|
|
 Up |
|
|
  |
Author: John A. Weeks IIIJohn A. Weeks III
Date: Jan 19, 2007 05:57
> I'm 27, have combined income of 140K, save about 2-4K a month. Not
> really thinking about retirement savings too much, since it seems so
> far away.
This is a case of a simple error in judgement, which, when compounded
over time will result in a huge financial blunder. Due to the time
value of money, your 20's is exactly when you get the biggest boost
from savings for retirement. As an illustration, if you save from
20 to 29, then never save again, you will have more retirement money
than if you start a 30 and save until you are 65. You are young
enough to still catch this wave, so don't screw it up. You don't
want to end up 70, broke, and fighting the stray dogs and alley
cats for the scraps of food that folks leave in the dumpster.
-john-
|
| Show full article (1.15Kb) |
|
| |
no comments
|
|
|
Author: Todd H.Todd H.
Date: Jan 19, 2007 05:55
> Sorry it took me so long to get back on this thread.
>
> I'm 27, have combined income of 140K, save about 2-4K a month. Not
> really thinking about retirement savings too much, since it seems so
> far away.
Which makes it the ideal time to think about it because you will need
all that time to let compounding do its work. :-)
> I think I'm going to take the advice of doing both things: putting more
> into my 401, at least to max out my employers match, and pay off more
> on my mortgage, which is down to about 140K and 29 years left on it,
> about 1k, month minimum payment. I will probably move this coming
> December to a bigger house, kids coming soon :) So that may change,
> but the new mortgage will probably be around 200K. I just bought a
> house that is now worth about 160k more then when I bought it - I'm
> planning on selling this one and getting a bigger one in a nicer
> neighborhood for a 60K mortgage diff.
Nice.
|
| Show full article (1.99Kb) |
|
| |
no comments
|
|
|
Author: ShhhhShhhh
Date: Jan 19, 2007 05:52
I apologize in advance for the ignorance this question posseses... I've been
reading a book called "Beating the Dow with Bonds" by Michael O'higgins
http://www.amazon.com/Beating-Dow-Bonds-High-Return-Outperforming/dp/088730883X/sr...
it's kind of a follow up to a former straegy of his known as "dogs of the
dow".
anyway in his book he states if certain conditions are met: "invest in u.s.
treasury bills due to mature a year from now" now I've looked high and
low... does treasury direct offer a 1 year t-bill? I can find 6 month, and 2
year but no 1 year. Am I not looking in the right place?
Thanks,
Shhhh
|
| |
|
2 Comments |
|
|
Author: beliavskybeliavsky
Date: Jan 18, 2007 08:00
Tad Borek wrote:
> 4. Beliavsky, in your sub-par-IQ scenario (setting aside THAT topic
> entirely), have you thought about going back to school during
> retirement? Don't laugh, I could see it, I've thought of it myself.
> Excess 529 dollars...change beneficiary to yourself and fund another
> degree. Semester abroad anyone? I believe the rule is that any overseas
> institution for which you could receive financial aid qualifies for 529
> withdrawals. LSE class of 2050?
If I put money in John's (to pick a name) 529 account, I may feel
morally obligated to use that money to send him to college if he wants
to attend. I would not feel that way about a regular taxable account.
Even if John is college material, if I put only limited amounts in a
529, I can more easily say, "do you want to me to spend X for a private
university or Y for a public one", with him pocketing X-Y (maybe at age
30 -- many teenagers cannot be trusted with large sums of money) in the
latter case.
|
| Show full article (1.23Kb) |
|
no comments
|
|
|
Author: FranksPlace2FranksPlace2
Date: Jan 18, 2007 06:49
Many people underestimate the value of the stock purchase plan.
Consider this example ROI calculation. You invest $100 per month in
the spp. At the end of the quarter, you get $353 worth of stock (15%%
discount), a gain of $53. You have the stock to hold or sell. Your
average investment in the spp for the quarter is $150. Next quarter
another $53 gain on an average investment of $150. Same for the third
and fourth quarters So at the end of the year, your gain is $212
(4*$53) and your average investment is $150. The ROI is 141%%!
Now all the naysayers will point the price of the stock might change,
that there is a holding period and that you can't find another
investment to put your gains in. This is all true but you still made
141%% in the spp.
I do not recommend holding your employers stock in the long term. It
is too risky to have your job, your retirement and your savings all in
the same company.
