Economics lesson

We may live on the far side of the world, but the economic web keeps us closely tied to events back in the US. Having been in one place for almost three years(!) we’ve met lots of people and heard their stories. The latest chitchat at lunch today came from a teacher at JM’s school. He bought a house in USA at $150k, poured all his paychecks into it to fix it up and pay it off earlier than normal. A few decades later he was ready to sell it at $700k and retire, only to meet the housing crisis full force. He hasn’t gotten an offer above $160k since then. Hence his move to China, where he’ll find steady teaching work and wait until real retirement eventually kicks in.

China is a boom economy right now, but you have to wonder how long it will last. What would happen if a country of 1.6 billion people all lost their savings in a downturn? Real estate is a huge industry here too. One main difference, though, is many people wait till they have all the money to buy property. Makes us wonder if we should do the same.


4 Responses to “Economics lesson”

  1. 1 Mom Falk October 18, 2010 at 10:48 am

    Either way you lose if you can’t afford to hang on and ride out the downturn. Other and more lofty investments pay off with a royal guarantee and the Promise of heavenly dividends—-but money management is important and decisions we make in that sphere tell us a lot about ourselves. Miss you TONS—-

    • 2 Chris Burgwald October 18, 2010 at 3:31 pm

      Buying a house with cash would be amazing! We didn’t, but then again, we didn’t have a financial gameplan until E was born… we spent less than we made, but we didn’t have any direction.

      After E was born, I was mildly concerned about whether or not we’d actually be able to make it on my income alone, so I got a bunch of personal finance books from the library and G read them. 🙂 Then I read the one she thought was best (Dave Ramsey’s _The Total Money Makeover_), and he gave us a roadmap which we’ve followed (with our own tweaks).

      Dave’s got a radio show (you can listen to it online, and he podcasts one hour of it free via iTunes), and one of his “taglines” in the show intro is “This is the Dave Ramsey show, where the paid off home mortgage has taken the place of the BMW as the status symbol of choice.” Someday! 🙂

      Hope you guys are well!

  2. 3 Becca G. October 22, 2010 at 9:25 pm

    I’m doing the Dave Ramsey Financial Peace University. It’s AMAZING! Lot’s to learn!

  3. 4 misspass October 29, 2010 at 4:02 pm

    Yeah, we’re both (Missy and I, not sure which account I’m logged in under, but this is Jeremiah) really amazed by how awful the economy and job market are here. It just seems noticeably worse than it even was a year ago. Who knows, might be back over there in the spring…

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