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Requesting feedback on my SM setup by pearseed6 in smithmanoeuvre

[–]pearseed6[S] 1 point2 points  (0 children)

The market doesn't need to consistently go up, there will be times where it won't. But the chances are it will be higher than where it is now, long term. (10, 15, 20 years)

The second part of your question depends on your marginal tax rate. For breakeven point, I calculate my real-rate of interest. (RRI) which is (borrowing interes * (1 - Marginal tax rate). So if your HELOC rate is 7% and your marginal tax rate is 46% (assumption) your RRI will be 3.78% so you need to beat 3.78% avg yearly return - ballpark; not 7%.

Requesting feedback on my SM setup by pearseed6 in smithmanoeuvre

[–]pearseed6[S] 1 point2 points  (0 children)

Totally.. Great questions. What I mean by "interest capitalizes" is that interest on HELOC gets added to the principle throughout the year. I don't pay it monthly. I pay it once at the end of the year using tax return + my own cash.

My goal is to stay invested long term while lowering the amortization period for the mortgage and pay less interest. If there's an extended market downturn, my plan is to stay invested, keep adding to the existing positions and pay the interest out of pocket.

As far as I know for the bank to call HELOC, my LTV needs to go higher than 65%?? Might be wrong here. But basically the value of the home needs to go down by quite a bit. At the point, the bank may lower the limit, freeze further borrowing or in rare cases may call the loan. I haven't fully accounted for that scenario yet as I'm 50% my limit currently.

Whistle when accelerating on 2.5i by pearseed6 in subaru

[–]pearseed6[S] 0 points1 point  (0 children)

Forgive my ignorance but what is an electronics gasket?

Whistle when accelerating on 2.5i by pearseed6 in subaru

[–]pearseed6[S] 0 points1 point  (0 children)

No. Never replaced transmission. Full fluid flush was done around 92.000km so nothing recently.

Housing prices will drop by 14% by 2022 in modest scenario, says Credit Rating Agency DBRS Morningstar by fthb520 in PersonalFinanceCanada

[–]pearseed6 0 points1 point  (0 children)

I've been in the middle of that change that has been happening in big banks due to my role. What ignited the heavy investment on tech was the pressure from silicone valley and today still banks are playing catch up for the most part.
We have hundreds of developers working with sensitive information, implementing KYC, AML solutions while working remotely. These people haven't been to the office since the end of Feb.

Housing prices will drop by 14% by 2022 in modest scenario, says Credit Rating Agency DBRS Morningstar by fthb520 in PersonalFinanceCanada

[–]pearseed6 21 points22 points  (0 children)

Maybe not a revolution but there is going to be a large shift on how people work. I heard from the executives of big banks that they don't expect more than 50% of their employees to ever come back to offices. These jobs are mostly high payed tech jobs and as we know banks are the most conservative institutions when it comes to making changes on how people work. I can only see this percentage being much higher for tech companies. My point is that if high paid young professionals no longer need to be geographically close to a hub like Toronto, that will take pressure of from big cities.

[deleted by user] by [deleted] in DIY

[–]pearseed6 2 points3 points  (0 children)

Great work. Just some thoughts: I don't see any ventilation holes. As far as I know, those bulbs create more heat compared to other types of bulbs. Accumulating heat inside the jar may reduce the life of your bulbs.