It’s not!!??
Well, rats, there goes my retirement plan, then…
I was planning on spending my retirement on a mountain, contemplating life, sitting on the chair lift, between runs…
Oh, wait, not exactly the same thing.
I sold all my stocks and bonds today.
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Well, rats, there goes my retirement plan, then…
I was planning on spending my retirement on a mountain, contemplating life, sitting on the chair lift, between runs…
Oh, wait, not exactly the same thing.
I mean compared to what the teachings for us boomers were. You guys know what I meant. You are not going to find it in 7 ATVs, loose women or a bottle of any kindIt’s not!!??
Well, rats, there goes my retirement plan, then…
I was planning on spending my retirement on a mountain, contemplating life, sitting on the chair lift, between runs…
Oh, wait, not exactly the same thing.
My youngest daughter said something years ago. You don’t get rich by chasing money
Because shorting has a limited and finite potential upside and unlimited potential downside.
Its as likely that you will be on the sidelines and miss out on 50% or 100%.
Timing the market just doesn't work on any repeatable or methodical basis.
Or, Like this? From the great movie The Bucket ListIt’s not!!??
Well, rats, there goes my retirement plan, then…
I was planning on spending my retirement on a mountain, contemplating life, sitting on the chair lift, between runs…
Oh, wait, not exactly the same thing.
Ash remains on the mountain
But maybe if you chase guys with money
1. Foolishness, and bad money decisions, are not confined to one generation, or one profession.
2. Tech is getting beat up, sure, but it’s also been on a tear, with crazy gains.
3. If you have a reasonable allocation across sectors, you enjoyed the ride up in part of your portfolio, and this correction isn’t killing you.
4. Bonds were a terrible place for your money, and lost money, in some cases, over the past decade. When interest rates rise, as they have recently, bonds fall. Not “safer”, just a different vehicle, with different results, to accomplish your ultimate goals, but again, the asset allocation matters. A one year return of 11% in a bond fund is an anomaly.
If you bought into tech recently, on FOMO, then, yeah, you’re getting beat up, but that’s a function of 1. Above…
Interest rates had already risen as far as they were going to. They cost other people a lot of money, not me.
I actually do have a deeper understanding of what's going on in the tech industry right now than the average "investor" that is hoping "AI" will mean money. Long run, it won't. These models can't be fixed. They give people basic information that is very wrong, and you know, they all have disclaimers that you shouldn't trust anything that it gives as output.
There's no world in which they'll ever write basic code as well as a human. It prints a lot of garbage to the screen and in some data center, it's losing someone a lot of money to do that with.
Currency arbitrage within investments has often returned me more money than the assets themselves.
Saying "buy an ETF and hold it" is very basic advice, maybe fit for a person who doesn't know what they're doing. It relies on the assumption that over 40-50 years you'll make money if the market performs like it has.
However, many people see their investments crash and respond emotionally by withdrawing them to something else, making the loss "real" and missing the bounce back. I prefer stocks when a bunch of people did that recently. Things tend to correct too far.
My mom has a friend who says "she lost $500,000 in 2008". I said, "Well, then she's a crappy emotional investor."
Many people just make terrible financial decisions in general. Like losing $40,000 on a new car every 5 years. I have mixed feelings about Dave Ramsey but when he said that anything on wheels loses value like crazy, he's right. "That's why they say 'like a rock'".
Where do you think all these people who owe 20-30-40% more than their car is worth came from? It wasn't a Harvard economics school.
This economic bubble we're in is going to be radically destructive in ways the dotcom crash wasn't. While the dotcom crash produced a lot of waste, it also laid the foundation and skill sets and infrastructure to reshape our economy. Even when networking equipment and computers went on bankruptcy sales, there were tangible assets. This time, hardly anything of value will survive.
What "firepower" does the Fed have to respond with when anything they respond with will be extremely inflationary? They started to lower interest rates a bit last year, and inflation spiked right away even before the cuts had much time to phase in. Is the Fed to set a new inflation target of 6 or 7% every year to avoid a correction in the stock market?
Personally, on a surface level, it seems the people running the Fed and the Treasury have either lost their minds or the IQs have dropped sharply lately, of course the cynic in me wants to say they know exactly what they're doing to most of us, and they don't care.
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Since a worker's output for the week has 15.3% delegated to helping a retiree that very same week it bugs me a bit that those remaining employed, around a top-heavy retiree census, are asked to shoulder more of the burden.
Remember, you can't save labor output for a generation. Social Security reflects that. The closest thing you can do is build very durable goods, like infrastructure, that might last 100 years, and last through any future labor shortages.
