Have you personally benefited from the Great Resignation/low unemployment?

[PandaBear]

I think you're just referring to California. If you follow the 4% rule, that 2 million works out to 80k a year. The 4% rule basically says that if you withdraw 4% a year and invest the rest of the money, it should last the rest of your life as investment returns have averaged 8-10% over the long term. Doesn't go far in CA, but there's a reason certain states are popular for retirees, much lower cost of living. Lots of retirees also become expats and live in other countries where cost of living is even lower. Of course with inflation, that might not hold for long.

Seniors cannot play the long game. Heck, most of the BITOG prognostigators have a huge equity market crash comming, right?
But if you are 65, have housing under control, have $2M and play your cards right, you should be OK.
FYI we are talking about very few people. The median net worth of Americans over 65 is about $260K.

Another way to look at it is, around a third of the US wealth (31.4%) is owned by the top 1%, which is almost 16 times more than the bottom 50% who own 2% of it.

Please don't wait until you are older to start saving! Get scared people! Invest in yourself!

In theory, we all want to have just enough money so we are done spending our last penny when we die. In practice this means half the people will likely die on the street homeless and the other half with left over money in the bank.

I'd err on the side of being safe and make sure the return on investment of my asset is increasing above inflation + living expense, rather than withdrawing 4% a year. All it take is one wipe out event and retiree can be wipe out with nothing to fall back to, don't be that guy.

 

[Wolf359]

In theory, we all want to have just enough money so we are done spending our last penny when we die. In practice this means half the people will likely die on the street homeless and the other half with left over money in the bank.

I'd err on the side of being safe and make sure the return on investment of my asset is increasing above inflation + living expense, rather than withdrawing 4% a year. All it take is one wipe out event and retiree can be wipe out with nothing to fall back to, don't be that guy.

I believe 4% is considered a safe withdrawal amount and that should allow the balance to grow not shrink. But of course that was when inflation was in the 2-3% range.

 

[philipp10]

I disagree.
I said it hurts everyone even the rich and it is a no brainer that it hurts the working poor.
Of course, it does, that need not even be said.
For high income it hurts as well because high energy raises the price of everything.

Now if you qualify rich as over $100 million a year income than maybe not.
The working rich tend to be in debt at the same ratio as the average Joe.
Define rich.

If high oil prices hurt the rich, they are NOT rich. Most rich people are invested in the stock market and specifically in energy stocks. So while high oil prices might hurt a certain segment of the market, they are getting good returns from their Exxons and Chevrons. The rich, at least in the last 20 plus years have only goten richer and that will continue as inflation hurts the poor not the rich.

 

[Wolf359]

If high oil prices hurt the rich, they are NOT rich. Most rich people are invested in the stock market and specifically in energy stocks. So while high oil prices might hurt a certain segment of the market, they are getting good returns from their Exxons and Chevrons. The rich, at least in the last 20 plus years have only goten richer and that will continue as inflation hurts the poor not the rich.

This got debated half a thread ago.

Have you personally benefited from the Great Resignation/low unemployment?

My wife is upper management in a Boston area healthcare company and has received extra bonuses for continued work throughout the pandemic. Imagine that - a bonus for actually going to work?!?! I like my current job, but have started interviewing for positions with MIT and several Boston biotech...

bobistheoilguy.com

 

[JeffKeryk]

If high oil prices hurt the rich, they are NOT rich. Most rich people are invested in the stock market and specifically in energy stocks. So while high oil prices might hurt a certain segment of the market, they are getting good returns from their Exxons and Chevrons. The rich, at least in the last 20 plus years have only goten richer and that will continue as inflation hurts the poor not the rich.

Well, it definitely hurts some more than others.

 

[PandaBear]

If high oil prices hurt the rich, they are NOT rich. Most rich people are invested in the stock market and specifically in energy stocks. So while high oil prices might hurt a certain segment of the market, they are getting good returns from their Exxons and Chevrons. The rich, at least in the last 20 plus years have only goten richer and that will continue as inflation hurts the poor not the rich.

