Borrowing money to buy up right now???????

[ReturnToZero]

Depends on your motives and your means.

I suck at saving money, but I am awesome at paying off debt... mostly because I hate debt so it works as a great personal motivator.

I borrowed to buy my first 3kg of silver as a sort of 'savings' plan. I ended up paying it off in 4 months, 20 months ahead of the loan term, and the silver has earned (as yet an unrealised) profit of somewhere around 1k. Some of that has been absorbed by interest, but the interest paid is proportionate to the length of the loan term.

So yeah it cost me a few hundred in interest, but the end result is a tidy little stack of pretty shiny stuff that I have wanted to start building for a long time, paid for with cash that would otherwise have been spent on useless purchases of little to nil value.

There is always concern about whether the price is going up and down, but realistically it's going to do that whether you're paying with cash you already have or cash you're paying off. Consider what your motivations are and whether you actually care what the currency value of the metal (or money) is at this point in time, or whether you are in it for some other reason that makes you consider the cost to be 'worth while'.

Do what works for you; in a quantity you can handle; with associated risk you are willing to accept.

After all, I hear the buzz words "measured in ounces" on this forum all the time... So why does it matter where the paper comes from, as long as you can comfortably cover it at short notice?

*commence bombardment*

Whack!!!!!!
I would have been embarrassed to admit to that by my self but now that your here i will. I am a terrible saver, and a loan keeps my in check, just gently nudges me in the right direction. The obvious thing to say to this is "yeah but your losing money in interest", but as far as i am concerned i would have probably bought something useless and virtually wasted my money anyway.

Well, you should probably learn to save? A fairly good way to save is to open a high interest savings acc with another bank and every pay day DD some money. You won't impulse spend what you can't touch or see.

You didn't lose just 11% in a personal loan, you also lost the 6.5% you could have got if it was in the bank as a saving. so that's 17.5% you're losing just to force yourself to save, hardly a bargain. You also expose yourself to risk - if you lose your job you will be in trouble. This is an expense way to force yourself to save.

 

[Still Ballin]

Best thing to do is every pay day, put aside cash and buy some silver and gold and stay out of debt(no loans). Right now there is no way I would invest in SLV and GLD ETF's, as your purchasing something that doesn't exist. Physical silver or gold is the way to go.

When in comes to investing in high interest accounts, you have to consider that there are currently bank runs happening around the world, there are 'bank glitches' every day in countries around the world where people cant access their money. Then you have hundreds of banks that have collapsed in 2011 (almost 70 so for in USA alone).

Try to learn how to save, get out of debt, build a vault under your house and become your own central bank lol

 

[ReturnToZero]

Best thing to do is every pay day, put aside cash and buy some silver and gold and stay out of debt(no loans). Right now there is no way I would invest in SLV and GLD ETF's, as your purchasing something that doesn't exist. Physical silver or gold is the way to go.

When in comes to investing in high interest accounts, you have to consider that there are currently bank runs happening around the world, there are 'bank glitches' every day in countries around the world where people cant access their money. Then you have hundreds of banks that have collapsed in 2011 (almost 70 so for in USA alone).

Try to learn how to save, get out of debt, build a vault under your house and become your own central bank lol

Deposits are guaranteed up to a million. If you don't place your cash in the bank and get interest you are robbing yourself. Unless the Australian government collapses in to total anarchy - in which case it won't - the money will still be there. No civilized modern government will outright confiscate your dollars, if the NK populace revolted when that happened even though their government will shoot you for twitching your eyebrow, imagine what a western country would do. If you think a government guaranteed deposit with one of the big four banks in Australia is not a safe bet, then you seriously have too much tin foil going on.

Edit: I would like to point out it is safe from confiscation or loss, as opposed to the other type of confiscation such as inflation.

 

[Guest]

Best thing to do is every pay day, put aside cash and buy some silver and gold and stay out of debt(no loans). Right now there is no way I would invest in SLV and GLD ETF's, as your purchasing something that doesn't exist. Physical silver or gold is the way to go.

When in comes to investing in high interest accounts, you have to consider that there are currently bank runs happening around the world, there are 'bank glitches' every day in countries around the world where people cant access their money. Then you have hundreds of banks that have collapsed in 2011 (almost 70 so for in USA alone).

