Money & Economics

bigredfish

Known around here
Joined
Sep 5, 2016
Messages
17,390
Reaction score
48,527
Location
Floriduh
It’s fundamental to our society and civilization, yet like me, most of us know, or at least understand it, just enough to be dangerous.

I believe we’re on a precipice of some major changes, and as one soon to retire I’ve done the best I can with the pile I have accumulated given the effort, or lack there of, that I put into it.

Like my parents, I was handed little in the form of money or wealth. Sure they helped me out at critical points in my early life, but nothing that anyone would consider extravagant. In fact it wasn’t until probably my late 20’s that I realized how hard they truly had it. I thought like most youngsters that our family had plenty, but came to realize that they had to fight and scrape for every last nickel to provide a “semi-middle class” lifestyle for us. I never knew they were just barely making it.

They came from hard working lower income Ohio river pottery and mill family’s and worked their asses off to break free of that, for which I’m forever grateful and proud.

I think ones views on money are like most things, largely a result of one’s experience and education, so while some things I may post or subscribe to may be helpful for some, there are likely some that are far more experienced and wayyy smarter that highlight my ignorance.

All that said, I thought I’d start a thread on money and hopefully learn from some of you while posting some things about lessons learned.
 

Gargoile

Getting comfortable
Joined
Oct 18, 2021
Messages
813
Reaction score
3,017
Location
Straight Outta Mayberry
Since they do not teach finance in grade schools, it time we all teach the younger generation about how to save/ invest. Also we are always told to consume and not produce. Once you change this mindset it will open you to a different world.

Also in today's economic environment it is crucial that we teach saving and investing. It will be hard for the I have to have it now mentally but it is necessary for them to know.

I'm teaching my nephews about building a passive income that will provide them an income later in life. Something they can get in an ROTH and forget for 30 to 40 years. One way is buying stocks that have a good dividend return and dividend reinvesting.

It's a start but it's my way of passing down my knowledge to make their life financialy better and secure than mine.
 

bigredfish

Known around here
Joined
Sep 5, 2016
Messages
17,390
Reaction score
48,527
Location
Floriduh
My best advice as of late to a few reasonably well adjusted millennials that report to me when asked was to start offloading/paying down debt about the time they hit 50.

It’s not reasonable IMHO to think one can go without assuming some debt between the age of 20-50, but obviously you still have to live within your means.

My pile isn’t that big but with literally 0 debt now, we can live on our two SS checks without having to touch the nest egg.
(Well except for occasional impulse ammo and bourbon expenses ;)
 

bigredfish

Known around here
Joined
Sep 5, 2016
Messages
17,390
Reaction score
48,527
Location
Floriduh
Any Gold bugs?

I’ve never owned any but have been of late trying to decide whether to invest say 5% of my savings in physical as an inflation hedge.

Lots of theories why the price is and has been artificially manipulated and that paper gold isn’t truly backed by the real thing.

I have the storage worked out, but then there’s the whole liquidating thing…..

I don’t think it makes as much sense as say ammunition in a SHTF scenario but as a hedge, Central banks, particularly China, Japan, Nordic countries and most recently Australia are apparently loading up.
 

Parley

Known around here
Joined
Dec 19, 2015
Messages
5,621
Reaction score
16,006
Location
Cypress, California
I do have some gold and silver stashed away, but that is a small amount of our "savings". Years ago the wife and I had accumulated some money and the question was where do we put it? In the end we decided to pay off the mortgage on our home. So basically, we put it into real estate. Looking back on it, I believe that was a good decision. A more recent decision was to buy a house in the Tampa Bay area and rent it out. So far so good on that investment.
 
Last edited:

Ssayer

BIT Beta Team
Joined
Jan 5, 2016
Messages
19,608
Reaction score
70,938
Location
SE Michigan USA
Job one for us was to pay off the mortgage (a home with land to put in a decent sized garden) and managed that years ago. Self defense was second. Precious metals was third and if it hadn't been for that boating accident a few years back, we'd be set with as much of both as we needed to feel comfortable..
 

Gargoile

Getting comfortable
Joined
Oct 18, 2021
Messages
813
Reaction score
3,017
Location
Straight Outta Mayberry
Any Gold bugs?

I’ve never owned any but have been of late trying to decide whether to invest say 5% of my savings in physical as an inflation hedge.

Lots of theories why the price is and has been artificially manipulated and that paper gold isn’t truly backed by the real thing.

I have the storage worked out, but then there’s the whole liquidating thing…..

I don’t think it makes as much sense as say ammunition in a SHTF scenario but as a hedge, Central banks, particularly China, Japan, Nordic countries and most recently Australia are apparently loading up.
Gold is being suppressed along with silver. TPTB do not want you to have anything outside their fiat systems. But never look at gold and silver as an investment, it is a store of value. Gold and silver are a bridge to the "next" system, or to barter offline.

