Am I going to end up in the poor house in retirement?

[Nickshu]

That's a good strategy...move into the house, pay down some of the mortgage, let the average rents in the area climb, then turn it into a rental. Where I live just buying outright to rent will not cash flow b/c the mortgages are high and the rents are low.

Mom and Dad did the same, they had 8 years of college for me and my little sister. They sold one rental property each year of college and funded tuition, etc with it. Worked out beautifully.

[wdfifteen]

Originally Posted by aschen

I think life insurance "investment" is prob the worst financial mistake many people make. It makes huge money for the people that sell it.

Do yourself a favor and look at all the fine print of the policy and vette it with somebody else besides the guy selling it to you.

+1000
Whole or Universal life insurance can be part of an investment strategy IF you need life insurance AND are in a high tax bracket. There is a limit to how much "investment" money you can put in them.

[fintstone]

Originally Posted by Nickshu

That's a good strategy...move into the house, pay down some of the mortgage, let the average rents in the area climb, then turn it into a rental. Where I live just buying outright to rent will not cash flow b/c the mortgages are high and the rents are low.

Mom and Dad did the same, they had 8 years of college for me and my little sister. They sold one rental property each year of college and funded tuition, etc with it. Worked out beautifully.

Middle class and lower middle class homes have done the best for me. They just need to be where there are great schools and good jobs.

Every time we moved, the wife got a little nicer house. I got a couple of years to fix things, etc. The only small problem is that your final house will probably be quite nice and not paid for going into retirement. On the other hand, with several paid for homes rented out, you need the tax write off...and might as well get a 30 or even a 40 year mortgage as you really don't care if you ever pay that one off. If you die at 80 with a mortgage that is not paid off, it is no problem as your heirs will probably sell your home for the equity anyways. Obviously, if it makes you more comfortable, you can refinance some of the rentals to pay off that home (or sell them and do the same).

As the home increases in value and as you pay down the mortgage, it changes some of the math. Although you have invested only $3k of your own money in that $100K home, if you have a 15 year mortgage, in 15 years, you may have $150K or more in equity (even though you still invested only the $3K of your own money), yet your rent may have only risen from $800 per mo to $1000 per mo. On the other hand, when the mortgage pays off, your expenses go way down (although repairs may slightly increase). So, while a $800 mo return on your initial $3K seems like a lot, $1000 mo on your $150K equity may not. For me, I still like the diversification and the cash flow nature as current income as opposed to capital gains (as I will already have a large part of my portfolio in the stock market via 401k...and if I sold a long-term rental, paid the capital gains and realtor fees and invested the remainder; I would have a hard time getting similar return in a relatively safe instrument/investment.

[tabs]

Originally Posted by ckelly78z

$1,000,000 is more than enough to retire comfortably if you don't spend like most people do nowadays. The house should be paid off or close, there is NO reason to have new cars, that country club membership, and the lifestyle that goes along with it (expensive dinners, clothes, jewelry, trips) does not buy you happiness.

Millions of people live outside of Southern Calif, and do really well on far less living expenses. So many of us think that the morning starbucks, and the lunchtime Bistro are necessary, but I enjoy talking in the company lunchroom with friends who also pack their lunches, and drink the provided coffee. I'm not in sales or a management position, so I can wear regular street clothes rather than the latest fashions. My wife doesn't need to refurbish the house with new furniture and fixtures every 3 years because it's "out of style", and we drive 10 year old cars. Our idea of fun is to go camping with friends, take our bicycles, cook out over the open fire and swig a few beers......pretty cheap entertainment.

For those who live in the fast, expensive lifestyle of big cities, you may want, or need to look at cheaper alternatives in a different area to make your retirement money last.

Ahhh..that 1M retirement stash will just about cover the life style you tout...and not the high fashion one either...

