The DQYDJ Weekender, 11/25/2012

Happy Thanksgiving!

Hope you all had a Happy Thanksgiving!  We hosted my sister (she lives in San Francisco) and my in-laws.  Before you ask: 2 13-lb birds, one made classically and one smoked with mesquite in the smoker (and it turned out to be pretty delicious).

Where Do These Sites Come From?

Remember a few months back when some blogs came out of nowhere to attack the proprietor of the web site I Am 1% over… something?  Guess what – a new blog has picked up the banner of class warfare at our friends at IA1P for… I don’t know, existing?

Well, reading thinly disguised jealousy and class resentment masquerading as good financial advice is a hobby of mine (it comes with writing in this niche).  So I got a bit of a laugh out of a new site trying to punch above its weight.  Enjoy this piece from Dealing With Money.

You readers know my problems with the one dimensional thinking of too many personal finance sites – especially the overarching belief that ‘all debt is bad’.  Of course, any Economics class will quickly explain that every single thing you do is a tradeoff – and there is such a thing as Opportunity Costs.  Opportunity costs are simply the cost of your current activity when benchmarked against some best alternative – say, you choose to sleep, even though you could be earning $100 an hour doing _____.  If you think about costs in that way, you’ll recognize that paying off a 3.75% mortgage may not be the best choice – in fact, it’s probably to your benefit to keep that debt on the books if your other investments can beat that (after tax).

My personal debt is closer to not a lot of money versus two times not a lot of money, but the concept is the same – your net worth is equal to:

Assets – Debts

… not some weird equation like “(Previous Debts x Lack of Stress) ^ (emotions)”.  Go move to Bhutan if you’re into that.

If you have $2 million and you owe $1 million, guess what – you are worth a million dollars, full stop.  You could pay off your creditors if you so pleased.  Remember – debt is a tool, and just like the table saw in your garage it can severely screw up your life if used incorrectly.  However, in the hands of someone who knows what they are doing, debt can be used to make great things.

So, once again, visit our friend’s site and subscribe.  The comments and reactions he receives are a great resource – if you compiled them they would make a great guide about “what not to do”.

Articles We Liked!

  • Nelson over at Financial Uproar will surely appreciate that I liked the guest post he rolled this week from M.D. at Studenomics about buying drinks for women.  And yes – you also shouldn’t buy women drinks while you’re married to another woman.  It won’t end well.
  • Like Darwin at Darwin’s Money, we also have a regular who comes around on trash night to collect bottles (along with a truck looking for metal).  (Nice guys, both)  Darwin enters into the weeds of the pursuit a little bit to show us some of their world.
  • What’s a roundup without some shots of a beautiful home makeover from Paula at Afford Anything?  Even better – she lists her true costs and shows all of the problem areas.  (I know, I’ve got to post some do-it-yourself type stuff, eh?)
  • Burbed’s Black Friday deal post is worth it for the number of hilarious real estate related jokes Madhaus managed to jam into one short article!  (Note to the uninitiated, San Francisco County has one city – SF.  South San Francisco is a separate city in San Mateo County.  Go figure!)
  • 101 Centavos had a pretty funny post on Minimalism (I capitalized it for irony).  True story – I lived in a condo before the house, so I didn’t come in with a huge tool collection.  I’m making up for it now, but sometimes I do feel like I’m mooching off my retired neighbor’s hand tool and gardening knowledge.  Well, I’m giving him a computer – does that make up for it?
  • A Control Your Cash article with a sports comparison as an introduction?  Sign me up!  And yes, I’m a Red Sox fan.  Check the about page – current location doesn’t matter more than original location, folks.

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