Try to learn how to save, get out of debt, build a vault under your house and become your own central bank lol

Deposits are guaranteed up to a million. If you don't place your cash in the bank and get interest you are robbing yourself. Unless the Australian government collapses in to total anarchy - in which case it won't - the money will still be there. No civilized modern government will outright confiscate your dollars, if the NK populace revolted when that happened even though their government will shoot you for twitching your eyebrow, imagine what a western country would do. If you think a government guaranteed deposit with one of the big four banks in Australia is not a safe bet, then you seriously have too much tin foil going on.

Edit: I would like to point out it is safe from confiscation or loss, as opposed to the other type of confiscation such as inflation.

Yeah but the money you advise to keep in the bank is being deflated and devalued, the interest one would gain by having it in the bank will be ravaged and overtaken by inflation.

 

[jnkmbx]

*commence bombardment*

*calculates trajectory, aligns artillery cannons*

 

[ReturnToZero]

Best thing to do is every pay day, put aside cash and buy some silver and gold and stay out of debt(no loans). Right now there is no way I would invest in SLV and GLD ETF's, as your purchasing something that doesn't exist. Physical silver or gold is the way to go.

When in comes to investing in high interest accounts, you have to consider that there are currently bank runs happening around the world, there are 'bank glitches' every day in countries around the world where people cant access their money. Then you have hundreds of banks that have collapsed in 2011 (almost 70 so for in USA alone).

Try to learn how to save, get out of debt, build a vault under your house and become your own central bank lol

Deposits are guaranteed up to a million. If you don't place your cash in the bank and get interest you are robbing yourself. Unless the Australian government collapses in to total anarchy - in which case it won't - the money will still be there. No civilized modern government will outright confiscate your dollars, if the NK populace revolted when that happened even though their government will shoot you for twitching your eyebrow, imagine what a western country would do. If you think a government guaranteed deposit with one of the big four banks in Australia is not a safe bet, then you seriously have too much tin foil going on.

Edit: I would like to point out it is safe from confiscation or loss, as opposed to the other type of confiscation such as inflation.

Yeah but the money you advise to keep in the bank is being deflated and devalued, the interest one would gain by having it in the bank will be ravaged and overtaken by inflation.

Of course, that's why I said specifically it is NOT safe from confiscation such as inflation.

Still Ballin suggested that high interest savings accounts might not be safe for fiat, I disagree - in the bank it is guaranteed and you get a rate of return. Under your mattress the rate of return is 0 and your kid might nick it for booze.

This is in reference to cash you are saving up to buy PM's, not to be kept as fiat indefinitely.

I personally hold a percentage as cash at the bank - I like to keep my power dry.

 

[jnkmbx]

Yeah but the money you advise to keep in the bank is being deflated and devalued, the interest one would gain by having it in the bank will be ravaged and overtaken by inflation.

Inflation will get you _anyway_, so some interest is better than no interest - cutting your losses.

 

[Guest]

I stand by my belief that precious metals or shares in mining companies will be much better off in the future than cash in the bank earning interest. Very much so.

 

[ReturnToZero]

I stand by my belief that precious metals or shares in mining companies will be much better off in the future that cash in the bank earning interest. Very much so.

No one is disagreeing with you. But to buy your $1800 1 ounce of gold, or your $2000 share in a mining company means you need to save money every week. To do that, the best way would be to put that money in to a bank account - not under your mattress because you think the banks won't give it back (i.e. too much tin foil).

 

[Guest]

I stand by my belief that precious metals or shares in mining companies will be much better off in the future that cash in the bank earning interest. Very much so.

No one is disagreeing with you. But to buy your $1800 1 ounce of gold, or your $2000 share in a mining company means you need to save money every week. To do that, the best way would be to put that money in to a bank account - not under your mattress because you think the banks won't give it back (i.e. too much tin foil).

Saving money in the bank to buy an ounce of gold or $2000 worth of shares is of course logical, I'm talking about people wanting to generate wealth in this economic climate would be foolish to think the best way to do it would be to earn interest in a bank account.

 

[Midnight Man]

Deposits are guaranteed up to a million.

Please forgive me if I am wrong, but as far as I understand it, this guarantee is to be eliminated on 12th October 2011, and may or may not be replaced with a new guarantee of possibly significantly lower amount. If it is not replaced, then any amounts on deposit are going to be subject to the bank keeping it's doors open - something I feel is not necessarily a given in the economic times we're experiencing.

http://www.guaranteescheme.gov.au/

 

[ReturnToZero]

I stand by my belief that precious metals or shares in mining companies will be much better off in the future that cash in the bank earning interest. Very much so.

No one is disagreeing with you. But to buy your $1800 1 ounce of gold, or your $2000 share in a mining company means you need to save money every week. To do that, the best way would be to put that money in to a bank account - not under your mattress because you think the banks won't give it back (i.e. too much tin foil).

