A Socio economic discussion about boomers.

[MIFlyer]

Yes, fair point. My example was also a farm. Well, a ranch, but close enough.


All depends on the interest rate. If you can get a 2-3% mortgage (which was pretty easy to do pre-pandemic/global economic meltdown) then paying off your note instead of investing the money elsewhere didn't make much sense.

I understand the math. The reality I've seen is that those in their 50's and beyond with paid off houses are faring better than those who don't, as a group.

 

[TCABM]

Which is why I included the sentence immediately after it. In retrospect maybe out of order, but there nonetheless….

I figured as much, was trying to clarify for others an early distribution results in income tax on the amount withdrawn and the 10% penalty on top of that. That total hit, for most, will be somewhere around 25-34% of the distribution…that’s the ‘why’ most consider qualified accounts as illiquid. The value is eroded significantly if distributed early.

State taxes may also take a bite.

 

[Half Fast]

I understand the math. The reality I've seen is that those in their 50's and beyond with paid off houses are faring better than those who don't, as a group.

Very true, but it also isn't entirely a mathematical decision. The security of owning a house free and clear is also of value. When we paid off our place, I gave a huge sigh of relief. It felt wonderful to be out from under the mortgage, to look at our place and know it was ours, not a co-ownership arrangement with a bank.

 

[DaleB]

Very true, but it also isn't entirely a mathematical decision. The security of owning a house free and clear is also of value. When we paid off our place, I gave a huge sigh of relief. It felt wonderful to be out from under the mortgage, to look at our place and know it was ours, not a co-ownership arrangement with a bank.

Now it's just co-ownership with the government.

 

[Baked Potato]

Now it's just co-ownership with the government.

How so?

 

[Mason]

Taxes.

 

[172andyou]

How so?

I'm guessing he's claiming that paying property taxes means it isn't yours. Which is, of course, absurd and not applied to anything else. But it's a popular claim. I suppose my stocks aren't mine either, since when I sell them I end up giving a bunch of them to the government. And that car isn't mine, because I have to pay taxes to license it.

 

[172andyou]

Very true, but it also isn't entirely a mathematical decision. The security of owning a house free and clear is also of value. When we paid off our place, I gave a huge sigh of relief. It felt wonderful to be out from under the mortgage, to look at our place and know it was ours, not a co-ownership arrangement with a bank.

Yes, exactly. People get rich by investing money and turning it into more money. Someone in this thread mentioned leveraging. That's how people get rich.

But there are definitely non-monetary reasons why lots of people are happier paying off their house.

 

[kyleb]

I’d also differentiate between transferable and non-transferable net worth. For practical purposes, my pension is part of my net worth and can be thought of much like an annuity that’s providing income, but it can’t be gifted or inherited.

What if we don't report your demise, when that day eventually comes? We could turn it into a perpetuity that way. On an annual basis, we could hire hookers and buy a pile of blow in your memory. We'd probably just piddle away the rest of it on airplanes and the like...

 

[TCABM]

I understand the math. The reality I've seen is that those in their 50's and beyond with paid off houses are faring better than those who don't, as a group.

Let’s peel that onion a bit. Peak earnings decade plus largest line item has been taken off the budget. Likely paid off early, which indicates there was some fiscal discipline involved regarding debt and expense management. Also likely indicates other financial decisions resulted in 401k and/or IRA contributions over an extended period and possibly setting aside some in 529(s).

Someone recently said it best “Math doesn’t pause.” Math also doesn’t care about your feelings nor does it dictate what someone does with their money. Once those wheels are set in motion, great things happen over 25+ years. They can be good or bad depending on the decisions made.

 

[Flatiowa]

It also works in reverse, that high morgage balance (or any other debt) that people make minimum payments on is not reducing the priciple significantly for a LONG time. Payments are only servicing the debt for the most part, and reducing the priciple a little bit. Towards the end of the note the principles balance drops much faster. Also something to consider is earning potential and inflation. I saved nothing in my twenties, but I owned my home on a 4 acre acreage free and clear by 25 (worked part time in high school, full time the year after graduating, paid with cash for one year of university and realized right off the cost/return of finishing a degree wouldn’t work out for where I wanted to live and went back to full time factory working. By 30 I was completely debt free, and very comfortable with enough in the bank to reach a… to quote john Goodman in gamblers “f-you” money state of life and never looked back. The freedom of no worries about what you would do if you loose your job, or simple being able to say to heck with it and quit a job you hate pays large dividends on mental and physical health latter.

