Saturday, March 04, 2017

People don't plan to fail. They fail to plan.

I've said this phrase to my kids a hundred times as a signal that life demands deferred satisfaction.  Sure, it's a lot of fun to spend money on a shiny toy, but it's much more fun to live your golden years eating steak instead of cat food.  So this article spoke to me: "Stop taking pride in not knowing how to do basic shit":
“Being an adult” isn’t some really prestigious title we have to be intimidated about, it’s literally what we all are, whether we like it or not. The question is whether you are a cool, collected adult whose life is not constantly on fire, or whether you’re a Carrie Bradshaw, who literally had to go visit her ex-boyfriend at work to ask for money to not be evicted because she bought too many statement accessories.

Choose wisely, and don’t take pride in being the latter.
The Washington Free Beacon had an article recently about how a Teamsters Pension Fund was essentially broke and could only pay about half of promised benefits.  It's a tough situation for people who worked their entire lives for a comfortable retirement.  But the article highlighted one of these workers and my sympathy dissolved when i read the following:
Acosta's monthly pay out will now be $760 after taxes. He told the Washington Free Beacon that his family is struggling to stay afloat. The stress of his four-decade career in manual labor has left him without any employment prospects and he has turned to his construction worker son and Social Security to help him make his mortgage payments, which are roughly $2,300 each month.
This guy has been working for 40 years and he still has a $2300/month mortgage?  The most charitable thing I can say is that Mr. Acosta depended on his Teamster pension to pay for his outlandish mortgage, the one that should have been paid off a decade ago.

When you place your financial destiny in somebody else's control, sometimes things don't work out like you had hoped.


Unknown said...

Lessee... $2300/month translates to a mortgage of roughly $475,000, with 20% down he's living in a house that cost almost $600,000. Not too bad for a career in manual labor, doncha think?


Eric said...

Most people (such as yours truly) re-financed mortgages when interest rates hit historical lows. I can't even imagine how you can have such a huge monthly mortgage payment after 40 years.

Anonymous said...

Something doesn't add up:

A few minutes with Dr. Google and you find their house value at 418k, and appraised by county at 438k. Pictures of the house show two trucks in driveway, one of which is a Mercedes panal van. A few more seconds of Dr. Google and you see a construction/roofing business in his and the wife's name, likely being run by his kids who still live in the same town. The company has an active and fancy web page.

So, my guess is if the article information is true he mortgaged his house to fund his business, and depending on how the bankruptcy figures into things, he got a crappy interest rate.

Eric said...

Wow, I didn't go beyond "something doesn't add up here."

Unknown said...

Dr. Excel tells me that if he put 20% down on a $418k house, and he's paying $2300/month on a $334,400 30 year mortgage, then his mortgage rate is 7.33%. Not reasonable at all.

But at his age he might have taken out a 15-year mortgage, which comes out to just under 3%, which is within the realm of possibility. Of course, a 3% mortgage would suggest that it's an adjustable rate mortgage, so with the recent talk by the Federal Reserve, he's well-and-truly screwed to the wall.

I imagine that Dr. Google might have details on his actual mortgage numbers (I get offers every month from lenders who know exactly what I borrowed to buy my house, so that number is out there somewhere) but it's getting late and I've got to get up early tomorrow, so.....

Anonymous said...

Another individual profile meant to "put a human face on" another article about another complicated and comprehensive socioeconomic issue?

Who still falls for them? These profiles are always as neat and representative as the annual roster of balcony guests at the last thirty States of the Union, appearing as emblems of inspirational courage, inspirational suffering, or being either the victim or conqueror of the other party's faulty concept of government.

Anonymous said...

I have a 15 year mortgage and a fixed rate of 3%. But as has been pointed out already, you can't take the article at face value. I doubt the reporter fact checked his mortgage payment, and whose to say the guy didn't add a few hundred to the number, as did the reporter as well.