As from April 2013 my Journey in Investing is to create Retirement Income for Life till 85 years old in 2041 for two persons over market cycles of Bull and Bear.

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This blog is authored by an old multi-bagger blue chips stock picker uncle from HDB heartland!

"The market is not your mother. It consists of tough men and women who look for ways to take money away from you instead of pouring milk into your mouth." - Dr. Alexander Elder

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Saturday, 3 April 2010

Will You Try To Pay Off Your Housing Loan ASAP If You Have One? - Revisit


Read? Will You Try To Pay Off Your Housing Loan ASAP If You Have One?

When I told a few colleagues that I have dumped all available CPF money to pay up and took up only 5-year housing loan. I believe some of them might think that I was stupid not to take advantage of the cheapest loan available.

"debt-free and that, to me, is richness enough" - Tabitha Wang

I am telling you that from my own personal experience in the worst crisis I have encountered - 1997 Asian Financial Crisis that what Tabitha said is definitely the Truth
 
In 1997-98 Asian Financial Crisis (AFC), I have witnessed few colleagues broke down in tears when they were told that they were lay off. Some were so worried about their mortgage payments.


 
At that time, I was less worried than many other colleagues as I was debt-free after paying up 5-year HDB housing loan some years back before the Asian Financial Crisis. Then I finally realized that "I am not Stupid!"

3 comments:

  1. I agreed with u. Debt free is always good.

    Even if u got lay off then u got 1 thing less to worry

    ReplyDelete
  2. Actually owning good debt may not be that bad idea. But the key thing is if one can have the holding period to tide over the crisis period of a few years. If one can pay off his mortgage loan easily, I am sure his cash position will be good enough to last through the crisis period. If the holding period is short, then forget about owning a private property. It's risky in the current property peak.

    I use my cash to do Value Investing and make sure my returns are 2-3 times more than what my mortgage interest is paid to the bank. In this case, I am making money by using bank money.

    ReplyDelete
  3. We are very fortunate.

    We are debt free throughout our life as we are mere wage earners.

    We always live within our means.

    Now, maybe below our means.

    ReplyDelete

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