I spent my early thirties “investing” my money (without loans) on things that would reduce my expenses, and things that would return profits. Truck farm level farming equipment to grow enough basic foods to provide for a years worth each year with enough extra to sell to recap costs. Beehives to do the same with honey (that risk has really blossomed), a small orchard, a well planned mulberry tree patch I put in the first year on the place to run a coppicing and pollarding grow system for wood for heat that began producing excess of what I need to heat my house two years ago, another expense gone. Now as an older, more experienced and valuable asset to companies I earn more in two days than I did in a week in my twenties, and with extremely reduced living costs I can direct a majority share of my earnings into investing in a far more efficient way than I could if I had followed the “plan” that is hammered into everybody’s head.

 

[Bill]

All depends on the interest rate. If you can get a 2-3% mortgage (which was pretty easy to do pre-pandemic/global economic meltdown) then paying off your note instead of investing the money elsewhere didn't make much sense.

I understand the math. The reality I've seen is that those in their 50's and beyond with paid off houses are faring better than those who don't, as a group.

Very true, but it also isn't entirely a mathematical decision. The security of owning a house free and clear is also of value. When we paid off our place, I gave a huge sigh of relief. It felt wonderful to be out from under the mortgage, to look at our place and know it was ours, not a co-ownership arrangement with a bank.

Very young I was hired by one of the bluest of blue chip companies, so many congratulated me and said I was set, as being hired by this company traditionally meant a long, interesting, and well paying career. One could happily work there until retirement, and the company benefits and pension plan were first rate.

But, in the early 90's, times started to change, and this company started to have layoffs. Massive layoffs. And I personally saw guys in their mid-50's, who had great earnings, big beautiful houses (with big mortgages), and kids in college visibly begin to sweat when they got the news. Some even began shaking uncontrollably. These were highly skilled guys in very nitche areas, finding something at their age that paid anywhere near what they needed was next to impossible. And as they were counting on the pension, most didn't have 401ks or sizeable personal savings. Their lives were turned upside down, ruined.

This left a very lasting impression on the young guy I once was, and I vowed to be debt free by 50. Then, if anyone ever pulled the rug out from under me, I'd give 'em the middle finger and move on. Did I miss out some by not leveraging myself up to my eyeballs? Sure, but I slept better.

 

[DaleB]

I'm guessing he's claiming that paying property taxes means it isn't yours. Which is, of course, absurd and not applied to anything else. But it's a popular claim. I suppose my stocks aren't mine either, since when I sell them I end up giving a bunch of them to the government. And that car isn't mine, because I have to pay taxes to license it.

If you sell your stocks, you pay income tax on the capital gains to the government, once. And you absolutely don't have to pay anything to keep owning your car; I have one sitting in my garage that I've never paid a penny in taxes or license fees. You just pay those taxes and fees to drive them on public roads. If it's a farm vehicle or a race car not driven on public roads -- no taxes or licensing. You can keep it forever with nothing forcing you to pay taxes on it.

If you hold land, you pay property taxes annually, and if you ever fail to do so you will no longer own the land. The effect is the same as having a mortgage -- you pay or you get it taken from you. now, in return for that you get certain protections and services from your state and local governments... as do other property owners... and I happen to think that's generally a pretty fair deal. It's not one you get to opt out of if you want, though.

 

[tspear]

If you sell your stocks, you pay income tax on the capital gains to the government, once. And you absolutely don't have to pay anything to keep owning your car; I have one sitting in my garage that I've never paid a penny in taxes or license fees. You just pay those taxes and fees to drive them on public roads. If it's a farm vehicle or a race car not driven on public roads -- no taxes or licensing. You can keep it forever with nothing forcing you to pay taxes on it.

Depends on the state. e.g. VA had a property tax on cars, I believe it has finally been phased out.
MA has a property/registration tax; never looked into how it applies to vehicles that are not on the road.

Tim

 

[TCABM]

….If you hold land, you pay property taxes annually, and if you ever fail to do so you will no longer own the land. The effect is the same as having a mortgage -- you pay or you get it taken from you. now, in return for that you get certain protections and services from your state and local governments... as do other property owners... and I happen to think that's generally a pretty fair deal. It's not one you get to opt out of if you want, though.

Usually a tax lien is filed which can ultimately lead to foreclosure if unsatisfied.

For most, property tax is an emotional issue, not a logical one. I personally detest that the local school districts constitutes 60% of my residential property tax bill considering I’ve never have not never will put a kid in their schools….both mine are grown adults and schooled elsewhere.

The flip side is that school district is highly desirable which has a positive effect on the value of my house.

 

[SoonerAviator]

Usually a tax lien is filed which can ultimately lead to foreclosure if unsatisfied.

