Comments on: Getting Stuff For Free http://blog.bigzaphod.org/2008/02/29/getting-stuff-for-free/ Huh? Thu, 09 Sep 2010 12:12:40 +0000 http://wordpress.org/?v=2.3.3 By: chris http://blog.bigzaphod.org/2008/02/29/getting-stuff-for-free/#comment-4604 chris Fri, 07 Mar 2008 14:31:28 +0000 http://blog.bigzaphod.org/2008/02/29/getting-stuff-for-free/#comment-4604 The big error in this thinking is the loss of compounded interest. To spend the interest every 1.5 (or 5) years is absurd. You would have new computers, and cars, but your principal would just sit there (and as stated) would be worth less and less over time due to inflation. If you had 85,000 invested and were getting 12% and left it alone through one of your car cycles you would nearly double it, two car cycles, and it's quadrupled, etc. ad nauseam. The idea of skimming the earnings off the top and spending it is insane. I'd much rather drive a beater and have a half a million dollars in 15 years than drive a brand new car every five years. The big error in this thinking is the loss of compounded interest. To spend the interest every 1.5 (or 5) years is absurd. You would have new computers, and cars, but your principal would just sit there (and as stated) would be worth less and less over time due to inflation. If you had 85,000 invested and were getting 12% and left it alone through one of your car cycles you would nearly double it, two car cycles, and it’s quadrupled, etc. ad nauseam. The idea of skimming the earnings off the top and spending it is insane. I’d much rather drive a beater and have a half a million dollars in 15 years than drive a brand new car every five years.

]]> By: Sean http://blog.bigzaphod.org/2008/02/29/getting-stuff-for-free/#comment-4566 Sean Tue, 04 Mar 2008 04:59:20 +0000 http://blog.bigzaphod.org/2008/02/29/getting-stuff-for-free/#comment-4566 Heh.. not sure which planet you're on, but inflation is nowhere near 12%. It's more like 3.5% or so. Which leaves you 8.5% of earnings. And if I did the math right, after taxes you still get maybe 7% increase in the end. My math in the post is very over-the-top optimistic because, as I said, I didn't take all that into account. However if you believe there's no money to be made by investing in the market - you are very, very wrong. Heh.. not sure which planet you’re on, but inflation is nowhere near 12%. It’s more like 3.5% or so. Which leaves you 8.5% of earnings. And if I did the math right, after taxes you still get maybe 7% increase in the end. My math in the post is very over-the-top optimistic because, as I said, I didn’t take all that into account. However if you believe there’s no money to be made by investing in the market - you are very, very wrong.

]]> By: eee http://blog.bigzaphod.org/2008/02/29/getting-stuff-for-free/#comment-4565 eee Tue, 04 Mar 2008 04:28:08 +0000 http://blog.bigzaphod.org/2008/02/29/getting-stuff-for-free/#comment-4565 You're not gaining any "free" money. Even with interest, you're actually losing money. IN-FLA-TION You’re not gaining any “free” money. Even with interest, you’re actually losing money.

IN-FLA-TION

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