It deeply saddened me to see those 90 year old cart pusher stories.
You need to be making some sacrifices now and hammering those retirement accounts hard and hopefully there will be enough between that and Social Security. Maybe not, but Social Security ain't gonna cut it and probably that's the part everyone agrees on.
Illinois has Secure Choice for employers of 5 people or more and it's basically a Roth account for people who don't have something at work. The federal government had MyRA for a while that invested in Savings Bonds, which was better than nothing, but it wasn't a law so things like that can be scrapped on a whim, and it was.
Illinois penalizes employers who don't at least enroll their employees in Secure Choice or show good cause that the employer is exempt and I agree with that.
If you are in your 30s now and pushing a pallet jack around at Walmart and wondering how feasible that is at 80, the short answer is that it's not and now is the time to be all "Hulk angry! Hulk smash!" Or at least just take the 6% they'll match.
You may even get up to $1,000 a year out of your federal taxes that you never ever have to pay for saving that money. So you put in $4400 a year and it really only took $1200 of your own money, and using traditional savings hels lower your AGI to qualify or increase the percentage of that credit.
Not doing this at the minimum is dumb. The law will change in 2027 to get even more generous because they really want you to save. The Social Security trust fund is not looking good. It's got single digit years left before everyone on it gets a 26% buzz cut unless it's fixed somehow.
It's those low wage workers that need the education about saving whatever you can now and why it hardly costs as much as they think, because even if Social Security pays you 100% of what it says it will, having several hundred thousand dollars sitting in a private account is going to mean that you can keep operating for a while when that's not going to be the case otherwise, while your coworkers who didn't save anything are falling apart and still working because they have to somehow.
Dave Ramsey quipped that people plan to have the government take care of them and as we all know, they're great at managing their own money.
There's probably not going to be a comfortable retirement and sitting around not being concerned about being on a conveyor belt speeding towards the slaughter is a quality I admire in my food.
I've had some fight or flight years and I'm not one to run away or back down. I realize that there's nobody that's going to take charge of our future except us. If Social Security pays us, cool. But I absolutely don't trust them to provide stability and security. Believing they will be there for you may keep you calm, but calm isn't always good.
My natural instinct has been said to border on paranoia at some points in my life, but it has actually served me well several times. I'm basically off the charts as a Machiavellian personality type. So I tend to be highly skeptical of motivations and prone to planning to be backstabbed. Anyway, that's saved me a few times.
The only thing I'd change about our 401(k)s are that they handed them to Bank of America and I'm not terribly thrilled with the investment options there, but you don't have to limit yourself to retirement account investing.
There's some reasons to be aggressive with the 401(k) even if you exceed the match and the options are not the best, like your creditors don't get it if you file bankruptcy at some point. Can't touch a penny. That's worth a lot in my opinion. Nobody knows what will happen that gets a huge hospital bill in their lap. There's just a lot of people out there with a "day by day" mentality and short term thinking to me are five year plans. Like the five year plan to get my spouse to US citizenship (which worked).
A lot of the reason why I haven't touched those Savings Bonds I bought in the 90s and 2000s that are still paying good interest, is also because it's a values statement to me. I look at them and it reminds me about how short a time 30 years is and that I was providing for myself when I was picking up jobs at 13 or 14.
I had a bout in my 20s where I let it all go for a while, but after 0% balance transfer scoop and toss, I got sick of having all that debt around and paid it. It's amazing what stress does to the brain when you're working and studying. You start letting it all hang out somewhere else. Not getting enough sleep, eating odd things in the middle of the night...
I couldn't do that in my 40s. If I don't get 8 hours in my own bed, I'm almost useless. I had to take a trip down to the city and stay in a hotel last year and it was a nice hotel (rooms start at $1,400), but I never sleep well in odd places.
Also, I don't really care about who is in charge of the world or the institutions. If they make me more money I'm all for it, I try never to let my personal feelings get in the way of making money decisions. Right now, I am making financial decisions based on what I see the logical risks are in the market. Uncertainty over what's even going to happen and how it will affect the stock market and corporate earnings are going to be confusing investors because it's hard to plan when you hear things like 25% tax on everything coming in from Canada and Mexico, then the next day it's like "Oh wait, nevermind, messing with you. Disregard. But maybe next month." and they're all threatening to do it to us. That's an investing nightmare is what that is. It's not orderly at all.
There's a lot of volatility and risk right now that makes owning the debts less uncertain. Their stock might be down 20% today but they still owe money on their debt.