For most, property tax is an emotional issue, not a logical one. I personally detest that the local school districts constitutes 60% of my residential property tax bill considering I’ve never have not never will put a kid in their schools….both mine are grown adults and schooled elsewhere.

The flip side is that school district is highly desirable which has a positive effect on the value of my house.

Only impacts you if you want to sell your house though. If I'm retired and in a "forever" home, I could care less what the value is later on because it's in a desirable area/school district. Otherwise, I'd rather take the reduced property taxes.

 

[tspear]

Only impacts you if you want to sell your house though. If I'm retired and in a "forever" home, I could care less what the value is later on because it's in a desirable area/school district. Otherwise, I'd rather take the reduced property taxes.

The reality is most desirable areas with good infrastructure, good services, low crime... have good schools.
There are two models I see in the USA. One is adopted by 99% of the country. The other 1% is extremely large developments for 55 and older; mostly from Del Web which manage to lower taxes by having a special school district with no schools in it. e.g. Sun City in AZ. And that 1% depends on the other 99% to supply the workers to make it all work.
For the other 99% of the country; it is families that are effectively the future for a society. For a locality to attract private investment in developments, offices, businesses, or in retail... means investing in the future. To have workers, you need to attract families. To attract families you need good schools.

Fundamentally, if you want to live in a nice area. Make sure the schools are good. Everything else follows. Want to see a place go downhill? Cut the schools, take away support for the school system. Within twenty years it likely will be a cesspit. You could see the difference when I was growing up between Montgomery County MD, and Prince George's County MD; and even within PG County with pockets of great schools and how those areas did.

Tim

 

[SoonerAviator]

The reality is most desirable areas with good infrastructure, good services, low crime... have good schools.
There are two models I see in the USA. One is adopted by 99% of the country. The other 1% is extremely large developments for 55 and older; mostly from Del Web which manage to lower taxes by having a special school district with no schools in it. e.g. Sun City in AZ. And that 1% depends on the other 99% to supply the workers to make it all work.
For the other 99% of the country; it is families that are effectively the future for a society. For a locality to attract private investment in developments, offices, businesses, or in retail... means investing in the future. To have workers, you need to attract families. To attract families you need good schools.

Fundamentally, if you want to live in a nice area. Make sure the schools are good. Everything else follows. Want to see a place go downhill? Cut the schools, take away support for the school system. Within twenty years it likely will be a cesspit. You could see the difference when I was growing up between Montgomery County MD, and Prince George's County MD; and even within PG County with pockets of great schools and how those areas did.

Tim

I don't disagree at all, as it pertains to funding of the "public good". I was just digging into the idea that the higher tax (in return for better school district) benefits everyone who owns a home. If you need to sell it for any reason it does benefit the owner by having a higher valuation, if you never sell it the increased value means nothing but increased tax burdens. I do think many schools have abused the tax bond process so they can have nice big football stadiums and fancy renovations where the tax burden could be reduced on the citizens, but that's a different subject.

 

[ateamer]

I don’t mind paying taxes for schools if they use the money for improving students’ intellects and skills to be productive in life. I do mind funding opulent stadiums and Astro Turf fields in one of the best places in the country to grow grass.

 

[172andyou]

I don’t mind paying taxes for schools if they use the money for improving students’ intellects and skills to be productive in life. I do mind funding opulent stadiums and Astro Turf fields in one of the best places in the country to grow grass.

I'm with you on the stadium part, build another science lab or shop wing with that money. But artificial turf is actually less expensive over the lifetime of a field than natural grass.

 

[ateamer]

I'm with you on the stadium part, build another science lab or shop wing with that money. But artificial turf is actually less expensive over the lifetime of a field than natural grass.

Even in Florida? Maybe because of the cost to mow it, but then again it grows fastest in summer when it gets little use.

 

[SoonerAviator]

I'm with you on the stadium part, build another science lab or shop wing with that money. But artificial turf is actually less expensive over the lifetime of a field than natural grass.

Eh, it's tough to say on that. The artificial turf often has to be replaced in about 10 years. Tough to justify the cost of turf and installation over water/fertilizer and groundskeeping (mowing/striping) in many areas. Especially if you are already maintaining the rest of a school campus for mowing duties. I think at best it's likely a net-zero proposition, financially.

 

[Bob Noel]

But artificial turf is actually less expensive over the lifetime of a field than natural grass.

which surface contributes to more sport injuries?

 

[DaleB]

which surface contributes to more sport injuries?

I have read that several colleges either have or are planning to switch back to grass for that reason. I don't know how much of it is based on data and how much is personal preference of coaches and ADs.