I understand this about 10 years ago:

A lot of oil wealth is invested into asset market (stocks, real estate, bonds, USD, etc) and the higher the oil price the more of the profits are invested, and when the oil price dropped the oil money had to withdraw to cover their own downturn, pay their own sovereign expenses, subsidize production to do price wars, etc.

So asset prices correlate to oil price and therefore oil price going up doesn't hurt rich people as much, as they have more gain from their investment despite more expenses. Poor people usually have more income from paycheck and less from investment.

 

[Jarlaxle]

Tough business I concur. My sisters in law operates only in cash in VT food truck(converted Uhaul)/one location no borrowing and has thrived getting free equipment from closed restaurants. Also another filler was making healthy and tasty homeless meals at $10/item X 1000 in the downtimes. Cost is $2/meal and this is weekly. She and her partner are so savvy. I think looking outside your box is key to survive and thrive.

My cousins made the mistake of trying to save the duplex they had poured $70,000 and years of work into...but not seeing a penny in rent for 20 months pretty much ruined them. They'd have been better off had they just walked away when their tenants stopped paying rent in summer of 2020...or torching the place.

 

[Dave Hess]

My cousins made the mistake of trying to save the duplex they had poured $70,000 and years of work into...but not seeing a penny in rent for 20 months pretty much ruined them. They'd have been better off had they just walked away when their tenants stopped paying rent in summer of 2020...or torching the place.

Rent moratoriums killed lots of mom and pop landlords. I went to the CDC website to read up on the moratorium paperwork, all the tenants needed to do was sign a 2 page paperwork (saying they were affect by Covid) printed from website to screw their landlord. Extremely sad and unfortunate the government could pick winners like big box retailers…… and the losers like small businesses being forced to close and no rent for landlords.

Even if they tried to evict the court systems throughout the USA are so backed up its a 6 month wait for case to be heard. Lots of people were getting unemployment from their state plus the $600 a week from government + stimulus checks and not pay a penny in rent. I know some states kept extending the rent moratoriums.

I tell lots of people to never ever put your financial success in the hands of compete strangers and deal with the problems and debt of a landlord. Clicking a mouse and buying high quality stocks and ETFs is a lot safer and less stressful. Want monthly income then buy a mix of dividend paying stocks.

I know a few landlords and some are now desperate to sell their properties.

 

[ekrampitzjr]

Rent moratoriums killed lots of mom and pop landlords. I went to the CDC website to read up on the moratorium paperwork, all the tenants needed to do was sign a 2 page paperwork (saying they were affect by Covid) printed from website to screw their landlord. Extremely sad and unfortunate the government could pick winners like big box retailers…… and the losers like small businesses being forced to close and no rent for landlords.

Even if they tried to evict the court systems throughout the USA are so backed up its a 6 month wait for case to be heard. Lots of people were getting unemployment from their state plus the $600 a week from government + stimulus checks and not pay a penny in rent. I know some states kept extending the rent moratoriums.

I tell lots of people to never ever put your financial success in the hands of compete strangers and deal with the problems and debt of a landlord. Clicking a mouse and buying high quality stocks and ETFs is a lot safer and less stressful. Want monthly income then buy a mix of dividend paying stocks.

I know a few landlords and some are now desperate to sell their properties.

When it comes to benefitting from the Great Resignation and low unemployment, small landlords are out in the cold. Shills such as Del Walmsley are still plugging rental housing as the best investment for becoming rich, even in this environment, while ignoring or poking fun at the real problems with tenants not paying because of rent moratoriums. Walmsley says to concentrate on the class A rental properties with wealthy tenants. Easy to say when you have money. Not so easy for mom and pop in this environment.

Right now the best situation is the one many posters here (including me) are in, which is to have a good job with an employer who wants to keep you and make you happy. Investing mostly looks bad right now no matter what type you consider.

