Personal Retirement Funds

[Ninja]

Real numbers

Gents, I know the military isn't for everyone...but after 20 years (~42 years old) you have essentially a 1m + annunity that is inflation ajusted, secured by the US govt + health care for your family. You will not find a financial advisor out there offering such a product...40K/year for life adjusted for inflation + healthcare. Not to say this doesn't come without huge sacrifices. God speed to those still serving! And hey young guys, the grass isn't always greener on the other side...think long term.

 

[psysicx]

The best thing to do is to talk an investment advisor. And GV are you sure about those numbers? The goverment is only going to tax the amount you take out. Thats why its better to start taking money out earlier so you get a better tax bracket.

 

[satpak77]

The best thing to do is to talk an investment advisor.

Glad to hear your stance seen from your high school library internet terminal is different than it was before

Make sure you start taking out money at little bits so that it doesn't get taxed as much. What I mean is, if you start deducting money at 75 you have to take out more which causes you to loose more to taxes then if you would have done it at 50.

and...

The reason people invest in Mutual Funds is so there eggs are not in one basket.

and...

And a Mutual Fund doesn't just invest in the stock market. There are other investment vehicles.

The stock market and investments are a risk. But thats why we have money managers who spend there life watching it. All the rich people have money in bonds and stocks so that has to say something. There are things that are way low risk and ones that are insured. Just use a company that has a proven record. Even when the market crashed in 01 there were still lots of people who didn't loose everything.

and...

With IRA's and 401K's its very easy to retire a millionaire if you start early.

while we are at it, where is LOWECUR when we need his sage advice

:crying:

 

[psysicx]

I'm not in High School.

 

[ms6073]

I totally disagree but do what you wanna do.

I have heard every excuse in the book for people doing things financially that they wanna do. They make excuses for leases, credit card debt, unsecured loan debt, home equity loan debt, etc etc etc.

A 401k match should only be made when all debt is paid off.

Spoken like a true Dave Ramsey fan - not that there is anything wrong with that. The ideal being completely debt free and money in the bank makes hicups in the career track/progression a non-event. Unfortunately it is hard to get people to identify with this financial philosophy and for that reason, I don't spend a lot of time trying!

 

[ms6073]

Remember the power of compounded money....20% interest on a credit card versus 8% in your 401k is a no brainer. But paying off a 5.5% mortgage early when you could earn 8% in the market is just stupid...especially when you factor in the tax savings of the deductions from your mortgage interest expense.

Ah yes - new math confuses me when people think that paying 5.5% to the bank while earning a subtle rebate on money's we already ponied up to the government is a good deal. So going gonzo and paying off a 15-year mortgage in 5-7 year so or a 30-year mortgage in 10-15 years then paying yourself instead of the bank for the balance of that time is stupid?

 

[BluDevAv8r]

Ah yes - new math confuses me when people think that paying 5.5% to the bank while earning a subtle rebate on money's we already ponied up to the government is a good deal. So going gonzo and paying off a 15-year mortgage in 5-7 year so or a 30-year mortgage in 10-15 years then paying yourself instead of the bank for the balance of that time is stupid?

I could make a good argument for making just your mortgage payments only (on schedule) versus pre-paying (to knock a few years off) but I'd rather take this discussion a step further by asking you one simple question. Your answer (and I am curious if it is consistent with what you are saying above) will speak volumes about your investment strategy as well as level of risk tolerance.

If I gave you $100,000 in cash to buy a $100,000 home, would you pay for it in cash or take out a mortgage?

-Neal

 

[kingairyahoo]

*gets the popcorn out and passes it around*

 

[smellthejeta]

I could make a good argument for making just your mortgage payments only (on schedule) versus pre-paying (to knock a few years off) but I'd rather take this discussion a step further by asking you one simple question. Your answer (and I am curious if it is consistent with what you are saying above) will speak volumes about your investment strategy as well as level of risk tolerance.

If I gave you $100,000 in cash to buy a $100,000 home, would you pay for it in cash or take out a mortgage?

-Neal

Neal, I know this wasn't directed at me, but the proper answers depends on your credit rating (ie what rate you can get your mortgage for) and what your other investment options are. I'd say put 20% down on the house so you can avoid the PMI, and then if you can beat beat 8% on the mortgage, take the mortgage and invest the money (or pay off higher interest debt). But if your interest rate is too high, pay the house in cash. Is it safe to say that if you have to pay PMI, you can't afford the house?

I *still* don't understand the logic (or maybe it was never presented) that says if your rate of return in the investment market beats the rate at which you have student loans or mortgage, that you should pay your low interest debt at the expense of higher interest returns. In other words, if I have debt that I pay four cents on the dollar to maintain, but that same dollar earns me six or seven cents in the market, why should I take that dollar out of the market and put it towards debt? In effect, I am losing two or three cents on the dollar, notwithstanding any tax deductions I can make for having a mortgage or student loan debt.

 

[Checks]

dangerkitty,

you are a real jerkoff. pilotyip may have some flawed argument about not going to college but that is no reason to attack the guy. So what if you think you are some great success?
If I wanted to attack you I would mention the fact that you are one of two things:
1. Single with no family life to speak of. You will retire a lonely old man
2. Married but your wife and kids hate you because you focus exclusively on work and doubling your income every 5 years. The wife will start dorking the gardener and leave you and take half or your 100K salary

Try being more well rounded dude