The Dow Jones closed up another 161; you guessed it.... Another record.
The American Economy is The Envy of the World.
The American Economy is The Envy of the World.
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*Investors Blog*
- Thread starter Warstud
- Start date
This will have to stop someday? What will happen when it does?
https://www.usdebtclock.org/
When? 50, 75, 100 trillion? I don’t know at what point or what might happen. We now pay over one trillion in interest on the debt per year. Enjoy the ride for now as I am doing. We are in uncharted seas. I don’t fight the market but find it scary.
All I know is the spectacular unrealized gains in 401k’s might be in danger of vaporizing one day. 2, 5, 10, 20? years
https://www.forbes.com/sites/eriksh...st-1-t-quarterly-interest-on-the-public-debt/
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Don't worry, they can't vaporize. They need to be taxed. The US system relies heavily on capital gains and similar taxes more than any other country. If those gains vaporize the tax receipts fall, and the deficit explodes, and you already mentioned how bad off we are now, so that would require direct monetization.
So the system is propped up with deficit spending, and inflation. Boil the frog 1 degree at a time.
Doesn't bother me at all. I hope they inflate my portfolio to the moon. However If your working stiff / asset poor or <25 and have poor parents, your hosed.
Careful, @JeffKeryk will call you Mr Doomen Gloom!
I'm with you (surfin' good) and with a plus, just wait until the pop culture goes into doom and gloom after a certain "outcome". No fundamental real change - just sour on everything. "This trade policy will kill us" etc and not saying much more. It's what they do.
That's a pretty good find. Not common around here, I really need to learn how to fly and find these--a lot of these good deals get snapped up the moment they are posted online. Otherwise they are totally beat, or close enough.
This is a good point/post. I never much thought about this.
And you know what? It’s another area of the house of cards that I never thought about
I guess that’s why I learned to just go with the flow and not fight the market. There is so much in play. It’s impossible at least for me to understand it all.
I do think in my years left on this planet. I’ll just squeak through fine. But I do wonder how younger generations are going to be able to survive this and the nation as a whole without some major policy changes which brings me back to I don’t fight the market anymore because I don’t know as much as I think I do if that makes any sense.
Not knowing as much as I think I do, I do think one saving grace might be the rest of the world seems to have just as many problems if not more.
I avoid buying cars located in cities. I like to buy my used vehicles from original owner retirees that are getting too old to drive them
in really nice suburbs where crime = 0 and the owners really take good care of their cars and did oil changes every 3k miles.
I can't bring myself to buy a car from a city (as cars in cities likely already had a hard life).
Adding even more emphasis to your conclusion, reference 401ks and IRAs, all those capital gains are taxed as ordinary income upon withdrawal. For the relatively small benefit of tax deductibility in the year of contribution, we all lose the preferential treatment of long term capital gains over a lifetime of earnings. Plus the heirs lose the benefit of recapitalization upon our death.
Well maybe just the way you wrote it.............the "gains" are not taxed per se. And yes, ANY WD, even if you lost $ over the years (say impossible!!) - take the dough out, taxed as income. No doubt about that!
So would you recommend one to contribute to 401k only to the level of getting corporate match, then switch to Roth and max that, then if there is money left over, do ordinary investing?
Very few people understand this.
Of course, if your of limited means then your income tax - current and future - may be less than capital gains anyway.
I contribute my max to the 401k, do his and her backdoor Roth contributions, max out our HSA but I use it as an investment and not to pay medical bills. Any excess then goes into a regular brokerage account.
Suddenly my Fidelity advisor is trying to reach me.
Must need to get a good present for the wife this Christmas.
Must need to get a good present for the wife this Christmas.
Something I never see mentioned--so I must not be understanding--that in retirement one still fills out the same paperwork, and thus MFJ means the first $30k is tax free (at the federal level anyhow). I'm not sure how that plays in with SS income and overall taxes, but it's not that the entire 401k withdrawal in retirement is taxed. Or it is, but the standard deduction changes the math a bit.
Of course, RMD's complicate things.
I could take the cop out and say everyone's situation is different, and it depends...but I won't.
In my situation (retired 9.5 years) I'm paying more income taxes than when I worked. I've been religiously rolling over my comfort level to Roth each year since retirement, but the taxable IRA is still worth more than when I retired.
Knowing what I know now, I would do exactly what you suggest, with the addition of rolling 401k/IRA to Roth at retirement at a rate high enough to cover all taxable account gains plus some principal even if it's uncomfortable. In my defense for not doing that, I never expected these retirement accounts to amount to much more than hobby money.
Thank you. It's a data point for me to mull over. The usual boglehead advice is to do whatever in 401k to get corporate match, then switch to Roth, then go back to 401k. That may well work for the average person (who might never get to the level of maxing out both), but its possible for people who keep investments on the "aggressive" growth side to get appreciable 401k holdings, it seems.
Will say, it was nice when I could keep my taxes low but last couple of years I've tripped into the next bracket and I don't like the idea of how each additional dollar loses that many more pennies. My marginal rate might be ok but...
As much as I'd like to keep maxing mine out, I do feel like it won't be long before I wish I had money outside of retirement. As in, something more liquid.
May be worth looking into if you have a Roth 401k option as well, creates a different path to directing a large chunk of assets to Roth dollars.
I'm debating it, I have access to one.
Inflation will be off the charts depending who wins in nov. In the last 4 years GLD is up 48%. If that party wins again I will go from $12K to $62K. Thats a no brainer. Now this is money that I can live without. So yea... I will put $50K into SLV
Do some investigation into the differences between SLV and PSLV. I have read from credible sources that, while share price is designed to match the price of silver, SLV doesn't have the physical to match their shares. They even state that in the prospectus. PSLV does have physical to match each and every share. It matters if there is a serious silver squeeze because SLV might go Tango Uniform.
PSLV is what I decided to go with three or so years ago when I researched it.