The dirty little secret is that even Billy Gates and Warren the "the profit of Omaha" Bufett don't have enough of money either... it is all the high and fast game of Macro economics that is going to wipe you clean. NEVER and let me repeat NEVER EVER before have the powers that be in the USA fked with the very economic (fiscal & monetary policy) ground that you stand on. What makes the dose even more deadly is the preeminent position of the USA in the Global economy. That just wipes everybody clean...

So fk all your retirement plans...I find them to be delusional.

You are all dealing with what was and not with what is now the new reality. Do not feel so all alone, most of the Wall Street types, Monetary policy makers, Fiscal Boyz in DC and States, and most of all the Media hucksters are all operating under the same delusional perceptions. However bit by bit they have to give up their notions as the policies that they have believed to be solutions are non operative anymore. In reality their policies never worked as the wealth of the nation was the true magic of their policies.

What the Central Bankers have accomplished is a stabilization of an unstable situation. However they are doing it at a cost, of digging the original hole even deeper. They see no other solution, for the devil you know is better than rolling the dice and meeting the devil that you do not know. The result is slow grinding process of change from a affluent society to a poor society.

Figure it out, with 175T in total US debt against 115T in total US assets everything you (Billy and Warren tooo) own doesn't belong to you...not only that but your future earnings are not even your own....nor are your children's or grandchildrens...is this a sustainable situation or does the system at some point throw a rod right through the block causing the engine of monetary, fiscal and economic policy to seize right up....in that you had better have a good pair of shoes cause you are going to be walking and not riding on down to the bread line. Or will the system just keep on grinding you down, where as you give up a bit of your American Dream a bit at a time until you find yourself walking on down to the modern equivalent of a bread line.

Probability says that it is not an either or situation, but a third alternative. which would be a combination of both scenarios. One where a monetary crisis does occur, which irrevocably changes the perceptions under which you operate but leaves you with a semblance of your previous life. Here one thinks that those who think that they can afford both a Ferrari and a Porsche will have to settle for posters of them on the wall.

In conclusion, and AGAIN let me reiterate, it is a hard thing to get your head around but the thing that destroys absolutely is that the powers that be are fking around with fiscal and MONETARY POLICY of the RESERVe CURRENCY for the Global economy... That in of itself is a game changer..

[tabs]

Ladies and Gentlemen and other assorted punk azz mtherfkers. I keep on working the equation, adding in new data all the time to see if the conclusions I have arrived at are still an accurate assessment...if ones conclusions are still operative?

The one factor that one inescapably can not get around is that 175T USD in debt. Sooner or later, the biggest bubble of them all is going to POP! Unless of course GRAVITY does not prevail and we are in an alternative universe after all. Since the advent of Keynesian economic theory, the magic bullet of economic rectification has been government stimulation of the economy and or and inflationary economic policy. This has been the operative norm since the the 1930's and with certainty since the end of WW2. During the succeeding decades it seemed to work like a charm providing for an ever expanding economy. However now with the current debt levels not only are the edges of that policy becoming frayed but the center is no longer holding. Here we see massive and increasing geopolitical and domestic instability along with ever more variations on a theme of stimulation through provisions of liquidity. Yet after 6 years of trying one thing after another the center still does not hold requiring yet another round of juicing the system.

George Will recently said, "2% economic growth is not going to provide the income needed in order to pay the bills coming due." when the back loaded SS unfunded liability becomes front loaded interest bearing debt and thus "the current system is unsustainable."

What we have here is a massive and ever expanding debt that is sky high with a deflating economy as the consumers who have propelled an inflating economy are tapped out. Thus the bills to be paid are getting higher (debt) while the income to pay them is shrinking.

The inevitable solution is a cut in lifestyle whether forced or through attrition. If the government reneges on it's promised entitlements it will be the same as a default on it's obligations. The result will be massive civil unrest as everything that you have known to be true will be thrown right out the window. In effect the ground under your feet will shake.

[Crowbob]

Which brings us to another question.

What to do if in the case of the apocalypse as described herein actually occurs?

There are as many scenarios of survival as there are people. Most are pipe dreams and prognostications. Story-telling. Spin.