Saving money in the bank to buy an ounce of gold or $2000 worth of shares is of course logical, I'm talking about people wanting to generate wealth in this economic climate would be foolish to think the best way to do it would be to earn interest in a bank account.

Yeah I agree mate, stuffing it in a bank is no way to generate wealth, but the original guy said that banks aren't safe to store money temporarily as opposed to under the mattress.

The guarantee for under a million bucks comes under review October 2011... I personally hope they remove it, the moral hazard created around this sort of guarantee isn't healthy.

 

[jnkmbx]

people wanting to generate wealth in this economic climate would be foolish to think the best way to do it would be to earn interest in a bank account.

Indeed, it's supplemental at best.

Productivity is the way to go

 

[ReturnToZero]

Deposits are guaranteed up to a million.

Please forgive me if I am wrong, but as far as I understand it, this guarantee is to be eliminated on 12th October 2011, and may or may not be replaced with a new guarantee of possibly significantly lower amount. If it is not replaced, then any amounts on deposit are going to be subject to the bank keeping it's doors open - something I feel is not necessarily a given in the economic times we're experiencing.

http://www.guaranteescheme.gov.au/

100% right mate.. Trust me I'm as paranoid as you are, housing market is worrying me the most.

Anyway, way off topic lol.

 

[Still Ballin]

Still Ballin suggested that high interest savings accounts might not be safe for fiat, I disagree - in the bank it is guaranteed and you get a rate of return. Under your mattress the rate of return is 0 and your kid might nick it for booze.

If the purchasing power of fiat falls lets say 30% against gold/silver and you instead had that money in the bank and made 6% in interest, you lost 24%. The way I look at things its not gold/siver going up and down, its the purchasing power of fiat going up and down against silver/gold.

but the original guy said that banks aren't safe to store money temporarily as opposed to under the mattress.

I never said that storing money temporarily in the bank was bad or to store cash under the mattress, what I'm saying is that I wouldn't place my money in a high interest account as a long term investment.

 

[ReturnToZero]

Still Ballin suggested that high interest savings accounts might not be safe for fiat, I disagree - in the bank it is guaranteed and you get a rate of return. Under your mattress the rate of return is 0 and your kid might nick it for booze.

If the purchasing power of fiat falls lets say 30% against gold/silver and you instead had that money in the bank and made 6% in interest, you lost 24%. The way I look at things its not gold/siver going up and down, its the purchasing power of fiat going up and down against silver/gold.

but the original guy said that banks aren't safe to store money temporarily as opposed to under the mattress.

I never said that storing money temporarily in the bank was bad or to store cash under the mattress, what I'm saying is that I wouldn't place my money in a high interest account as a long term investment.

I do apologize, my misunderstanding.

 

[Guest]

Still Ballin suggested that high interest savings accounts might not be safe for fiat, I disagree - in the bank it is guaranteed and you get a rate of return. Under your mattress the rate of return is 0 and your kid might nick it for booze.

If the purchasing power of fiat falls lets say 30% against gold/silver and you instead had that money in the bank and made 6% in interest, you lost 24%. The way I look at things its not gold/siver going up and down, its the purchasing power of fiat going up and down against silver/gold.

but the original guy said that banks aren't safe to store money temporarily as opposed to under the mattress.

I never said that storing money temporarily in the bank was bad or to store cash under the mattress, what I'm saying is that I wouldn't place my money in a high interest account as a long term investment.

I do apologize, my misunderstanding.

We were all agreeing with each other all along here lol

 

[ReturnToZero]

If the purchasing power of fiat falls lets say 30% against gold/silver and you instead had that money in the bank and made 6% in interest, you lost 24%. The way I look at things its not gold/siver going up and down, its the purchasing power of fiat going up and down against silver/gold.



I never said that storing money temporarily in the bank was bad or to store cash under the mattress, what I'm saying is that I wouldn't place my money in a high interest account as a long term investment.

I do apologize, my misunderstanding.

We were all agreeing with each other all along here lol

[youtube]http://www.youtube.com/watch?v=zJv5qLsLYoo[/youtube]

 

[Haggai 2:8]

So cyclone, have you made a decision?

 

[2eyedcyclone]

So cyclone, have you made a decision?

To be honest, I actually posed the question originally just as an idea, not so much as advise for me!
I have a little silver ticked away and I'm quite happy with where I stand, I was just wondering what everyone else thought.

Thanks all for your input.