Join Early Retirement Today
Reply
 
Thread Tools Search this Thread Display Modes
Greetings (from Ireland)
Old 03-24-2005, 03:13 PM   #1
Recycles dryer sheets
 
Join Date: Mar 2005
Posts: 90
Greetings (from Ireland)

Greetings. Chanced upon site, seems to be genuinely nice (and clever) folks here.

From Ireland, but work and live in Europe & US (IL). Work is Derivatives Trading/IT. Have only cheap hobbies: Music (2CD's), Film (a few short scripts).
Areas researching at the moment :-

Q1. Good time to convert Euro assets to US$ or not?
(Long-term outlook for US and the dollar?)

Q2. Tax haven work, anyone ever ventured?

Q3. ER income from Real-Estate or Equities?
(The numbers appear close 3.5% rental yields vs ~4% Fund SWR, but which is safer/better re: Q4.)

Q4. Lifesavings secure in Funds after Worldcon/Enrot/Equitable Life?

Q5. House price correction risk as rates go up?

Q6. ER to Canada or US?

Q7. Prop arbitrage i.e. buy a home now in CA (>20% apprec), and sell home in IL (<8% apprec)?

Q8. Easily locking in FX rates. Read the posts but this still seems a tricky area . . .

Q9. Trading / mgt their own portfolios / Assets?
__________________

__________________
1.Convert Euro assets to US$ now or not?<br />2.Tax haven work, anyone ventured?<br />3.ER income from Real-Estate or Equities?<br />4.ER to Canada or US?<br />5.Lifesavings secure in Funds after Worldcon/Enrot/Equitable Life?<br />6.House price correction risk as rates go up?<br />7.Prop arbitrage i.e. CA &gt; 20% IL&lt;8%?
ER@40 is offline   Reply With Quote
Join the #1 Early Retirement and Financial Independence Forum Today - It's Totally Free!

Are you planning to be financially independent as early as possible so you can live life on your own terms? Discuss successful investing strategies, asset allocation models, tax strategies and other related topics in our online forum community. Our members range from young folks just starting their journey to financial independence, military retirees and even multimillionaires. No matter where you fit in you'll find that Early-Retirement.org is a great community to join. Best of all it's totally FREE!

You are currently viewing our boards as a guest so you have limited access to our community. Please take the time to register and you will gain a lot of great new features including; the ability to participate in discussions, network with our members, see fewer ads, upload photographs, create a retirement blog, send private messages and so much, much more!

Re: Greetings (from Ireland)
Old 03-24-2005, 03:56 PM   #2
Recycles dryer sheets
 
Join Date: Jul 2002
Posts: 420
Re: Greetings (from Ireland)

Welcome onboard!
1. no clue
2. I live and work abroad - currently Caribbean.
3. i own 2 apts - think can be good part of diversified portfolio
4. prefer index funds - but fine with both kinds
5. no clue
6. not considered - gotta be warm though 8)
7. can make good sense - sell overvalued if know it is
8. no clue
9. after some studying and if interest is there there is a lot of money that can saved by DIY. If no knowledge or interest a well diversified fund might be best choice
Cheers!


Quote:
Greetings. Chanced upon site, seems to be genuinely nice (and clever) folks here.

From Ireland, but work and live in Europe & US (IL). Work is Derivatives Trading/IT. Have only cheap hobbies: Music (2CD's), Film (a few short scripts).
Areas researching at the moment :-

Q1. Good time to convert Euro assets to US$ or not? *
(Long-term outlook for US and the dollar?)

Q2. Tax haven work, anyone ever ventured?

Q3. ER income from Real-Estate or Equities? *
(The numbers appear close 3.5% rental yields vs ~4% Fund SWR, but which is safer/better re: Q4.)

Q4. Lifesavings secure in Funds after *Worldcon/Enrot/Equitable Life?

Q5. House price correction risk as rates go up?

Q6. ER to Canada or US?

Q7. Prop arbitrage i.e. buy a home now in CA (>20% apprec), and sell home in IL (<8% apprec)?

