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Thread: Richness?

  1. #1
    Senior Member Leon's Avatar
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    Richness?

    Do we have a grown up thread for money / investments and suchlike?

    Due to the severely crap interest rates on savings in NZ, I'm branching out into some managed funds, and shares.

    Clearly there's zero point in mentioning the NZ based shares that I've bought, other than in general terms, retirement homes, as we've got an aging population.

    But I've gone in with some US Managed funds (in clean energy thus far), Tesla, AMD, and some others.

    I've got also a fairly conservative retirement fund, and a really crappy little rental property, so I'm reasonably diversified.

    What are other folk doing, or looking at doing, for their retirement funds / passive income goals?

  2. #2
    Administrator dodint's Avatar
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    Most of my retirement is in a defined contribution plan, similar to a 401(k). It is pretty passive on my part but it has healthy returns. I am a federal government employee and the plan is through work, so it has very low operating costs which also helps pad the returns.

    Part of the reason I pursued finance in college was so I could manage my own money, but I lost interest in it.

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    A former coworker retired. Young dude, late twenties maybe early thirties. He trades crypto currency for a living now.

    Me, i'm ... ok. Single. No kids. No debt outside my bike and a couple of credit cards. Healthy 401K balance. I'm ahead of where the "how much you should have saved by age" articles say. In fact i'll make more money than i'll make now.
    I have a pension too, through the union.
    Part owner of a small business with some fellow Zimbos. We, in our, business have some investments in the US, Canada, Zimbabwe, South Africa, Ghana, Nigeria and Kenya.\


    I'm looking at Beyond Meat, some weed stocks and the company that found a vaccine for corona virus as our next possible buys.

  4. #4
    Senior Member Leon's Avatar
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    What's a 401k ...?

    If the managed funds results from the weed growing industry are a reflection of that market as a whole, those results appear to have been disastrous.

  5. #5
    Administrator dodint's Avatar
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    401(k) in a nutshell. A percentage of my gross pay is taken out of my check, and in my case the employer matches the first 5% (if I contribute 10% I really get 15%). It goes to the 401(k). I can choose from about 8 different funds to put my contributions in, and can move it between funds whenever I want. Each fund is comprised of different stocks, mutual funds, and other securities based on a theme. Each has a different risk profile. The money I contribute is not taxed, it actually reduces my taxable income. It is taxed when I withdrawal it at retirement.

  6. #6
    What does the Bat say? Jason's Avatar
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    I've been thinking a lot about this as I edge closer to 40. I have a 401k, and a Roth IRA. Calculators say I'm on track if social security estimates are accurate, but I have a feeling they won't be, and I should be saving more. I'm well behind what various articles like to say in very general terms. So yeah, I should be saving more, but I'm already saving 20% of my income, and having very little fun with the limited amount of money I have left over after bills.

    Yay, adulthood?

    My 401k is in a targeted date fund, and is doing great. My IRA is a mix of targeted, and index funds. I think I should probably throw in some sort of international fund, but I have no clue what to look for there. I'm not about gamble on individual stocks, since I'm absolutely ignorant there.

  7. #7
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    Quote Originally Posted by Jason View Post
    I've been thinking a lot about this as I edge closer to 40. I have a 401k, and a Roth IRA. Calculators say I'm on track if social security estimates are accurate, but I have a feeling they won't be, and I should be saving more. I'm well behind what various articles like to say in very general terms. So yeah, I should be saving more, but I'm already saving 20% of my income, and having very little fun with the limited amount of money I have left over after bills.

    Yay, adulthood?

    My 401k is in a targeted date fund, and is doing great. My IRA is a mix of targeted, and index funds. I think I should probably throw in some sort of international fund, but I have no clue what to look for there. I'm not about gamble on individual stocks, since I'm absolutely ignorant there.
    Think about companies that aren't going anywhere/ folding anytime soon, that pay dividends regularly. McDonalds. 3M. Johnson and Johnson. Pepsi (I think. etc) You can watch youtube videos of people who've made passive income this way.

    That's a pretty safe way of betting on solid stocks. Reinvest the dividends and your portfolio grows. It'll be hard to "catch up" to where you should be, but you cam ameliorate that with growth. The stocks won't go up like Tesla, but the dividends will keep trickling in and time will do the rest.

    Which reminds me. I need to get on that shit too!

  8. #8
    Jedi Cam's Avatar
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    Retirement savings? Hah! The life of a freelance/fine artist: no retirement plan or savings. I had a bit of retirement savings from when I worked in Hollywood. Alas, it was so insignificant that I just cashed it out to pay for a small portion of my university tuition. My wife will have retirement savings, of course, because she has a real (good) job. We have some debt from my schoolin' that we are still paying off. Although, we bought the motorcycle with cash money. I do not measure my success by my bank account. I want to be rich in life and enjoy it. I consider myself lucky that I have luxuries and a lifestyle that many cannot afford.

  9. #9
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    Quote Originally Posted by neanderthal View Post
    Think about companies that aren't going anywhere/ folding anytime soon, that pay dividends regularly. McDonalds. 3M. Johnson and Johnson. Pepsi (I think. etc)
    My dad almost entirely invests in these. He's retired, home's paid off, thanks to prop 13 in CA they're paying almost nothing in property taxes, and he's making well over the median income for the area on dividends alone.

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    Wow, your dad is the man! Assuming 2% dividends and median income of ~$50k... that means your dad has at least $2.5 Mil worth of dividend paying stocks!!!

    I used to own some stocks, but had to sell them to cover family expenses...

    Anyway, now that I'm older, I'm beginning to think 401K was a semi-con invented to help rich people get richer. I'd call it semi because it is good to force or encourage people to put money away for later, but then we collectively helped pushed the stock market to very lofty and maybe unrealistic heights! All the money stashed away with no place to go except to be dumped into the stock market...

    I think most people don't have to mind set to become rich... because when most of us have money, we just spend it... not only that, most of us are afraid of the risk of losing money on investments and lack of patience. Don't get me wrong, I share these traits myself, that's why I'm not rich!

    In order to be truly rich, you have to use money to make more money. Ideally, use other people's money to make money. The only way I know how to do this is real estate. I buy a house paying only 0~20% down at a set price. 80~100% of that home is paid by the bank. Decades later when the house goes up in value... the bank won't be able to share that profit with me. That's just pure profit... making insane amount of money all the while using other people's money! Of course your house could go down in value, but then you could still live in there. Rent will never rise. Mortgage interests tax deductible... once the loan is paid off, you're rent free! (Other than property tax of course) So for us commoners, this is our best way to build wealth. You can imagine for those Wall Street bankers having variety of similar schemes that could use their client's money to help them make more money. And if you look at forever renters, yeah, their lives would be easier, never have to repair anything or mow the lawn, but their rent for continue to increase... so the wealth gap between the home owners and renters will continue to increase...

    If I didn't have my house, I'd be a lot poorer now.

    Anyway, IMHO, the best wealth generator is probably to have a successful business. But of course, it's super hard and super risky... that's why we don't have a lot of Elon Musks around.
    Last edited by Crazed_Insanity; February 21st, 2020 at 08:53 AM.

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