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Old 02-22-2011, 12:16 PM   #21
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I don't mean to pry, but it's relevant to the discussion: Why doesn't your wife work? Is it because you have children, is it for medical reasons, is she in school, unable to find a job, just plain doesn't want to ... ?

If the plan is for her to become employed and contribute to the household, then it's really just a temporary speed bump. But if she's never going to enter the workforce, then that could seriously impede your progress.

Your goal is certainly achievable, but there are several big mistakes young people make that can easily derail them. Avoid making these mistakes, and you should be fine:
  1. Have kids
  2. Buy a bigger house than you need
  3. Get divorced
  4. Make a habit of buying/leasing new cars
  5. Get sick/have a major accident without insurance

Dodge those bullets and it should be a cakewalk.
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Old 02-22-2011, 12:17 PM   #22
Confused about dryer sheets
 
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I'm no expert but there's some simple tools to commit to memory. One of my earliest revelations about doubling my money was the "Rule of 72's" If you want to know what the yield and term needs to be to "double your money" take factors from 72. Say you want your investment principle to "double" in 12 years? Then it needs to yield 6%, the reverse is also true. Double in 8 yrs? 9%. Now you'll want to keep adding to your investment so as to take advantage of compounding.

This is just a simple tool. Take a look at free online financial calculators like www.timevalue.com under the investment tab, they've even got a calculator to show what it takes to reach $1 milllion. Personally I like Vanguard Targeted Retirement Funds myself. They reduce risk automatically and shift your portfolio to more secure products as you near retirement ( as is conventional wisdom ) so you won't risk everything when you need it most. Good no-load & low expenses too.

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Old 02-22-2011, 04:34 PM   #23
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While I will say having kids increases our expenses, I'm not sure all kids are considered in the list of "big mistakes". IMHO

One can say, stay single or if you're married, go get a divorce early into the marriage before kids and/or obtaining any wealth.... just saying

Quote:
Originally Posted by kombat View Post
Your goal is certainly achievable, but there are several big mistakes young people make that can easily derail them. Avoid making these mistakes, and you should be fine:
  1. Have kids
  2. Buy a bigger house than you need
  3. Get divorced
  4. Make a habit of buying/leasing new cars
  5. Get sick/have a major accident without insurance
Dodge those bullets and it should be a cakewalk.
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Old 02-22-2011, 06:03 PM   #24
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Quote:
Originally Posted by NoEZmoney View Post
.... Take a look at free online financial calculators like www.timevalue.com under the investment tab, they've even got a calculator to show what it takes to reach $1 milllion. ...
I didn't see an investment tab on that website (maybe they redesigned the site?)--but I found about 50 free online calculators under the Products tab and then the TCalc link, including the one you mention: Millionaire Calculator: How can I save a million dollars?
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Old 02-23-2011, 06:46 PM   #25
Confused about dryer sheets
 
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I didn't read through the posts, so apologies if I repeat something already said. Disclaimer: I'm not an investment advisor and I don't play one on TV.

I give this advice repeatedly and it's worked for me; invest in China, invest in anything China needs, investment in any company that has what China needs. In your lifetime, they'll be the number one growth engine for the world economy. They've already passed Japan to become the number two economy. We're the only larger one.

There are over a billion consumers in China who want to bypass the 20th century altogether and come straight into the 21st. At a point in the not too distant future, the Chinese economy will be able to decouple from the rest of the planet and sustain itself on domestic demand.

Their economy is relatively (I said relatively) quiet right now, and that makes it a good time to get in before it ramps up again. Yes, I took my own advice.

Good luck.
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Old 02-23-2011, 09:48 PM   #26
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Open up a spreadsheet and figure it out. If you don't pay any taxes from your savings (ie. you use other earned funds for taxes), increase your savings every year by 3%, and assume a 7% rate of return - you'll get to $1M at age 60 if you start with $5000 savings this year.

But like others have said - to have the purchase power of $1M today, you'll need $2.36M by age 60.

Spreadsheets are fun! They save you from going out and spending your hard earned money.
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