 

[172andyou]

which surface contributes to more sport injuries?

That's an external cost.

Ok, seriously, it's not clear that one is better than the other if you're compared modern artificial. Older artificial surfaces could be pretty rough, but we're 40 years into that revolution now and they've improved tons.

For me, I would strongly prefer playing soccer on a modern consistent artificial surface over a typical natural surface.

 

[JackL-3J]

I understand . . . those . . . with paid off houses are faring better than those who don't, as a group.

Agreed.

 

[JackL-3J]

That's an external cost.

Ok, seriously, it's not clear that one is better than the other if you're compared modern artificial. Older artificial surfaces could be pretty rough, but we're 40 years into that revolution now and they've improved tons.

For me, I would strongly prefer playing soccer on a modern consistent artificial surface over a typical natural surface.

Landing on, or flying off of, Astroturf . . . sacrilege, sacrilege I say!

 

[172andyou]

Landing on, or flying off of, Astroturf . . . sacrilege, sacrilege I say!

Oh man, now I want to do that! A slow motion shot of the infill getting blown back when the power is applied would probably be something to see!

 

[ateamer]

I loved playing football on real grass. The mud, grass stains, and puddles were almost as much fun as hitting.

 

[JackL-3J]

I loved playing football on real grass. The mud, grass stains, and puddles were almost as much fun as hitting.

Don't forget having a chunk of turf lodged in your faceguard.

 

[ateamer]

Don't forget having a chunk of turf lodged in your faceguard.

The worst possible fate that could befall a football player is to finish the game with a clean uniform.

 

[Bob Noel]

The worst possible fate that could befall a football player is to finish the game with a clean uniform.

except the punter

 

[flyingcheesehead]

Mom/Dad are Silent Generation. Me/Wife are X. One kid is Millenial, one is Z. Five generations across.

My dad is Silent, my mom and both my in-laws are Boomers. So my dad to my sons is six generations!

That said, the named generations mostly only last 15-18 years with the exception of the Greatest Generation (27 years) and real generations don't seem to go quite that quickly. Just found something that said that in developed countries the average between familial generations is in the high 20s. But from my dad to my younger son is a delta of 81 years.

The good news is that, once again, I am above average.

Oh man, now I want to do that! A slow motion shot of the infill getting blown back when the power is applied would probably be something to see!

Turf turds!

I bet performance would be notably better than real grass, but maybe not quite up to paved.

There are definitely some ridiculous stadiums at schools, especially in the greater Texas area... I remember watching the Div. 2 NCAA football championship game in a bar a few years ago and it was being held in a high school stadium in TX. (McKinney ISD.) That's just... crazy. That said, football, cheerleading, and marching band are all a big deal down there. I do wonder how much they spend per student on the stadium vs. academics though.

 

[172andyou]

Even in Florida? Maybe because of the cost to mow it, but then again it grows fastest in summer when it gets little use.

Mowing, watering, striping and fertilizer add up quickly. And that's if it's not used much.

Once you use it, you get to repair all the damage. This is not only the obvious damage from chunks being ripped out, but also regular reseeding or resodding of larger areas that were destroyed during that nail biter of a victory on a rainy friday night or the big swaths of turf that died from being trampled over the course of the season.

 

[kyleb]

I don’t mind paying taxes for schools if they use the money for improving students’ intellects and skills to be productive in life. I do mind funding opulent stadiums and Astro Turf fields in one of the best places in the country to grow grass.

Artificial turf means you can play on the field 24/7/365 if you need to. The band can practice on it, the lacrosse team can play a game, you can have multiple football games, plus a couple of soccer games. During school hours, you can have PE classes there. And you can do it day after day ithout destroying the field. Even better, you can use it during or right after a rain and you won't tear up the field.

That ain't the case for natural grass fields. With natural grass either you eliminate some activities OR you need multiple fields. Since land and stadiums are expensive and grass maintenance ain't cheap either, artificial turf results in a huge cost savings for the schools while permitting use much more often and in all kinds of conditions.

The only place were artificial turf doesn't make sense is at a land grant college where there's a reason (the Ag school) to grow grass. And even those schools have artificial turf practice fields, mainly for the reasons I noted.

 

[Flatiowa]

Or maybe not spend 3/4 of the school’s budget on recreational activities and instead spend it on things that will actually prepare them to be success self providing adults when they finished??? What exactly is the percentage of students whom “benefit” from these recreational expenditures EVER make a single dime in their life from them…? Yes team work, discipline, yadda, yadda, but schools should be a place of EDUCATION.. I will now see myself out.

