I feel so poor...

[ThistleMae]

we use propane and one recommendation i would make is to get the largest tank you can manage with the space you have available. we originally had a 500 gallon but went on a wait list several years ago to upgrade to a 1000 gallon b/c i watch the pricing trends so i can do major fills when prices are lower (even absent current inflation trends it varies significantly seasonally depending on demand). i tend to do a major fill in the less expensive summer months vs. waiting until the higher demand/historically more expensive autumn months.

Great advise....thank you. My son-in-law worked for a fuel company for years and he is very good at figuring things out. I will mention it to him.

 

[MomToOne]

Even if your mortgage is at 2.635%?

We just bought last year…..

Depends on where you are in your life, and what else you would be doing with the money. I have a similar rate, and am pushing to pay it off early anyway so it is paid off by the year I am hoping to retire. And if you have surplus funds just sitting in the bank, you are earning less in interest than you are paying on the mortgage, so it could make sense to put that towards the house. Even if interest rates rise on savings accounts - which they should - it's going to take awhile for them to hit 2.6%.

And if that money is sitting in the stock or bond markets? Well, that ship may have sailed already......

 

[LYSE]

Even if your mortgage is at 2.635%?

We just bought last year…..

We had a payed off house, (actually paid cash) ended up taking out a mortgage the rates were so low having it unleveraged made no sense.

Some people are just simplistic about it with a no debt attitude..which is fine and probably good ...they generally are just not capable of seeing it from another point of view.

 

[barkley]

Depends on where you are in your life, and what else you would be doing with the money. I have a similar rate, and am pushing to pay it off early anyway so it is paid off by the year I am hoping to retire. And if you have surplus funds just sitting in the bank, you are earning less in interest than you are paying on the mortgage, so it could make sense to put that towards the house. Even if interest rates rise on savings accounts - which they should - it's going to take awhile for them to hit 2.6%.

And if that money is sitting in the stock or bond markets? Well, that ship may have sailed already......

it's going to interesting to see what happens with interest rates in the next couple of years. we may have many mortgaged homeowners in the same situation i saw others in during the recession of the 80's-existing mortgages costing them less in interest than they could earn in so much as a simple cd. many of my parent's contemporaries back then had plans of paying off their mortgages before they retired but when they could earn double (even close to triple for a period of time) they put off repayment in favor of grabbing cd's and earning more to build their savings.

 

[DCLMP]

Even if your mortgage is at 2.635%?

We just bought last year…..

I would focus more on an good emergency fund and food supply in todays economic climate

 

[ruadisneyfan2]

Even if your mortgage is at 2.635%?

We just bought last year…..

Hmmm…. You do have a long way to go. We had around 7 years left and a balance of $106k. Our rate was 3.0% but it still saved us thousands in interest.
Then again, extra payments early on have a higher impact overall.
Mortgage payoff calculators are wonderful tools to demonstrate the benefits of extra payments.
It’s eye opening.

 

[TheSouthernBelle]

I can’t speak for them but in Canada we don’t lock in a rate for the life of the mortgage, and most people (not all) get a five year term. So I have to renew every five years. Got the best rate there was at 3.69 three years ago and it’s going to be much higher when I go to renew. So paying down what I can now is important.

Coincidentally Canadians that bought in the last year or so with super low rates but very inflated prices are going to be paying a great deal more at the five year mark. There’s been a bunch of articles in our national news lately saying this is going to cause a crisis for these buyers. One poll suggested 25% of Canadians polled would have to sell if the rates go much higher. And they will.

Wow I never knew that. Knowing this I suspect a lot of houses in Canada will be on the market in a few years. I know rates in the late 70s we’re mid teens. Before my time but that’s a crazy thought.

 

[ruadisneyfan2]

We had a payed off house, (actually paid cash) ended up taking out a mortgage the rates were so low having it unleveraged made no sense.

Some people are just simplistic about it with a no debt attitude..which is fine and probably good ...they generally are just not capable of seeing it from another point of view.

I am capable of seeing another point of view but I also know what’s best for us. I am in my mid 50’s and have been paying on mortgages since I was 26. I’m over it. Dh is 64. We dont want to deal with mortgages in retirement. If others choose to, and feel comfortable doing it, that’s their business and I wouldn't knock someone for making that choice.
I personally love being free from debt.

