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July 2004


I could count on five pairs of hands the people who have told me that there is no way to lose when it comes to investing in real estate. The most emphatic are those individuals who for whatever reason have had very little formal education, and yet some bright people also tend to think this way. It reminds me of the 90s when everyone was gung-ho on stocks. In the “new economy,” everyone who played the game would be rich—at least on paper. This attitude has been proven wrong before; it will be proven wrong again.

All along I’ve been saying there’s as much risk, or more, investing in real estate than there is in stocks. While real estate has never gone down as a whole since the Great Depression, when you buy a house you’re not investing in real estate as a whole. Sarah Max from CNN supports my view and sees a bubble. No one knows when it will pop, and when it pops, I imagine it will pop at different times in different locations.

Be smart. Remember the three tenets of investing in real estate (or in anything): diversify, diversify, diversify.

I’ve been through many changes in the past few months. As you might have read below, I stopped working at my former corporate job and began working as a high school teacher, hence the pause in my 401(k) increases. During the summer, I am working part time at my old job and considering whether I will be teaching again in the fall. When I started teaching, I needed a car to get around, since no public transportation is available. I purchased a 1997 Honda Civic at that time. In June, after having some problems with that car, I decided to purchase a 2004 Honda Civic.

Yes, I know I’ve talked about buying new cars in mostly negative terms. I considered many things, and I decided that buying a 2004 Honda Civic for a good price was the best way for me to go. The car will last me as close to forever as possible, and was not much more expensive than a slightly used version. Included in my “home inventory” is the old Civic which I am still trying to sell.

Additionally, I recently spent a week in California. I managed to limit my expenses there by staying with relatives. The stock market has also not been kind over the past few months. So, on with the financial update:

  July 17 February 17
Cash and Savings: $ 13,200 $ 13,408
Taxable Investments: $ 3,129 $ 3,242
401k (Pre-Tax): $ 9,989 $ 9,660
Roth IRA: $ 3,179 $ 2,041
Credit Cards: ($ 1,709) ($ 2,165)
Student Loan 3.97%: $ – ($ 1,720)
Student Loan 2.82%: ($ 6,323) ($ 9,250)
Home Inventory: $ 13,059 $ 9,454
Equity in Car: $ – $ –
TOTAL $ 34,524 $ 24,575

Lack of Updates

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Yes, it certainly has been a while since I’ve updated here. Since my last posting, I switched careers, albeit only for a few months. I started working as a teacher, which necessitated the purchase of a car. Over the summer, I’ve been working at the job I had prior to teaching, but only part-time. In the next month or so, I’m deciding which path my life and career should take. I hope to post a finanial update soon, and hopefully it won’t be too depressing.