Easy Change

Despite all of the back and forth about sub-prime mortgages and the housing bubble, I am feeling just fine. The reason is that when purchasing, I followed some old advice: Don't expect to flip. In general, I've been told by many people that you shouldn't buy a home unless you plan to hold on to it for 7 years or longer. If the market does well and you decide to sell, fine. But if you want to be sure not to lose money, don't buy something that you only want for a year or two. I've been in my current location for more than 3 years. I like it. And I have no intention of leaving in the short or medium term. It seems to me, that real estate, like any asset class, has its ups and downs. But as a practical point, I don't look at my home as an asset per se. Rather, I consider it to be a fixed expense that I need to survive, much like food and water. Therefore, as long as the payment is reasonable and it functions to keep me warm and sheltered and comfortable, that is a...

So, its been a while since I've written anything and I think it is interesting to start looking at some macro ideas. I'd like to sum up a couple of conversations I've had recently about the economy. With a friend over the holidays, we were discussing the economy and people were asking me what the best thing to do was. I told them that I thought that the time to "prepare" and "react" to this situation is long since gone. People that are leveraged in investments or real estate are going to have a hard time unless they have liquid cash to weather the storm. An emergency fund is key here and most people don't have serious free cash flow to save money right now, especially with the cold winter and holidays coming up. So, the takeaway for people in trouble is to do the same old boring things: 1. Build an emergency/freedom fund to handle these lean times that we're in. 2. Cut spending and increase earnings so that you can have a good "cushion"...

So I am about to go on vacation; plane leaves tomorrow. And since this is a blog about money, I thought that I would talk a little bit in this post about my plans for the vacation and how I plan to manage the money. 1. I plan to bring several hundred dollars of american money to convert to foreign currency in an airport exchange. 2. I plan to bring several hundred dollars of travellers cheques in american currency which I will likely exchange at the hotel or a bank during my stay. 3. I plan to use a credit card for major purchases and to pay for parking when I return. Even though this vacation will be somewhat expensive, it will be quite fun since the money has been diligently saved up in order to really enjoy it. Furthermore I feel comfortable with my progress toward financial goals so this will be a real treat. Of the options above, here's why I am doing each. First, I like to have some currency on hand. Second, I like to have additional currency that is available in the event o...