Richness?

[Crazed_Insanity]

Well, Cuda, you’ve accumulated experiences most of us won’t ever catch up!

Anyway, it’s never too late to start saving! 401ks employer matching money is free money! Make sure you extract the most out of that. 401k/IRA can also help you save on taxes. So put as much money into it that you can afford.

Within these retirement funds, buy into those market index funds. Meaning that these funds will match trends of overall stock market. Just regularly put away same amount of money and ignore market swings. In the longterm, you should come out ahead.

Another thing you should consider is real estate. Buy as many houses/rental properties that you can afford.

As for cars, like IMOA suggested, only buy cars that’d go up in value!

[Dicknose]

Id also say loans/credit cards are bad - unless you are buying something important and that holds or increases in value.
Car loan - crazy!
You are paying interest on something that is depreciating.
If you cant afford the car, buy a cheaper car.

I know people who talk about their great savings and investments, then go get loans that pretty much cancel any money earned from their savings.
Ok its easier said than done. I had a car loan for my first car (back in the 80s) and paid it off in 2 years. Never had a loan or credit card debt since - until I got a mortgage for a property. Even then I had a 20% deposit and paid off as much towards the mortgage as I could. Extra money thrown at it. I was lucky I had a well paying job and I paid my mortgage off in just over 10 years.

Borrowing should really be kept to a minimum. And definitely not for luxuries.

[FaultyMario]

What?

Delta goods equals Delta utility, ergo happiness.

Postponing consumption is only decreasing utility.

[Crazed_Insanity]

Delayed gratification makes one rich. Saving money and the magic of long term compounding interest or assets that appreciate in value like your house...

Instant gratification makes one poor. Spending money to buy cool toys that make you happy now, but end up not saving your money or being slaves to your creditcard debts... and also forever renting and rent costs continue to rise...

Of course Neanderthal's brother is right. You could drop dead in the next minute. So no point delaying everything. So just spend within your means. I do agree with DN that creditcard debts are bad. I had occasionally needed the extra cash by utilizing 0% interest offers from creditcards, but I'd still pay a 2~4% fee for the amount borrowed. I'd always pay back before the 0% interest period expires. Nowadays if I'm strapped for cash, I'd borrow from myself. Yeah, in the US, we could take out a loan from our 401k plan. It won't be interest free, but at least you pay that interests back to yourself!

Only borrow money on real estates or other 'assets' that might grow in value.

Of course for big ticket item like a car or whatever else depreciating consumables, it's probably not possible for most people to just buy it with cash, but we should borrow the least amount of money possible.

[CudaMan]

That's a great point on debt. Somehow I was taught well on that one. My credit card gets paid in full every month and is just used for the convenience factor. I've never taken out a loan for a car - I save up and pay cash for used cars that have already taken most of their depreciation. The only thing I've taken a loan for is my house. And speaking of houses going up in value... mine really hasn't since 2004 if you adjust for inflation. Now if I had bought just a few short years earlier I would have paid literally half of what I did. A lot of people came out ahead on that in CA.

I turned my house into a rental when I went to England and kept it that way for a year or two after I came back. Ended up not really being worth it because the renters caused enough damage to offset what they were paying.

[neanderthal]

Bryan.

If you need to join the game and "catch up," think dividend stocks. They won't go up 50% like my company stock did in one year, but every month, every quarter, every year you'll get paid. Don't take the dividend, reinvest it in that stock.

Check out the videos in this link. Personally i'd go McDonalds, 3M, PepsiCo, Johnson and Johnson. None of those companies are going out of business soon. They pay dividends regularly and I think they raise their dividends regularly too. Ask Swervo to ask his dad what he is invested in.

billi is absolutely right about getting rental properties. If you can do it, that's a fantastic way of generating passive income and building wealth. The problem mainly, is that property prices in California are ridiculous!

Don't despair. But mostly don't do nothing!!! You can set up an IRA, and/ or a Roth IRA (a Roth IRA is after tax income, useful if you think you're going to have much more money in your old age than now. Or if you're hedging that tax rates are going to go up. I put 2% of my 401K withholding into a Roth 401K as a "just in case."

DN is right; eliminate all your credit card bills as soon as possible. Use the snowball method (smallest balances first, then roll over that payment into the next smallest when you pay it off) but eliminate your credit card bills. Then start aggressively paying your (future) self.

[Crazed_Insanity]

And speaking of houses going up in value... mine really hasn't since 2004 if you adjust for inflation. Now if I had bought just a few short years earlier I would have paid literally half of what I did. A lot of people came out ahead on that in CA.

I turned my house into a rental when I went to England and kept it that way for a year or two after I came back. Ended up not really being worth it because the renters caused enough damage to offset what they were paying.

Wow, sorry to hear that hasn’t been working out for you... I guess location is important!

Btw, those renters caused enough damages that you’re unable to cover them with the security deposit?

[Jason]

Losing 10% of my retirement over the last few days is not a great feeling.

[Crazed_Insanity]

Paper profits/losses are not real.

Finality comes only on the day that you sell with actual cash in hand. Actually, ultimate finality comes when you actually spend that cash to buy something for yourself. Remember the wise words of Neanderthal’s bro, we all could kick the bucket any minute. Even cash in hand may not be real if you don’t got time to spend it!

We ought to try to ‘feel’ more important and immediate stuffs around us... from our family and friends... unless Jesus returns or the world ends in some other ways... rest assured stock market will always come back! -10% is nothing!

You might as well just stop checking your 401k balance. Of course if you’re retiring soon, you better cash out now!!!

[Jason]

Unfortunately I see it every day when I review all of my finances to make sure everything is in order haha