If the dollar goes to zero no number of lucrative rental properties, no 401k balances impressive as they appear, not even the fanciest of financial instruments is going to matter one bit. Survival will come down to whomever is the smartest, strongest and most ruthless at garnering for himself and his clan three things: Food, shelter and fuel.

[ltusler]

^Exactly. If the "one" is so GD smart, why doesn't he stop speaking in riddles and offer up some actual thoughts or advice so all of us "Ladies and G/\entlemen and other assorted punk azz mtherfkers" can make some sense of the coming apocalypse?

[motion]

Originally Posted by tabs

Ladies and Gentlemen and other assorted punk azz mtherfkers. I keep on working the equation, adding in new data all the time to see if the conclusions I have arrived at are still an accurate assessment...if ones conclusions are still operative?

The one factor that one inescapably can not get around is that 175T USD in debt. Sooner or later, the biggest bubble of them all is going to POP! Unless of course GRAVITY does not prevail and we are in an alternative universe after all. Since the advent of Keynesian economic theory, the magic bullet of economic rectification has been government stimulation of the economy and or and inflationary economic policy. This has been the operative norm since the the 1930's and with certainty since the end of WW2. During the succeeding decades it seemed to work like a charm providing for an ever expanding economy. However now with the current debt levels not only are the edges of that policy becoming frayed but the center is no longer holding. Here we see massive and increasing geopolitical and domestic instability along with ever more variations on a theme of stimulation through provisions of liquidity. Yet after 6 years of trying one thing after another the center still does not hold requiring yet another round of juicing the system.

George Will recently said, "2% economic growth is not going to provide the income needed in order to pay the bills coming due." when the back loaded SS unfunded liability becomes front loaded interest bearing debt and thus "the current system is unsustainable."

What we have here is a massive and ever expanding debt that is sky high with a deflating economy as the consumers who have propelled an inflating economy are tapped out. Thus the bills to be paid are getting higher (debt) while the income to pay them is shrinking.

The inevitable solution is a cut in lifestyle whether forced or through attrition. If the government reneges on it's promised entitlements it will be the same as a default on it's obligations. The result will be massive civil unrest as everything that you have known to be true will be thrown right out the window. In effect the ground under your feet will shake.

Tabs, we're all quite a bit worried about you, old fella.

[ckelly78z]

W O W !

I feel sorry for TABS, he has no hope, and spouts off about having no future and only doom and gloom in the forecast. How do you get up in the morning and go to work, and why haven't you shoved a pistol in your mouth yet.

I'll keep you in my prayers that you can find some peace in the world, and can start enjoying the life that you are currently living, and can see some bright spots on the horizon rather than the apocalyptic view.

When this economic apocalypse actually happens, we will all bow to your superior knowledge, acknowledge that we know nothing, name you supreme leader, and put you in charge of the recovery.

[recycled sixtie]

Even if Tabs is one quarter right then there are storm clouds ahead. Blame it on the politicians. So Tabs what do you do to assure your financial security?

[tabs]

It is really simple, do ya think that this music can go on forever? The numbers do not lie to you. How in the world are they going to rectify those numbers?* I look realistically at the possibilities,without the blinders on. I know things can turn in the blink of an eye.

Your best option is to get a small piece of land where you can grow some vegetables, chickens, fruit etc and have it paid off. Have a few shekels in precious metals, some stocked away food stuffs and some armaments. Go solar, have a well for water and some wood for heat. Even in a Suburban setting this can largely be accomplished.

This is not really different than what my Grand parents did back in the Depression.


*Bolles Simpson committee came up with a plan which was DOA. There is NO WILL to fix or ameliorate anything...

[tabs]

Originally Posted by ckelly78z

W O W !

I feel sorry for TABS, he has no hope, and spouts off about having no future and only doom and gloom in the forecast. How do you get up in the morning and go to work, and why haven't you shoved a pistol in your mouth yet.