 

[Bob Noel]

Artificial turf means you can play on the field 24/7/365 if you need to. The band can practice on it, the lacrosse team can play a game, you can have multiple football games, plus a couple of soccer games. During school hours, you can have PE classes there. And you can do it day after day ithout destroying the field. Even better, you can use it during or right after a rain and you won't tear up the field.

That ain't the case for natural grass fields. With natural grass either you eliminate some activities OR you need multiple fields. Since land and stadiums are expensive and grass maintenance ain't cheap either, artificial turf results in a huge cost savings for the schools while permitting use much more often and in all kinds of conditions.

The only place were artificial turf doesn't make sense is at a land grant college where there's a reason (the Ag school) to grow grass. And even those schools have artificial turf practice fields, mainly for the reasons I noted.

yup - turf is awesome, except for the injuries caused by the turf. But, not to worry, someone else pays that bill.

 

[kyleb]

yup - turf is awesome, except for the injuries caused by the turf. But, not to worry, someone else pays that bill.

Tremendous thread drift - ignore if you want.

People get hurt on natural grass too. I saw Deshaun Watson wreck a knee on natural grass. It happens. That said, natural grass is a wonderful surface if it is seldom used, properly maintained, and "in season". But that's a pretty limited scope unless you're a pro or college team with a separate practice facility and no other users for the field.

Older generations of turf had issues around being rough on athletes. I played intramurals and other games on Grant Field (Georgia Tech) in the '80's. The field was basically a rug (no pad) over a hard packed base. It was worn out, so there was no traction. The concrete like underlayment (earthwork) made it a tough place to play. I also played on Tech's intramural fields of the day. They topped those fields with sand - not river or beach sand (which have round edges and corners). They used "new" sand - stuff busted/ground just before they put it down. It was brutal - every grain of sand had sharp edges and would tear you up.

New generations of turf don't have those same problems. There are sports physiologists and engineers who dial the properties of turf to match what the customer wants. You can make it hard, you can make it soft - the base, the pad, the fill, all go into that. Basically, we're talking about a fast or slow playing field. The quick fast guys want the hard(er) playing surface to take advantage of their skill set. Until they get concussed. The big, strong guys would rather the field be very soft to diminish the speed/quickness advantage of the fast twitch guys. The TV guys want a fast (hard) surface, 'cause a fast surface makes for spectacular plays which are good TV. A field can be engineered to be very soft, very hard, or anywhere in between.

With regard to traction, again, the quick guys want the best traction. Until they over-torque their knee and it blows out. Kinda the same for the slow twitch guys - they want good footing. Until they have a foot planted and someone rolls up on them from the side or behind and they tear something. Less traction? Now guys are slipping and sliding around. The yarn that goes into the product is the biggest driver of traction. The properties are known and understood.

You make your choices and get the results that are engineered into the product. Tall turf, short turf. Soft base (earthwork), hard base. Soft underlayment (thick pad), hard thin pad. Soft filler (walnut shells), hard filler (sand). High traction, low traction. Which ones do you bias your field towards and away from? All fields have inherent compromises. Which ones does do you want?

With natural grass a dry field is like concrete and a wet field is like a bog, but you may not be able to control that on gameday (especially if you're a municipality that can't afford to baby a natural grass field).

From an injury standpoint, do you prefer variability (natural grass) or something that behaves consistently and with the characteristics you selected?

And at the end of the day, there will be injuries on turf or grass. There's no escaping that. But with properly selected turf fields, you can dial the product characteristics to balance the injury risk vs the performance risk.

 

[tspear]

And at the end of the day, there will be injuries on turf or grass. There's no escaping that. But with properly selected turf fields, you can dial the product characteristics to balance the injury risk vs the performance risk.

You explanation is much better than I could do. Thanks.

I have friends/family that used to be on the board of trustees for a couple of community colleges and for a sports complex. I can recall learning from one of the board members (Tony) who initial objected to astro turf after seeing many people injured on it how complicated this stuff can get. One of the things that was fascinating to me was how they ended up "tuning" the fields based on the predominate usage. Soccer required much higher traction but much softer padding to reduce injuries. Foot ball, rugby, band... went with less traction, longer weave, and harder fields for a faster game of play knowing everyone was wearing padding.

Really kind of interesting to learn back then; and I am sure I do not recall it all perfectly. Now I wonder how much of this has changed; not just the technology and application. But the requirements. e.g. Does soccer now want a "faster field"?

Tim

 

[Bob Noel]

continuing the thread drift... I wonder about the advantages of using turf for golf courses...