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Sometimes it's lonely at the top

Posted Dec 31 2007, 05:09 PM by Karen Datko
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Popular MSN Money and New York Times columnist MP Dunleavey got a heap of criticism after she and her husband bought a house that seemed more than they could readily afford. Dunleavey's recent explanation at MSN Money has not silenced all of her critics. This appears to be the price you pay when you live your financial life out in the open.

In a nutshell, Dunleavey wrote, "our crazy financial leap of faith has yielded many blessings: a proper home, an office for me, space for guests (key when you live far from friends and family), plus a new direction for my husband and no more weekends at Lowe's!" Personal-finance blogger Escape Brooklyn didn't accept that explanation. She wrote, "It's disappointing to read elaborate justifications of why it's OK to live beyond your means because of the happiness factor." (For a detailed account of how Escape Brooklyn spent her money in 2007, click here.)

Boston Gal at Boston Gal's Open Wallet attempted to dissect Dunleavey's explanation point by point. For instance: "She says buying the new house saves them $5,000 a year in repairs on her old 'money pit' house. But she still owns the money pit! Just because you have a renter living in the house does not mean you stop maintaining a property!" We're not sure if all of BG's assumptions are correct, but she argues that Dunleavey is skating on thin ice.

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Comments

 

Pls stop dissecting Dunleavey's explanation. You're all jealous. She knows what she's doing and I agree.

Bing (Posted 12.31.07 7:00 PM ) Report Abuse

SOUNDS LIKE A POLITICIAN TO ME!

T-MAN (Posted 01.01.08 12:58 PM ) Report Abuse

This whole argument is silly. Ms Dunleavy is stretching her budget while owning multiple homes because she CAN!  Commenters act like it's some kind of crime that her hubby will go back to work part time to support the purchase decisions they made. As a family they made a decision and as a family they can afford it.  I am not sure why everyone is getting so spun up over this. All of the financial facts have not been presented, so there are a ton of assumptions flying around the boards.

brit in the black (Posted 01.01.08 3:22 PM ) Report Abuse

all i can tell ms. dunleavy is: 'physician, heal thyself.' i would definitely not seek financial advice from an impulsively spending columnist any more than i would seek weight loss guidance from an overweight doctor.

- s.b.

some body (Posted 01.02.08 12:07 PM ) Report Abuse

She thinks the market is down enough that she couldn't sell her current house, but she was crazy enough to get into a bidding war on another house? Warped reality. Why not wait another year when the market has come down more? Pretty much everyone is forecasting that 2008 will be another down year for real estate. Sorry, Ms. Dunleavey, but I wouldn't trust you for financial advice either.

ericabiz (Posted 01.03.08 5:56 PM ) Report Abuse

I've always considered MP Dunleavy more of a novice and an entertainer than a real personal finance adviser. Same with Boston Gal and Escape Brooklyn. They're opinion writers. I wouldn't look to any of them for financial advice, just for a good read from time to time.

Moomah (Posted 01.04.08 9:50 AM ) Report Abuse

I believe a while back, Ms. Dunleavey disclosed that she was up to her eyeballs in credit card debt.  Its hard to take financial advice from someone who seems to keep making mistakes like this.

freddie123 (Posted 01.04.08 10:22 AM ) Report Abuse

The bidding war is irrelevant. The seller simply priced it low to generate interest. Let's all agree that buying a house after prices have tumbled 12%-20% is reasonable. And not selling the first house while waiting for prices to climb is only foolish if the buyer can't hold the carrying costs (interest payments + upkeep - rental income after tax). If she can manage, then this is simply an investment in real estate, plus some extra part-time work for her husband. It might be slightly riskier than most are comfortable with (investments are a personal choice) but foolish it is not.

Joel (Posted 01.04.08 12:06 PM ) Report Abuse

@ brit in the black:   I think people are getting spun up because she is stretching her budget to own two homes because she "WANTS TO", not because she "CAN".  There's a subtle difference there.  Making major financial decisions because of "WANTS" is exactly what pf writers preach against, so it would seem it is a pretty major case of hypocrisy on her part.

It's pretty clear from Dunleavey's "explanation" that the purchase was rather impulsive.  Not only did her family delay their debt repayment goal just to purchase the house, they entered into a bidding war and paid $15k extra just because they wanted *that* house instead of another.  That would be the definition of impulsive and "at odds" with personal finance advice she's doled out in the past.  It's clear from her explanation how painfully difficult it was to come up with reasons for the purchase besides "We wanted that house."

No one is perfect and people compromise their supposed "principles" all the time.  Because she is in the public eye as a personal finance writer though, she is stuck living with the consequences of her actions.  Her readers will question her advice, her financial acumen, and her integrity.  

"Do as I say, not as I do," is not an acceptable response from religious leaders, politicians, and, now apparently, personal finance writers.

Toby (Posted 01.04.08 12:19 PM ) Report Abuse

Point one she's 41 years old and has $16k saved for retirement.  Um, she's unable to fund her Roth IRAs this year because of the purchase.  Second, she still had $6500 of CC debt because she bought the house.  Not a smart move.  Third, she has $5k EF, think that's enough to weather any issues with the rental? I bet not.  One major accident, no renter for 3 months and they'd be SOL.

Livingalmostlarge (Posted 01.04.08 11:35 PM ) Report Abuse

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