I'll keep you in my prayers that you can find some peace in the world, and can start enjoying the life that you are currently living, and can see some bright spots on the horizon rather than the apocalyptic view.

When this economic apocalypse actually happens, we will all bow to your superior knowledge, acknowledge that we know nothing, name you supreme leader, and put you in charge of the recovery.

What I posted above is what is REAL and it is the truth. Anything else is a delusion. The numbers do not lie. First QTR GDP 2015 estimated at ZERO PERCENT GROWTH...chew on that one for awhile.

Sooner or later you all will have to face the music.

[wdfifteen]

Originally Posted by tabs

Your best option is to get a small piece of land where you can grow some vegetables, chickens, fruit etc and have it paid off. .

That's my place!

[sc_rufctr]

I'm buying something remote with room out back for a potters wheel and a kiln.

[ckelly78z]

Originally Posted by tabs

Your best option is to get a small piece of land where you can grow some vegetables, chickens, fruit etc and have it paid off. Have a few shekels in precious metals, some stocked away food stuffs and some armaments. Go solar, have a well for water and some wood for heat. Even in a Suburban setting this can largely be accomplished.

This is not really different than what my Grand parents did back in the Depression.


...

Absolutely everything but the solar part of description above, I already have...a paid off house on a wooded 10 acre lot with a creek, fruit trees and bushes, well water, rural setting, garden, 20 chickens, armaments, wood heat exclusively for the past 20 years, and stocked away food stocks.

I guess this is why I misunderstand how much money it takes MOST people to live, especially those that don't have any of the criteria listed above.

[tadd]

I do realize this is a Porsche bulletin board, but geeze guys... y'all do realize that the average earning in the USA is $36k, right? $50k is considered a good salary in most places. Assuming you can put away 1/2, which would be mighty hard unless you were w/o kids, you'd be lucky to make your million in 30 years. Me, I had a sick wife. Drs told her at 18 she wouldn't make 30. Had her till 45. Wouldn't trade dollars for love, that's for damn sure. I think we all over think the retirement thing...

All I want is to get the house paid off. IMHO, this is 'the key' (along with any infrastructure you want...shed, barn... After that its all gravy. If I've got a roof over my head and some space under my feet, I can make the rest work. Its actually way more fun to make my own whatever (booze, car, plane, chair, etc.) than to buy anyways...

I also don't believe that Ill ever be totally without some earning.

My last catastrophic expense spread sheet was just under $1k a month without the mortgage. That's cell phone, 4 dogs, $15 a day food, insurances, ect. $33 a day doesn't seem so bad. Of course I live 'out' so no water bill (well) or sewer bill (septic), which is not cheap. Heat is wood, so just the electric bill. If all goes well I'll zero that out with PV panels I'm slowly adding in every year.

Even at stupid Maryland property tax rates, I can collect $5k in aluminum cans in a year .

You can either make ****you money, or stay under the radar...

[recycled sixtie]

From my prospective I see the high cost of living areas are for instance the lower mainland of BC which includes Vancouver and to a lesser extent Victoria. In the US it would be California particularly the coastal areas. Add the hight cost of property purchase plus the high property taxes for instance and once you get used to the lifestyle and great climate then your cost of living is high over the years. If you make big money then than offsets that but not everybody does.

It is not so much how much you make but how much you spend. I would think those that live in States such as Montana, Ohio etc the cost of living would be much lower.

Tabs is right in that you have to batten down the hatches. I would have a rainy fund. For now your US $ is strong but the next recession it could go the other way and there will be another recession.

Guy

[ckelly78z]

Flyover states are good for something.

[madmmac]

Ok, I have 2 million in my 401k and all I want is 3-5% a year. Let's hear the plans.

[recycled sixtie]

Originally Posted by madmmac

Ok, I have 2 million in my 401k and all I want is 3-5% a year. Let's hear the plans.

If you want me to stick my neck out then I need a commission. All in green font LOL
Guy