Regarding your Master's, I suggest you ask your employer if you could
be considered for Executive MBA where the company pays for everything:
tuition, books, etc..
Frank
|
| Show full article (1.43Kb) |
|
2 Comments |
|
|
Author: John A. Weeks IIIJohn A. Weeks III
Date: Jan 18, 2007 05:45
> I'm currently 21 and recently began a full-time job paying around 60k.
> My company matches 401k at 4%% and has a decent stock purchase plan
> (quarterly buy-in at a 15%% discount of lowest price of either first or
> last day of quarter). I don't plan on marriage, children, purchasing
> real-estate in the near future. I would like to go back to school for
> my masters or MBA in 4 to 5 years.
What a great place to be, and to have escaped college with only
a manageable debt load rather than enough debt to choke a 3rd
world country.
I think you are doing everything right as far as maxing out
your retirement options. I'd pay back the 7%%+ personal loan,
and the 6%%+ student loan. I'd pay the minimums on the other
two student loans. Those are cheap, and they can be deferred
if you go back to school.
|
| Show full article (2.25Kb) |
|
2 Comments |
|
|
Author: BeachBumBeachBum
Date: Jan 18, 2007 05:10
"teaks" gmail.com> wrote in message> Hello, I'm new here and am looking for some advice (snip)
>
>
> I began investing in a Roth IRA account when I turned 18 and have
> around 5k in it so far. Finally, NO credit card debt, car loans, etc.
>
> That's me. Right now I'm thinking a good strategy would be to max my
> 401k up to at least my employer's contribution and also max out my
> annual Roth IRA contribution (I think the limit is 2500?). I'm also
> kind of thinking I should try and completely pay off the private loan
> at 7.65%% ASAP and begin chipping away at the other federal loans. Also
> considering making only minimum payments on the 2.75%% loan.
>
Congratulations on good thinking and having no credit card debt, etc.
Maxing your 401k up to employer match and maxing your Roth (4000)
are good ideas. However, first I would lay out a five year financial plan
on a
spreadsheet based on your short and long term goals. How much cash
will you need in 5 years to start your MBA program? Do you have an ...
|
| Show full article (1.88Kb) |
|
no comments
|
|
|
Author: PeterLPeterL
Date: Jan 17, 2007 21:31
The Henchman wrote:
> Hoping the moderators let this in and if they don't hopefully they tell me
> why...
>
> Came up with an interesting investing scheme today. My credit card company
> sent me three blank cheques that I'm allowed to use for whatever reason for
> an introductory interest rate of 2.9%% (I assume that's 2.9499999%% :). It is
> a cash advance that I can pay another card or myself or whatever purpose I
> want. The introductory rate is good until July 15th 2007 then according to
> the fine print it goes back to 19.97%% (I assume retroactive on the full
> amount I borrowed and not the remaining balance.)
>
> Now Last year I invested $5500 into my RRSP's (Canada's 401k type plan) In
> Canada we are allowed to carry forward past year's worth of unused
> contribution limits. I can still contribute another $28000 because of
> unused cap room space from the past. That $5500 is the first contributions
> towards retirement goals, so my retirement portfolio is now $5500.
>
> My retirement horizon is in thirty years and I "plan" on having 25 years
> worth of income from my investment so that's 55 years. ...
|
| Show full article (3.66Kb) |
|
no comments
|
|
|
Author: scottscott
Date: Jan 17, 2007 09:39
I have heard of a couple who's child got a scholarship and they had
extra funds in a 529, and they took some classes - but the creative
part was that they were held on a cruise ship! LOL
Scott
|
| |
|
no comments
|
|
|
|
|
|
Author: wyuwyu
Date: Jan 17, 2007 09:34
OH charges 0.16%% for their share of the fees. IL is supposedly going to
undercut that even more but no official unviling yet of the 2007
changes. I am funding a 529 (OH plan of course) but it's only a tiny
portion of my total portfolio so even if I have to take out the gains
and pay income tax+penalty, it's not really a big factor when
considering the entire universe.
joetaxpayer wrote:
> If we agree that the major benefit of the 529 is the tax free growth,
> but the cost is a minimum 40 basis points (.40%%) as there are index
> funds at 10 basis points vs the 50 for the cheapest 529, that's about a
> 4%% hit to the account. (say an average time invested of 10 years). This
> to avoid whatever cap gain rate is in place at the time of withdrawal.
|
| |
|
no comments
|
|
|
|
|