 

[RamblingMad]

Disney has been raising prices faster than inflation for decades. So unless your salary is growing faster than inflation, eventually you'll find yourself potentially priced out.

The good news is that once the economy tanks, if you have the excess cash, you'll be able to go to Disney for a whole lot less. This will last a year or two and then return to normal. You'll also see articles online about Disney not keeping up with maintenance much during this period. But you can still get your Disney fix. You'll have to wait.

 

[MomToOne]

it's going to interesting to see what happens with interest rates in the next couple of years. we may have many mortgaged homeowners in the same situation i saw others in during the recession of the 80's-existing mortgages costing them less in interest than they could earn in so much as a simple cd. many of my parent's contemporaries back then had plans of paying off their mortgages before they retired but when they could earn double (even close to triple for a period of time) they put off repayment in favor of grabbing cd's and earning more to build their savings.

The Federal rate went to 20% during that time period - right now, they are projecting 3.4% by the end of 2023. A very different situation. (https://www.macrotrends.net/2015/fed-funds-rate-historical-chart, https://tradingeconomics.com/united-states/interest-rate)

Savings account/CD interest rates run lower than the fed rate. Right now the best I can get is around 1% for an online bank, with the fed rate being 1.75% after the latest hike. Figure the fed rate needs to get to that 3.4% before you will see savings accounts/CDs paying near that 2.6% rate on the mortgage. And until then, you are losing money getting the current lower interest rate - so figure that into your calc.

Could it pay off long term to hold off paying off your mortgage? Yup. But only if you have the discipline to actually save that money once rates get to the right point, and not spend it on other things. Many people won't - that money sitting in a savings account would suddenly be the reason to take a vacation they otherwise wouldn't, or buy a new car, or do a renovation, or just go out to eat a whole lot more. In that case, it's better to just pay off the mortgage.

And note the idea that it could "pay off long term" is a bit tenuous, since any money in savings could still be losing you money due to inflation. You could end up with more money in savings by not paying off your mortgage, but it will still be worth less than what it was the day you earned it. The only way to hedge against that is to go with different investments, and you have to be able to tolerate bear markets like we have today without freaking out...

 

[RamblingMad]

The Federal rate went to 20% during that time period - right now, they are projecting 3.4% by the end of 2023. A very different situation. (https://www.macrotrends.net/2015/fed-funds-rate-historical-chart, https://tradingeconomics.com/united-states/interest-rate)

Savings account/CD interest rates run lower than the fed rate. Right now the best I can get is around 1% for an online bank, with the fed rate being 1.75% after the latest hike. Figure the fed rate needs to get to that 3.4% before you will see savings accounts/CDs paying near that 2.6% rate on the mortgage. And until then, you are losing money getting the current lower interest rate - so figure that into your calc.

Could it pay off long term to hold off paying off your mortgage? Yup. But only if you have the discipline to actually save that money once rates get to the right point, and not spend it on other things. Many people won't - that money sitting in a savings account would suddenly be the reason to take a vacation they otherwise wouldn't, or buy a new car, or do a renovation, or just go out to eat a whole lot more. In that case, it's better to just pay off the mortgage.

And note the idea that it could "pay off long term" is a bit tenuous, since any money in savings could still be losing you money due to inflation. You could end up with more money in savings by not paying off your mortgage, but it will still be worth less than what it was the day you earned it. The only way to hedge against that is to go with different investments, and you have to be able to tolerate bear markets like we have today without freaking out...

For fighting against inflation and minimizing risk, I have maxed out I Bonds and started to build a TIPS ladder. I don't know what else to do.

 

[MomToOne]

For fighting against inflation and minimizing risk, I have maxed out I Bonds and started to build a TIPS ladder. I don't know what else to do.

Yeah, I feel you. The problem with I bonds is the 10K limit per year. And the shortest TIPS is 5 years. In the end, both I bonds and TIPS kind of keep up with inflation but don't really grow much beyond that. (And note you can still lose money on TIPS: https://www.thebalance.com/why-are-...ry,receiving their biannual interest payments.) In the long run, a stock/bond portfolio should pay off better than TIPS.