In a SHTF scenario, look at using junk silver ( pre-64 dines, quarters, half's) China isn't faking these ( that I know of) ...and you can use the 90% silver to buy goods and services as it is more fungible than bars and rounds. Make sure you have an exit plan to sell your holdings. If no one wants it, it's not worth anything.

I would not hold gold or silver stocks as the old saying goes.... If you do not hold it, you do NOT own it.

Some people trade the Silver to Gold ratio. It's at 75 to 1 (as of today) and when the ration gets more to the historical value of 16 to 1, people will then trade their silver for gold.

And do NOT but gold and silver from HSN or the other TV shows. You are underwater and, in some cases, may never recover.
 

bigredfish

Known around here
Joined
Sep 5, 2016
Messages
17,390
Reaction score
48,527
Location
Floriduh
Was looking at APMEX

Totally agree with paying off mortgage and real estate. Took care of the former now if the housing market in FL would just relax a bit we’ll be looking for rental property as well. Still crazy prices here..
 

Gargoile

Getting comfortable
Joined
Oct 18, 2021
Messages
813
Reaction score
3,017
Location
Straight Outta Mayberry
Was looking at APMEX

Totally agree with paying off mortgage and real estate. Took care of the former now if the housing market in FL would just relax a bit we’ll be looking for rental property as well. Still crazy prices here..
I do not think that prices will flatten. The New Yorkers selling their homes think the inflated prices in Florida are a steal. Our neighborhood gets people from NY knocking on their doors asking if they want to sell. It's unreal.
 

bigredfish

Known around here
Joined
Sep 5, 2016
Messages
17,390
Reaction score
48,527
Location
Floriduh
I hear ya. When we sold in June it took 3 days. Listed Friday, 4 offers in first 24 hours, two sight unseen, all above ask (which I thought was 50 too high to begin with) and an even better offer by a bunch Monday which we took. Closing was 18 days.
 

rolibr24

Getting comfortable
Joined
Dec 3, 2021
Messages
652
Reaction score
3,009
Location
USA
I am probably on the younger side here, under 40. I am thankful for my parents. I was raised to never carry debt unless it was for a house, or land which you can make money on (I am a farmer.) My wife thankfully was raised the same way. Thankfully her parents flipped her college bill. Her only stipulation was that she had to work essentially full time, and they would cover what she was not able to cover with her income.

We bought a old farm house, put a bunch of sweat equity into it. About 4 years ago we considered selling and building on another piece of our property, and at that time we were shocked when the realitor said it was worth 4x what we owed on it.

We are now working on building our own family farm, we are cash flowing it. I have such a disdain for debt that I cant pull myself to get a loan. We decided we would rather grow slowly. We are although at a hard spot, seeing we hate debt, but still have a mortgage hanging over our heads with about 3 years left. I feel at this point it is almost smarter to stop paying extra on the principle due to our under 3% interest rate and re route that extra weve been putting in over the years to our farm.

I feel our society has failed miserably by encouraging consumer dept. If parents taught their kids basic finances and what debt actually is, we'd be in a much better place.
 

bigredfish

Known around here
Joined
Sep 5, 2016
Messages
17,390
Reaction score
48,527
Location
Floriduh
I’ll buy more I-Bonds on Jan 2. At almost 7% through May it’s hard to beat. We bought some this summer at 9%.

The interest rate changes every 6 months May and November.

You must hold for a year, otherwise you can let them ride as long as you want up to 30 years. Buy as much or little as you like up to $10,000 per year per person.

 
Last edited:

David L

IPCT Contributor
Joined
Aug 2, 2019
Messages
8,031
Reaction score
21,042
Location
USA
Time To Get Out Of Dodge?
For us it is real simple, your retirement years are not when you gamble with your money. We have Nothing in the Stock Market. We ended up buying some CDs at 4-5% which was unheard of prior to this Recession. For liquid assets (cash) we have a Capitol One Savings account paying 3%, also unheard of. So even with us out of the Stock Market, our money is still making money.

My guess is YTD will close this year with a negative. Add 5-7% avg. yearly return to that negative number and you will get your actual loss for the year...

1671711816982.png

Side Note: Don't remember this with CDs in the Past but they now have Recallable CDs, we made sure ours cannot be Called Back they are Protected. This is very common with Bonds, did not know CDs too.
 

David L

IPCT Contributor
Joined
Aug 2, 2019
Messages
8,031
Reaction score
21,042
Location
USA
I’ll buy more IBonds on Jan 2. At almost 7% through May it’s hard to beat. We bought some this summer at 9%.

The interest rate changes every 6 months May and November.

You must hold for a year, otherwise you can let them ride as long as you want up to 30 years. Buy as much or little as you like up to $10,000 per year per person.