I really wish the uncertainty would clear up, honestly. Undermining the USMCA FTA is probably the worst thing for workers and investors. It will have uneven effects on the market and may even be easy for foreign companies to game while not so easy for domestic industry that depends on North American supply lines and integrated markets and manufacturing.
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As has been stated here before...brevity is your nemesis. Edit: In fact, time to hit the ignore button for you. Never saw so much rambling with zero value content here.It deeply saddened me to see those 90 year old cart pusher stories.
You need to be making some sacrifices now and hammering those retirement accounts hard and hopefully there will be enough between that and Social Security. Maybe not, but Social Security ain't gonna cut it and probably that's the part everyone agrees on.
Illinois has Secure Choice for employers of 5 people or more and it's basically a Roth account for people who don't have something at work. The federal government had MyRA for a while that invested in Savings Bonds, which was better than nothing, but it wasn't a law so things like that can be scrapped on a whim, and it was.
Illinois penalizes employers who don't at least enroll their employees in Secure Choice or show good cause that the employer is exempt and I agree with that.
If you are in your 30s now and pushing a pallet jack around at Walmart and wondering how feasible that is at 80, the short answer is that it's not and now is the time to be all "Hulk angry! Hulk smash!" Or at least just take the 6% they'll match.
You may even get up to $1,000 a year out of your federal taxes that you never ever have to pay for saving that money. So you put in $4400 a year and it really only took $1200 of your own money, and using traditional savings hels lower your AGI to qualify or increase the percentage of that credit.
Not doing this at the minimum is dumb. The law will change in 2027 to get even more generous because they really want you to save. The Social Security trust fund is not looking good. It's got single digit years left before everyone on it gets a 26% buzz cut unless it's fixed somehow.
It's those low wage workers that need the education about saving whatever you can now and why it hardly costs as much as they think, because even if Social Security pays you 100% of what it says it will, having several hundred thousand dollars sitting in a private account is going to mean that you can keep operating for a while when that's not going to be the case otherwise, while your coworkers who didn't save anything are falling apart and still working because they have to somehow.
Dave Ramsey quipped that people plan to have the government take care of them and as we all know, they're great at managing their own money.
There's probably not going to be a comfortable retirement and sitting around not being concerned about being on a conveyor belt speeding towards the slaughter is a quality I admire in my food.
I've had some fight or flight years and I'm not one to run away or back down. I realize that there's nobody that's going to take charge of our future except us. If Social Security pays us, cool. But I absolutely don't trust them to provide stability and security. Believing they will be there for you may keep you calm, but calm isn't always good.
My natural instinct has been said to border on paranoia at some points in my life, but it has actually served me well several times. I'm basically off the charts as a Machiavellian personality type. So I tend to be highly skeptical of motivations and prone to planning to be backstabbed. Anyway, that's saved me a few times.
The only thing I'd change about our 401(k)s are that they handed them to Bank of America and I'm not terribly thrilled with the investment options there, but you don't have to limit yourself to retirement account investing.
There's some reasons to be aggressive with the 401(k) even if you exceed the match and the options are not the best, like your creditors don't get it if you file bankruptcy at some point. Can't touch a penny. That's worth a lot in my opinion. Nobody knows what will happen that gets a huge hospital bill in their lap. There's just a lot of people out there with a "day by day" mentality and short term thinking to me are five year plans. Like the five year plan to get my spouse to US citizenship (which worked).
A lot of the reason why I haven't touched those Savings Bonds I bought in the 90s and 2000s that are still paying good interest, is also because it's a values statement to me. I look at them and it reminds me about how short a time 30 years is and that I was providing for myself when I was picking up jobs at 13 or 14.
I had a bout in my 20s where I let it all go for a while, but after 0% balance transfer scoop and toss, I got sick of having all that debt around and paid it. It's amazing what stress does to the brain when you're working and studying. You start letting it all hang out somewhere else. Not getting enough sleep, eating odd things in the middle of the night...
I couldn't do that in my 40s. If I don't get 8 hours in my own bed, I'm almost useless. I had to take a trip down to the city and stay in a hotel last year and it was a nice hotel (rooms start at $1,400), but I never sleep well in odd places.
Also, I don't really care about who is in charge of the world or the institutions. If they make me more money I'm all for it, I try never to let my personal feelings get in the way of making money decisions. Right now, I am making financial decisions based on what I see the logical risks are in the market. Uncertainty over what's even going to happen and how it will affect the stock market and corporate earnings are going to be confusing investors because it's hard to plan when you hear things like 25% tax on everything coming in from Canada and Mexico, then the next day it's like "Oh wait, nevermind, messing with you. Disregard. But maybe next month." and they're all threatening to do it to us. That's an investing nightmare is what that is. It's not orderly at all.
