and tummy you know you had return on investment. Not all credit is bad.
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Regular Contributor
I owe I owe its off to work i go.............
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Frequent Contributor
...and the best part of saving in your flexi-bond... is that it is tax free!
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Super Contributor
Yay for Divz and kwagga! I blame that stupid bloody Suze Orman. Instead of buying her endless [email protected] books buy Chuckles.
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Super Contributor
And the flexi-bond is a great idea. Only thing, seem to remember reading somewhere that banks were refusing to give clients access to funds when all this credit sh*t hit? Can anyone confirm this?
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Super Contributor
With those fierce teeth chuckles just aren't a valid snack. I reckon she chomps on Rodin miniatures, or perhaps a giraffe hoof?.
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Super Contributor
Most guys with balance sheets are geared (40-60%), companies are geared everybody is geared! Its all about cash flow without which you are stuffed.
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Brazen "And the flexi-bond is a great idea. Only thing, seem to remember reading somewhere that banks were refusing to give clients access to funds when all this credit sh*t hit? Can anyone confirm this?" Banks only cut off the flexi amount for what you are outstanding on the account. Ie. if you have paid exactly what you should have monthly over a 10 year period of 20 yr bond your possible flexi amount should be roughly equal to 50% of original loan. In the good old days of hedging and risky lending you could then max your account to the original full bond amount (effectively doubling your repayment interest over the remianing 10 years). Now banks are saying you are only allowed to access what you paid in extra into your account. So if you follow the Suzy advise and other such you should plow all extra cash into your bond. So if you paid R100k extra into the bond over X period you can access only that R100k and not the full amount to max yr bond.
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Yes flexi bond ? what is the point of this ??? more money for them banks ! for crying out load !!! they do not give a ***** MONEY MONEY MONEY in there pockets !!! Intrest on capital
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What are the origins of credit. Without it inflation will be close to zero, excess cash will not be available as people pay cash for the house, groceries and cars (clothes too). But salaries will not be as high as well. But in the world of credit, the spenders and the risk takers win hands down. The savers loose to inflation.
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Super Contributor
In my view our whole economic system revolves around credit to a certain degree, without it companies will not be able to do half of that they do, people will almost never be able to get houses, or not easily, most cars would not be on the road... so it makes up a very important part of our economic system, without it we would operate vastly different.
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Super Contributor
Origins of credit...DST will be able to explain better..but the modern Idea of credit began during the shipping merchant perriod in europe..
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