My Father was into Municipal Bonds (munis) in his retirement years. Being a Texas resident, he would mainly buy the non-taxable Texas based Bonds through a broker he trusted. He would get dividend checks all year long which he did not have to claim on his taxes, well you report them but they are not taxable. He was making avg. 7% at one point, plus the tax break. I inherited his Bonds and now I get non-taxable dividend checks :) Now munis Bonds are around 4-5% but with the tax break they are much higher than other Bonds. Plus less risk...

This is why ROTHs are a great investment too. Most people do not realize that when pay taxes on your investment gains, taxes can eat up a lot of your earnings, depending on what tax bracket you are in. So if you made 10% on your money and paid the IRS 30% on those gains, you actually only netted 7%.
 

David L

IPCT Contributor
Joined
Aug 2, 2019
Messages
8,031
Reaction score
21,042
Location
USA
Here is the present rated Bank CDs:


Brokered CDs give a higher return, plus they can be sold...Ladder CDs are also a good way to circulate your money.

Annuity CDs also pay high yields and may be a good investment depending on which company you go with. We decided to stay with Banks, actually bought Brokered CDs from popular Banks; Capital One, Discover, even AMEX through Fidelity...
 

David L

IPCT Contributor
Joined
Aug 2, 2019
Messages
8,031
Reaction score
21,042
Location
USA
My best advice as of late to a few reasonably well adjusted millennials that report to me when asked was to start offloading/paying down debt about the time they hit 50.

It’s not reasonable IMHO to think one can go without assuming some debt between the age of 20-50, but obviously you still have to live within your means.

My pile isn’t that big but with literally 0 debt now, we can live on our two SS checks without having to touch the nest egg.
(Well except for occasional impulse ammo and bourbon expenses ;)
That is great that you can live off your two SS checks. This tells me you are not living beyond your means. Very Rare. We are hoping for the same when I retire. Everything we own is paid off, house, cars, etc. We don't buy beyond our means either. If we don't have the cash to pay for something, we don't buy it, period. Sure we use a credit card to purchase it but we pay for it on the credit card bill. Never paying them interest. They don't like us :) This, my father taught me and I passed to my son which is also debt free except for his recent 10 year mortgage, which he is hoping to pay off within 5 years. Very proud of him, he saved for 5 years and put down a very large amount toward his house. He was hoping to pay cash for his first house but since house prices were rising quicker than his saving he went with a short term mortgage.

So glad we paid off our mortgage years ago and bought our present house with cash. Mortgage Companies are making a Killin' (Compound Interest):


1671717175856.png
 

David L

IPCT Contributor
Joined
Aug 2, 2019
Messages
8,031
Reaction score
21,042
Location
USA
I am probably on the younger side here, under 40. I am thankful for my parents. I was raised to never carry debt unless it was for a house, or land which you can make money on (I am a farmer.) My wife thankfully was raised the same way. Thankfully her parents flipped her college bill. Her only stipulation was that she had to work essentially full time, and they would cover what she was not able to cover with her income.

We bought a old farm house, put a bunch of sweat equity into it. About 4 years ago we considered selling and building on another piece of our property, and at that time we were shocked when the realitor said it was worth 4x what we owed on it.

We are now working on building our own family farm, we are cash flowing it. I have such a disdain for debt that I cant pull myself to get a loan. We decided we would rather grow slowly. We are although at a hard spot, seeing we hate debt, but still have a mortgage hanging over our heads with about 3 years left. I feel at this point it is almost smarter to stop paying extra on the principle due to our under 3% interest rate and re route that extra weve been putting in over the years to our farm.

I feel our society has failed miserably by encouraging consumer dept. If parents taught their kids basic finances and what debt actually is, we'd be in a much better place.
You know what is sad, Credit Card companies prey on college kids knowing their parents will bail them out...I have heard many stories of this happening...even heard they have setup booths at colleges passing cards out like candy...
 

David L

IPCT Contributor
Joined
Aug 2, 2019
Messages
8,031
Reaction score
21,042
Location
USA
For us it is real simple, your retirement years are not when you gamble with your money. We have Nothing in the Stock Market. We ended up buying some CDs at 4-5% which was unheard of prior to this Recession. For liquid assets (cash) we have a Capitol One Savings account paying 3%, also unheard of. So even with us out of the Stock Market, our money is still making money.

My guess is YTD will close this year with a negative. Add 5-7% avg. yearly return to that negative number and you will get your actual loss for the year...

View attachment 148869

Side Note: Don't remember this with CDs in the Past but they now have Recallable CDs, we made sure ours cannot be Called Back they are Protected. This is very common with Bonds, did not know CDs too.
Correction, now making 3.3% :) Started with 1% a few years ago...

1671717656491.png
 
Top