There's a lot of volatility and risk right now that makes owning the debts less uncertain. Their stock might be down 20% today but they still owe money on their debt.
I really wish the uncertainty would clear up, honestly. Undermining the USMCA FTA is probably the worst thing for workers and investors. It will have uneven effects on the market and may even be easy for foreign companies to game while not so easy for domestic industry that depends on North American supply lines and integrated markets and manufacturing.
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Agreed to the part about not leaving your job, and that includes being ready to get up and move if your employer requires you to, which is one way in which owning a house is a liability.
Some people signed 30 year mortgages out in the middle of nowhere figuring they'd be allowed to work remotely forever and that just wasn't true and now 5 years in they have a house that doesn't go with them.
We stayed in the Chicago area right on the commuter rail line. One straight shot for about an hour by rail and you're downtown.
It can be. But I think a lot of what I say needs to be heard, obviously. The high income earners are not going to have a retirement crisis unless it's entirely of their own doing, like choosing not to invest and put aside money for themselves due to lifestyle inflation.
The low income workers face two risks from relying on Social Security. Risk 1 is the Trust Fund going broke in 2031 or so and only paying 74% on an ongoing basis. Might even be less than that. Depends on revenues. Risk 2 is that their Primary Insurance Amount with Social Security is only going to provide them with about $1500 to live on each month, and in most cases you can't even rent an apartment for that anymore due to the fact that landlords are taking advantage of people. So they will need another income to even survive at all.
So even if someone fixes the Trust Fund, they're still going to be in a world of hurt.
In the 2000s, they were talking about partially privatizing Social Security and having individual accounts where workers could direct some of their payroll deductions. It was a terrible idea, people hated it, it was not implemented. Then in the early 2010s, they got this notion that the government would provide a tax incentive for people with modest incomes to encourage them to save.
That only works if you have a low income yet are savvy enough to save instead of wasting your money on taxes (sending it to the IRS when you don't even have to is a waste), and frankly not very many of them are.
I talked to some people who are here from my spouse's country and I showed them the numbers about how much they were giving up by foregoing retirement plan contributions and the employer match, and that low income retirement savers credit (because a lot of them are working at Walmart, many women are), and I showed them how much money they could be losing to taxes (forever) and their retirement (eventually) due to the effects of a simple compound annual growth rate. When they realize how bad they're hurting themselves, many change course, but usually there's nobody explaining it to them, and that's not just immigrants, it's Americans.
My mom got very lucky, she worked at a a Catholic nursing home as an LPN and even though she managed her 403(b) very poorly and the fund manager and the IRS and INDOR (I call the Indiana Department of Revenue that because it makes it sound Star Wars-ey instead of a tax department) made more money on her grabbing into it than she ever did, they made the main benefit of working there a defined benefit pension, and since she wasn't able to raid that, she's drawing an annuity now.
But defined benefit plans have largely gone the way of the dodo and it's literally up to you if you want a retirement now. If she could have raided the pension for plastic surgery and trips to Key West she would have, so I'm glad that she was cut off from her pension until it was time to get it. Otherwise she'd have a couple grand of Social Security and that would be that.
"Edit: In fact, time to hit the ignore button for you. Never saw so much rambling with zero value content here."
You can do that. You did mention that I never helped my mother with good advice. I did tell her to quit reaching into her 403(b) and letting the IRS and the fund manager take about as much as she did over the course of the years on things that were not retirement.
Sometimes it's just not the parents that are the source of wisdom. They always seem to think they are.
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That sentence alone tells most folks all they need to know.
You're conveying your personal experience, which like many, if not all of us, is limited. What you think you've learned from your personal experience may very well be guidance and wisdom to you but it's more likely than not, completely meaningless to others. For every individual posting in this thread, there's a different backstory and current situation.
Established financial planners and wealth managers are not joining BITOG and chiming in here for altruistic advice. Most want to be paid for it.
Everything else, including your input, is just opinions, not Gospel.
It's a shame most of them get paid for it. There's usually two types of "financial advisors".
There's the common sense one that most people in America need to hear because they're broke, like Dave Ramsey (he's a sort of advisor of sorts for people who need to hear ditch the car and pay off your maxed out credit cards), and there's ones that fight against things like the fiduciary responsibility rule when they manage your investments because they don't want a legal requirement to have your interests at heart.
