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Overcoming Desire, Part II

My brother bought a motorcycle this past weekend (a black 1992 Honda Night Hawk 750cc) and after seeing him and my uncle riding together I suddenly had a huge desire to own a motorcycle. But this isn’t the first time I’ve wanted to buy a motorcycle.

Last year when I got my motorcycle license I had planned on buying a bike shortly there after. I rode my brother-in-law’s Honda CBR600RR a few times and went to a couple of Harley Davidson demo rides to compare sports bikes with the Harley’s. I decided the Harley’s were much nicer for long rides and since I expected to be doing a lot of riding, a Harley made the most sense. I quickly found the bike I liked the most: a 2008 HD 1200XL Sportster Nightster:

Harley Davidson Sportster Nightster

It’s about $9,500 new, which isn’t that bad for such a nice bike. However, due to financial constraints, I simply couldn’t afford it at the time. I was still going through a bankruptcy and my bank accounts were empty. It was clearly more of a want than a need and even if I decided to buy one, I didn’t have the money and I wouldn’t be approved for financing. That made it pretty easy to dismiss the desire and bury it for future reconsideration.

After seeing my brother’s bike this past weekend, the desire was unearthed and I found myself again wondering how I could buy a motorcycle. But I ran into the same problem: with my tight financial position it’s hard to justify spending any amount of money on something that I only want and don’t actually need. That’s when I began subconsciously looking for ways to justify buying it: “I’ll save money on gas!”, “I’ll save money on insurance!”, “I’ll be able to enjoy the open air!”, “I can sell my truck and worry about winter and snow when it comes!”, etc, etc. Inside, I knew I was trying to justify the desire for something that wasn’t needed and I heard a tiny part of me quietly rebelling.

I felt a sense of déjà vu as I observed myself doing this and that’s when I remembered going through the same exact same process of overcoming desire a few years earlier (in fact, almost exactly three years ago) when I wanted to sell my truck and buy a Jeep Wrangler. That got me thinking… what the hell would I really do with a motorcycle when the ground looks like this:

During the winter months, there would be absolutely no way to use the motorcycle and I’d need to spend more money storing it (or risk spending money on maintenance in the spring). I started thinking about the goals I set for this year and the things I’ve already decided I really want to do, all of which will require money: complete the AFF program, learn scuba diving (classes, gear, etc), spend lots of weekends camping (commuting gas money), plane tickets to fly to various fitness events, and of course simply saving some money!

It really comes down to priorities. When I stopped thinking about how cool it would be to ride around on a motorcycle and I started thinking about what my priorities were, overcoming the desire for a motorcycle became easier and easier. The motorcycle simply didn’t fit anywhere within my priorities! This didn’t obliterate the desire, but at least now I feel like I’m thinking more rationally.

“Maybe I can find a cheap $3,000 motorcycle that I won’t be so worried about spending money on maintenance and that I would feel comfortable tinkering with (great learning experience!).” “Maybe if I find a good deal, I can resell it before winter.” Suddenly my approach seems more practical and I don’t feel this urge to just go out and spend money.

Three years ago, when I almost sold my truck a splurged on a Jeep Wrangler, my truck had 133,000 miles on it. Now it’s got 190,000 miles and I’ve had it for 4 years 8 months. Here’s to another 110,000 miles of overcoming unnecessary desires. :)

Taking Apart the $819 billion Stimulus Package

The Washington Post has a great graphical breakdown of the $819 billion stimulus package. I’d like to know what they plan to do if this stimulus package doesn’t actually stimulate the economy.

Minty Mints

I came across an impressive self-hosted web site analytics program called Mint (haveamint.com). It’s $30, but for those with privacy concerns it looks like an awesome alternative to Google Analytics. The site’s color scheme (and of course the name) reminded me of another popular web app that allows you to manage your personal finances online: Mint (mint.com). I’m a bit skeptical about giving a 3rd-party site all my bank account information, but it appears to have been reviewed by some big names, including Forbes, The Wall Street Journal, and the New York Times. The idea of being able to easily access all my spending and budgeting info online is compelling, but I’m still debating with myself the security/privacy issues.

Think of debt payments as an investment

Think of debt payments as an investment. When you make a $100 payment on a loan with a 13% interest rate, your annual return is 13%, or $13. Why? Because you avoid having to pay that extra $13 in the future, which leaves you $13 more than you would have otherwise had.

Mortgage Lender IndyMac Seized by the US Government

I was shocked to see news that IndyMac, the holder of the mortgage for my second property (Bowers St), had been seized by US regulators. The mortgage for that property went to foreclosure back in March (my first foreclosure), so needless to say, I contributed to their downfall.

IndyMac’s fate was sealed after Senator Charles E. Schumer wrote a letter about the bank. Mr. Schumer spoke strongly about the agency:

“IndyMac’s troubles, like Countrywide’s were caused by practices that began and persisted over the last several years,” he said. “If O.T.S. had done its job as regulator and not let IndyMac’s poor and loose lending practices continue, we wouldn’t be where we are today.”

IndyMac held $32 billion in assets and its demise is being called the biggest failure in 24 years. In addition to loans, IndyMac Bank held one of the largest savings in the country. The FDIC said nearly $1 billion of the $19 billion in deposits held by IndyMac were uninsured, affecting about 10,000 people. When news got out that IndyMac was in trouble, people started taking their money out of their bank accounts, to the tune of $100 million per day. Things like this are exactly why I feel uneasy saving money at all. It feels safer to invest in things that are real, be it a car, motorcycle, boat, education, health, general experience, or yes, even real estate.

Coupled with the craziness that happened to Fannie and Freddie yesterday, the reality of what’s happening in the US is finally starting to sink in. Fannie and Freddie, which own or guarantee almost half the $12 trillion of home loans in the U.S., plunged as much as 49 percent and 51 percent yesterday. [1] Think about that for a second: half of all the home loans in the U.S. This happened as investors feared failure in the market would cause the U.S. government to rescue both companies, which would wipe out the shareholders.

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