> I started the year with almost nothing and ended with a used van, a new utility trailer, less debt, fully paid bills and money left to take the family to Hawaii.
More context. Paid cash for the van and the utility trailer. Paid off a good chunk of debt on top of those big purchases and didn't use credit at all this past year.
Hawaii: We used to live here, and have spent the past few years saving for this trip. We came to see friends that we haven't seen in 4 years. They are meeting two of our children for the first time. Airfare: $400/ticket round trip purchased months ago at the lowest price of the year. Van: Our friends are letting us use their van for free for all 16 days. We are staying at three friends houses while we are here, also free. Our expenses while here are food and gas. Everything else we are doing here is free, surfing, swimming, snorkeling, hiking, going to the lava etc. The entire trip is costing us less than $2,500 for our family of 6 to fly to Hawaii and spend 16 days with our friends. I've saved money money on just about everything. I'm not sure it's possible for this trip to have cost any less than it has. We valued this trip over paying off a chunk of our debt for many reasons. Having money and being debt free is important to us, but recognizing that being debt free is a few more years out, we saved and paid cash for the trip. The rest, sunshine, body boarding and time with friends is worth a lot more to us than the money.
Why should it be your highest priority? As long as you're not in over your head and are paying it off on schedule, all you lose is a little future money to interest payments. If what you get by not paying it off faster is sufficiently valuable to you, it might very well be a good bargain.
I mean, do you really think that as soon as you buy a house (which pretty much anyone not absurdly rich — and many who are — will take on debt to do), you must immediately neglect your family and pursue money at all costs? That hardly seems like a tenable position. People who have grave problems with debt have those problems not because debt is inherently a grave problem, but because they took on debt they couldn't handle.
Your absolutely correct that we all have different perceptions of "extravagance"
I think a vacation to hawaii from portland for a family of four while still in debt is clearly extravagant, and unaffordable. But's thats just my opinion, and I dont expect you, or anyone else, to share it.
Debt shouldn't be seen as ok to have but I think that is sadly how most Americans view it now.
Depends on whether the Portland in question is in Maine or Oregon, and whether the trip was an extravagant package or little more than a cheap-deal flight and minimal accommodations. At a glance http://www.cheapflights.com/flights-to-hawaii/portland-OR/ shows a flight package of $1548 for 4. Camping, hostels, or - here's a thought - Craigslist might open some cheap options.
The problem isn't debt but debts that aren't paid back. Debt itself serves a useful purpose. As long as he's able to service his debts under the terms agreed upon, the rest of his money is his to use as he pleases. I don't think we know enough about his finances, like the cost of the trip, to be able to say that the trip was clearly unaffordable.
If someone pays their debts according to the pre-agreed schedule (e.g. meets the mortgage payment every month), there's absolutely no reason to make moral judgments on how they spend the rest of their cash.
I think you're being a bit harsh and missing something here. Creating a wonderful vacation and memories for your family is priceless. And as seems to be the case, he is paying off his debt on a schedule and is not over his head. I'm pretty happy for him.
It might not be the most logical thing to do, but it's not like it's necessarily an immoral thing to do (as "Let's rephrase your statement: 'Paying back on things you've already purchased...'" implies).
It's one thing if the money is borrowed from a friend or family member (as a charity or with extremely below market interest rates). But the 2.43 trillion dollars of debt that you cite is almost entirely with institutions which make a profit off of debt. [not bashing creditors]
It probably isn't even illogical. He makes money in a way that heavily depends on him--his morale and how much work he is willing to put in. I would not be surprised if going on a vacation actually motivated him enough to be a good deal from even a purely fiscal perspective.
Oh yeah, I can totally see that being the case as well. I almost shared a story in my last comment about a guy I knew who, though constantly struggling to stay afloat (most likely below poverty with a wife and three kids), would do his best to buy something nice for his wife (something small, but thoughtful) and sometimes rent a movie that they could all watch when he got home from work.
My dad pointed out "Your family's wellbeing includes their morale."
Either way, only Ryan (and possibly his accountant [probably his wife]) can make that call.
I have a mortgage, yet go on vacation and buy nice stuff. Debt is OK if used wisely, paid wisely, and does not impose economic jeopardy (i.e.: net assets vs. net debt).
Maybe he was given the trip to Hawaii for free or got it at an amazing deal, plus he said he's doing deals in Hawaii on vacation so he'll probably have a good portion of the trip paid of from his working vacation. Plus you can't measure the boost in happiness and a new perspective of the world that this trip to Hawaii will have on his business.
He might see ideas and get new perspectives on things while on vacation in a new land that he otherwise would not get while at home in work only mentality.
> less debt > family to hawaii
Something does not compute here.