 

[philipp10]

Rent moratoriums killed lots of mom and pop landlords. I went to the CDC website to read up on the moratorium paperwork, all the tenants needed to do was sign a 2 page paperwork (saying they were affect by Covid) printed from website to screw their landlord. Extremely sad and unfortunate the government could pick winners like big box retailers…… and the losers like small businesses being forced to close and no rent for landlords.

Even if they tried to evict the court systems throughout the USA are so backed up its a 6 month wait for case to be heard. Lots of people were getting unemployment from their state plus the $600 a week from government + stimulus checks and not pay a penny in rent. I know some states kept extending the rent moratoriums.

I tell lots of people to never ever put your financial success in the hands of compete strangers and deal with the problems and debt of a landlord. Clicking a mouse and buying high quality stocks and ETFs is a lot safer and less stressful. Want monthly income then buy a mix of dividend paying stocks.

I know a few landlords and some are now desperate to sell their properties.

Totally agree. I owned rental property WAY back and these last two years told me nope, not a chance I would do it again. How absurd the government screwed over the landlord, as if they are all rich. In Minnesota, we now have in St. Paul a new rent control ordinance, rents rises are capped at 3% per year. It's already had an effect, some developers pulled out of projects. The government is treating everyone like babies now.

 

[Jarlaxle]

Totally agree. I owned rental property WAY back and these last two years told me nope, not a chance I would do it again. How absurd the government screwed over the landlord, as if they are all rich. In Minnesota, we now have in St. Paul a new rent control ordinance, rents rises are capped at 3% per year. It's already had an effect, some developers pulled out of projects. The government is treating everyone like babies now.

Well...St. Paul is doomed.

 

[eljefino]

Those that I touched a nerve on, this thing of parents giving their adult kids thousands of dollars a year is fairly new. I always see the same sentences in response to this - "early inheritance", tax breaks, future college funds for grandkids, etc.

I'm not sure I've heard of all this prior to several years ago.

Whatever....

There's always a chance that a parent might wind up in a state-funded nursing home, which can wipe out half a million bucks pretty quickly. And they can "claw back" a few years' worth of gifts. Giving the kids a little bit of inheritance early, if the kids are mature enough to handle it, is a form of diversification.

 

[JeffKeryk]

There's always a chance that a parent might wind up in a state-funded nursing home, which can wipe out half a million bucks pretty quickly. And they can "claw back" a few years' worth of gifts. Giving the kids a little bit of inheritance early, if the kids are mature enough to handle it, is a form of diversification.

My Mother taught me, "Don't wait to help someone until you are gone, because it might be too late."
It is a wonderful feeling to touch someone's life when they are in serious need.

 

[methusaleh]

Tough business I concur. My sisters in law operates only in cash in VT food truck(converted Uhaul)/one location no borrowing and has thrived getting free equipment from closed restaurants. Also another filler was making healthy and tasty homeless meals at $10/item X 1000 in the downtimes. Cost is $2/meal and this is weekly. She and her partner are so savvy. I think looking outside your box is key to survive and thrive.

Ha, pretty sure your SIL is good friends with my wife, it’s a small world! The Vermont Everyone Eats program is still funded through April I believe.

 

[alarmguy]

Those that I touched a nerve on, this thing of parents giving their adult kids thousands of dollars a year is fairly new. I always see the same sentences in response to this - "early inheritance", tax breaks, future college funds for grandkids, etc.

I'm not sure I've heard of all this prior to several years ago.

Whatever....

Its been around forever.
Parents shed wealth in their bank accounts to prevent government from draining their life savings "in case" of a worst case scenario.
They can gift $15,000 to each child and an additional $15,000 to each spouse of the child and $15,000 to every grandchild every year without having to report it to the IRS. It used to be $10,000.
However, medicare CAN look back up to face years and deny you nursing home care.

Making Gifts: The $10,000 Rule

One simple way you can reduce estate taxes or shelter assets in order to achieve Medicaid eligibility is to give some or all of your estate to your children (or anyone else) during their lives in the form of gifts. Certain rules apply, however. There is no actual limit on how much you may give […]

mortonelderlaw.com

Im not a tax expert, for conversation only )