Afford Anything Podcast

You don’t become happy because you’re successful.

✨You become successful *because* you’re happy.✨

Happiness is the precursor, not the consequence.

——
Note: Plenty of successful people are also unhappy, as well — they’re the ones who pursued success as a means to happiness

1 year ago | [YT] | 31

Afford Anything Podcast

A few weeks before he died, Charlie Munger was asked if he had any regrets in life.

Only one, he replied.

"I would have paid any amount to catch a 200 pound tuna when I was younger. I never caught one," he said in an interview with CNBC's Becky Quick.

But at age 99, he didn't have the youthful strength and vitality of a 96-year-old, he said.

"I am so old and weak compared to when I was 96 that I no longer want to catch a 200 pound tuna. It’s just too goddamn much work to get it in. Takes too much physical strength ...

"...Now if you give me the opportunity, I would just decline going after [the fish]. There are things you give up with time.”

Lessons:

✨At the end of your life, you don't think about your net worth. (Charlie's is estimated at $2.6 billion.) You think about the experiences that your money, time and health could afford you. Don't trade the opportunity to enjoy experiences for the sake of clutching onto your cash.

✨If you're under 96, stop complaining that you're too old. The future version of yourself will regard your current age as young.

✨There's no alternative but to act now. Opportunities are fleeting.

1 year ago | [YT] | 135

Afford Anything Podcast

Myth: When interest rates rise, home prices fall.

Fact: Historically there's a weak positive correlation between interest rates and home prices -- they both rise together.

Since 1976, mortgage interest rates and home prices have tended to climb together. There is a weak relationship, but directionally, the relationship is that when one rises, the other rises.

This is the opposite of what many people erroneously assume -- which is that when interest rates rise, home prices fall.

Why do both tend to rise together? Historically, this may be because higher interest rates tend to reflect strong economies. (The Fed raises interest rates to cool off an economy that is growing too quickly). When the economy is strong, home prices tend to rise.

How is our current economy? GDP rose 4.9 percent (annualized) during Q3 2023, the fastest rate of growth in two years. Unemployment is near historic lows, holding steady at 3.8 - 3.9 percent for three consecutive months. These are indicators of a robust economy.

In addition to the economy, home prices are also heavily impacted by supply. The U.S. needs 5-6 months of inventory to have a balanced supply. In Sept 2023, we had 1.13 million units of existing homes for sale, an 8.1 percent decline from last year, and only a 3.4 month supply.

Housing supply is curtailed for a few reasons: (1) high interest rates make it more expensive for builders to build; (2) existing homeowners are disincentivized from selling their homes due to the "lock-in effect" from lower interest rates.

Home prices are likely to be *higher* in the future. If you're going to buy, do it now. Waiting will only result in homes becoming more expensive, not less.

____
Sources:
The Urban Institute, US Bureau of Economic Analysis, Black Knight Home Price Index, Freddie Mac Primary Morgage Market Survey, Bankrate, Fortune

1 year ago | [YT] | 11

Afford Anything Podcast

If you gave someone your calendar and asked, “Can you guess what my priorities are?” …

— would they get it right?

If you handed them a your credit card statement, and asked: “What’s most important to me?” …

— would they know?

1 year ago | [YT] | 13

Afford Anything Podcast

Median age of a repeat homebuyer (someone who’s NOT a first time homebuyer) — 58 years old

Building wealth takes TIME.

———-
Source: National Assn of Realtors

1 year ago | [YT] | 6

Afford Anything Podcast

A sign of intelligence is a willingness to change your mind when presented with new data or information.

Ask someone: “what opinions have you changed in the last 10 years?” — and listen not for the content, but for the quantity.

If they can easily rattle off a half-dozen or more, they likely have an open mind.

Over-identifying with your beliefs creates clouded, illogical thinking.

When your beliefs become your identity, your limbic system — not your prefrontal cortex — reacts to dissenting opinions as threats.

That’s another way of saying, you can’t reason with an unreasonable person.

And the thing that makes a person unreasonable is that they over-identify with what they believe.

It’s OK to have strong opinions, so long as they are held loosely.

1 year ago | [YT] | 19

Afford Anything Podcast

What accounts are in your Happiness 401k?

1 year ago | [YT] | 18

Afford Anything Podcast

If you’re building big dreams, remember:

1️⃣ most friends & family will try to talk you out of it, suggesting a “reasonable” or “safer” path…

2️⃣ … but how did that turn out for them? Is their life inspiring?

Don’t take advice from someone whose life you wouldn’t emulate.

1 year ago | [YT] | 16

Afford Anything Podcast

Money is not “the root of all evil.”

Plenty of people are evil and broke. Money would let them be evil at scale.

Plenty of people are good and broke. Money would let them be good at scale.

Money is an amplifier.

1 year ago | [YT] | 19

Afford Anything Podcast

There are some lessons that you learn as a beginner in personal finance — and you have to unlearn when you’re more advanced.

When you’re a personal finance beginner, you get introduced to the idea that your money can make money.

It’s a revolutionary concept for beginners — the notion that rather than trading your time for money, you can also put your capital to work.

But when you’re more advanced, you need a level of nuance:

Just because you have access to capital, doesn’t mean you need to deploy it.

For example, you might have tons of equity in a home.

Your equity is just sitting there, not being pulled out and reinvested.

Many advanced practitioners of personal finance report feeling anxiety about this.

They stay up at night, worrying about the fact that their Return on Equity (ROE) is so low.

They feel FOMO about their lack of liquidity. The missing reinvestment.

But at a certain point, there’s no reason to take on more risk than necessary.

If you have sufficient investments to reach your goals, there’s no reason to take on additional risk by borrowing against your equity.

By contrast, if you have goals that would be aided by reinvesting that equity, then reinvest it!

Start with the *goal,* not with the desire to deploy all available capital.

1 year ago | [YT] | 26