Most people shouldn't need to pay anyone. It's "common" sense to not get into debt, live below your means, and invest in index funds, and pay as little tax as you can legally get away with.
The worst thing that ever happened to fund managers were index funds and roboadvisors.
Anyway, I try to be nice to people. Like telling them how to do things that may not occur to them. When you sit down with a person who works at Walmart and say "You can have $40,000 go to the IRS you'll never see again, that you don't have to pay them, or retire with a million dollars", it sort of turns the gears. Seen it.
You don't understand the difference between a financial advisor and a wealth manager. You shouldn't be giving financial advice to anyone.
How about this?
1. Millions of Americans require some guidance as to how to maximize their earnings and savings for a comfortable retirement.
2. Millions of Americans have accumulated earnings, inheritance(s), perhaps winnings and/or legal monetary settlements. Many of them require financial guidance and expertise beyond a Podcaster to secure and maximize financial growth, minimize tax exposure, estate planning, potential healthcare costs, long term care planning and other life events.
Your overall perspective, at least of personal finance, is very narrow and limited.
You can't seem to grasp that there is not a one size fits all solution.
It's true that people who have never had any real amount of money before should call an expert first.
My cousins got a few million dollars when my aunt died and it was all gone within three years and one of them filed her third bankruptcy.
Nobody wants their mom to die but from the financial side, the inheritance was like the lottery winner's curse. The mistakes are usually seeing the money as a huge windfall and running your mouth instead of silently collecting it and investing.
In their case much of it went to expensive vacations and some vehicles that they don't even have anymore.
If I won the lottery there'd be almost no signs. Nothing would happen that would draw any attention at all. The last thing I would want is that side of the family to know because people who haven't talked to me in years would want me to solve all their problems.
In fact, the two that blew the life insurance money did ask me to pay their $600 Verizon bill and I told them I was broke. For all they knew I am. Got six figures in savings and investments and I didn't get there by paying other people's phone bills and tablet plans.
Outwardly there's no tell that I have much of anything because that's not the signal I want to send to people. But the truth is I earned every single penny of that.
Someday if I'm frail or have to go without income, I'll last for years and years and 80% of America would be in trouble in a week. I don't want to be normal if it means living paycheck to paycheck.
I don't even keep close track of when payday is. Stopped doing that about 5 years ago.
My cousins should be wealthier than I am but they're not.
They had everything in life that I didn't get including parents that loved them and sent them to college. I had to work for everything, much harder than people like them.
I'm not complaining really, but I have a curiosity about how people handed money and support all the time could need to file bankruptcy every eight years.
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On a lighter note, , thanks to those here who turned me on to high yield savings accounts. I have a chunk of emergency funds sitting in one making 4.3%. Much better than the local banks near zero interest.
, thanks to those here who turned me on to high yield savings accounts. I have a chunk of emergency funds sitting in one making 4.3%. Much better than the local banks near zero interest.No disrespect, but I feel some of your post is a narrative that you accept because of mass media.
Even in these two paragraphs, you have two conflicting points of view.
You say the rich if they have a problem in retirement it is entirely their own doing.
Yet, if you are poor, you seem to imply it is not entirely their own doing.
Next= you seem to buy the narrative that Social Security is going to go broke and everyone magically is going to see 25% of their Social Security income cut. That’s a mass media click bait story. Social Security contributions will be adjusted when the time comes. We are a long way away, and it could be fixed with the stroke of a pen.
Sadly, many people do not understand that. And because of mass media and social media everybody panics. Fear controls the population. One stroke of a pen Social Security is fixed.
Next= Social Security is supplemental income. This should enable someone who has never saved a dime in their life to live in a room somewhere and buy underwear as well as have heat. That was the only purpose of Social Security. A supplement to help the indigent if they worked and contributed to the system during their lifetime. For those who did save and work their whole life, Social Security is a nice benefit of extra income and why its intention has always been supplemental income.
If you want to be free, these are the choices you face in a free world. Success can only be guaranteed for those who work hard at whatever they do. We are part of the animal Kingdom, and we do the best we can in this country for people who can’t seem to survive, but there is no guarantee for survival.
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Well put, Sir.
What is overlooked in this thread is the value of real estate as a part of one's net worth. Not everyone has mortgage debt or very minimal mortgage debt.
Many have very significant equity in their homes because of where they chose to purchase and how property values have increased in those certain areas over time. This is especially true for most properties on or near water...ocean, bay ,lake, river etc...
Many have very significant equity in their homes because of where they chose to purchase and how property values have increased in those certain areas over time. This is especially true for most properties on or near water...ocean, bay ,lake, river etc...
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