But in the short run, boy am I looking at account balances and freaking out.........I just have to remind myself I invest for the long run, not the short run. Every.Single.Day LOL

 

[RamblingMad]

Yeah, I feel you. The problem with I bonds is the 10K limit per year. And in the long run, a stock/bond portfolio should pay off better than TIPS. But in the short run, boy am I looking at account balances and freaking out.........I just have to remind myself I invest for the long run, not the short run. Every.Single.Day LOL

I am slowly moving my emergency fund to I Bonds. You also can't redeem in less than a year. TIPS have no limit and provide a real yield now. But you're exposed to interest rate risk.

https://www.bloomberg.com/markets/rates-bonds/government-bonds/us

 

[BaybeeYoda]

Ibonds are great (right now) except that you are capped at a certain amount...

 

[DCLMP]

For fighting against inflation and minimizing risk, I have maxed out I Bonds and started to build a TIPS ladder. I don't know what else to do.

Why bonds that risk is just as high.

 

[escriven75]

Not when you're on a Disney fan message board. If anyone would understand the OP's point, it would be the people here.

Now if someone posted that they are stuck deciding whether to pay their rent or buy food, it would be in poor taste to chime in with "Yeah, I can't go to WDW this year. I feel so poor, too!"

Yes, well said. This is the place to do that. OP is just sharing the feeling that many on these boards might have, that the things we could previously afford to do we no longer feel we can afford to do.

 

[escriven75]

OP here….

Feeling poor is not being poor. Just relaying that I feel incredibly squeezed by Disney more so now than ever, and was wondering if others are FEELING similarly.

Goodness, did not mean to offend nor make light of those who are actually struggling to make ends meet…

I totally feel what you're saying. We also have gone almost yearly since my littles were actually little. And it took saving and budgeting but did not feel like the same squeeze that our upcoming trip will. Someone previously mentioned lack of hotel discount codes and I second that one. Rarely did we ever pay full room rate. I remember double digit prices a night for some of our stays at Pop! I also remember airfare being 1/3 or 1/4 of what it is now. While that's not Disney's doing it all affects your trip budget. We've done fairly similar trips in the past, usually stay at Pop, 4-8 park days, flight, no sit down meals usually, a hefty Mousebar budget (gotta have that), no super fancy extras. And the price was gradually increasing but wow recently it just ballooned. So I hear you!!

 

[Ms Bibbidi]

.

 

[barkley]

Figure the fed rate needs to get to that 3.4% before you will see savings accounts/CDs paying near that 2.6% rate on the mortgage. And until then, you are losing money getting the current lower interest rate - so figure that into your calc.

true but we are fortunate in not having to deal with it. mortgage is paid off, though dh thought i was nuts to do so i locked in some cd's a few years ago at 3% and since we're not reliant on the earnings for living expenses i'm find with it just sitting and compounding (and they are the kind i can continue to contribute to monthly if i choose). inflation but again we are thankful to be in a situation where we are not AS impacted as others (on average we may do a tank of 20 gallons only once per month, utility use is moderate thanks to the climate). i look back to the greater amount of driving, laundry loads, hot water usage, grocery consumption and general needs based consumption we had when we were raising our kids and i have tremendous concern and sympathy for everyone who has to deal with this.

p.s.-just saw that locally mortgage rates rose today to 6%. kudos to those who were able to lock in those crazy low rates.

 

[DCLMP]

For people who went through the economic turmoil of the 1970s and 1980s with gas shortages, runaway inflation, high interest etc (sounds like now), it was a full decade before things settled down into a new normal. Those who were adaptable were most successful. They had to adjust their expectations and sometimes their standard of living to have more comfort in riding those tumultuous times. It is when the expectations are so far apart from what we have available that the sadness and feelings of loss hit us the hardest. If someone expects little and is grateful for the achievements beyond that, the feelings are upbeat. Life changes. Those who can adapt will thrive. Perhaps it is time to shelve trips to Disney for the foreseeable future. Create new and interesting hobbies and things to do.

There wasn’t the amount of debt back then. The global debt market is very unstable .The ECB is even taking emergency measures to try to stabilize it. Japan is on the brink. The Fed will do the same and all that will be inflationary. It may help the market in the short term, but it’s just a band-aid on a broken leg. This has the potential to be much much worse than the 70’s. In my opinion it already is much worse. We’re just in the beginning stages.
I agree with you though I think it’s time to manage expectations. I’m not cancelling anything this Summer, but not thinking past August.