Yeah, mortgages and vehicle loans are a high score value as it shows you can handle large, long-term debt.
I can't even convince myself to redo my 60+ year old kitchen. I don't spend a lot of time in there, it still serves its purpose, so I'm not getting on that train. Would it be nice to have better looking cabinets, and counters that I don't have to keep re-gluing the covering? Sure, but I just don't see the the value in it for my circumstances.
1. Pay cash or if using a card pay it off monthly - that way I get the points. I use a credit union card for cash back. 2. Have a home equity line of credit for emergencies. Don't tap the long term savings (401K, IRA, etc) 3. No debt especially cards or vehicles. 4. 6 months cash available at all time. 5. Maintain everything regardless of how hard it is. Maintenance costs are always less than emergency repairs. I have never been a big fan of 401K's, they give a false sense of security. Anytime money is taken out 20% goes to taxes. I like Roth's except they cannot be opened anymore. If you have one dump money there, after meeting requirements free to take out. And the funny money fund. I never spend change. It goes in a piggy bank and that is how I fund my vacations. Even in a mostly cashless society using cash gives me a chance to save a few cents here and there. Oh granite - love it. Easy to clean, durable, lasts forever and never have to use a hotpad. But then I installed it myself. Don't like paying contractors. My car is just shy of 250,000 miles and is a 2005. My truck has 125,000 miles and is a 1990. Not worth much but I have spent less on them over their lifespan than I would with new vehicles. I have a spreadsheet with all vehicle expenses and the truck cost less than $12,000 and repairs over the last 33 years totaled another $12,000. Cost per mile is about 6 cents. Car is closer to 10 cents but still a lot cheaper than replacing it on a regular basis
Everyone situation is different. Inflation is making it hard on most everyone to do what they want to do. There's a lot of attempting to keep up with the Joneses. That's a slippery slope.
It is true that one shouldn't use a 401k as an emergency fund. You can take out money tax free if you pay it back within a certain time frame (6 months maybe 1 year). Some employers allow you to borrow against a 401k and then it is paid back thru your contributions (I know it is more complicated, but I don't care enough to research). There may also be other methods. 401ls are meant as retirement funds. Then when you start withdrawing you are only taxed at your income level. For most people, their income goes down during retirement, so they actually pay less taxes. Also, everything you put in is tax free, so it reduces your tax liability while you are working. Also, many, if not most employers contribute a percentage to 401ks too so that is "free" money. A Roth you've already paid taxes on. And that is at the (most likely) higher rate of while you are employed. Where I'm at, I have both options. The majority goes into the 401k since as a singalperson without any tax deductions, I pay max Fed taxes - this is my tax shelter. Then a small portion goes into the Roth.