Q8. Easily locking in FX rates. Read the posts but this still seems a tricky area . . .

Q9. Trading / mgt their own portfolios / Assets?
__________________

__________________
preben is offline   Reply With Quote
Re: Greetings (from Ireland)
Old 03-24-2005, 05:50 PM   #3
Recycles dryer sheets
 
Join Date: Mar 2005
Posts: 90
Re: Greetings (from Ireland)

Quote:
Welcome,

What part of Ireland are you from? I visited there about 15 years ago. Spent a couple weeks in Western Ireland - Connemara - Just beautiful. Consumed lots of Guiness and great food!
Hi Cut-Throat,
Couldn't agree more, a really nice part of Ireland. I go regularly myself. The west is always great for holidays. Though it helps when that bright object in the sky comes out too!

I hail from the other side - a mountainy area of Wicklow. But The Guinness is good here too, as it is in many major cities in the US now remarkably. Even many neighborhood bars seem to have good Guinness Ė sometimes Technology really is great!

__________________
1.Convert Euro assets to US$ now or not?<br />2.Tax haven work, anyone ventured?<br />3.ER income from Real-Estate or Equities?<br />4.ER to Canada or US?<br />5.Lifesavings secure in Funds after Worldcon/Enrot/Equitable Life?<br />6.House price correction risk as rates go up?<br />7.Prop arbitrage i.e. CA &gt; 20% IL&lt;8%?
ER@40 is offline   Reply With Quote
Re: Greetings (from Ireland)
Old 03-24-2005, 05:52 PM   #4
Recycles dryer sheets
 
Join Date: Mar 2005
Posts: 90
Re: Greetings (from Ireland)

Quote:
Welcome onboard!
2. I live and work abroad - currently Caribbean.
3. i own 2 apts - think can be good part of diversified portfolio
4. prefer index funds - but fine with both kinds
6. not considered - gotta be warm though 8)
7. can make good sense - sell overvalued if know it is
9. after some studying and if interest is there there is a lot of money that can saved by DIY. If no knowledge or interest a well diversified fund might be best choice
Cheers!
Hi Ben. Thanks for your views
__________________
1.Convert Euro assets to US$ now or not?<br />2.Tax haven work, anyone ventured?<br />3.ER income from Real-Estate or Equities?<br />4.ER to Canada or US?<br />5.Lifesavings secure in Funds after Worldcon/Enrot/Equitable Life?<br />6.House price correction risk as rates go up?<br />7.Prop arbitrage i.e. CA &gt; 20% IL&lt;8%?
ER@40 is offline   Reply With Quote
Re: Greetings (from Ireland)
Old 03-24-2005, 06:55 PM   #5
Recycles dryer sheets
 
Join Date: Mar 2005
Posts: 90
Re: Greetings (from Ireland)

Quote:
Welcome onboard!
2. I live and work abroad - currently Caribbean.
To Ben:
Working in havens is always interesting, could you tell us a little about your stay in the Caribbean? How you went about locating work maybe, and about the transition to the locale?
__________________
1.Convert Euro assets to US$ now or not?<br />2.Tax haven work, anyone ventured?<br />3.ER income from Real-Estate or Equities?<br />4.ER to Canada or US?<br />5.Lifesavings secure in Funds after Worldcon/Enrot/Equitable Life?<br />6.House price correction risk as rates go up?<br />7.Prop arbitrage i.e. CA &gt; 20% IL&lt;8%?
ER@40 is offline   Reply With Quote
Re: Greetings (from Ireland)
Old 03-25-2005, 08:08 AM   #6
Recycles dryer sheets
 
Join Date: Jul 2002
Posts: 420
Re: Greetings (from Ireland)

Been working for a global fortune 500 so have been posted here. No problem getting used to locale - I have done it so many time before. Cheers!
__________________
preben is offline   Reply With Quote
Re: Greetings (from Ireland)
Old 03-25-2005, 05:36 PM   #7
Recycles dryer sheets
 
Join Date: Nov 2004
Posts: 123
Re: Greetings (from Ireland)

ER@40:
Welcome. *I'm pretty new myself but glad to see that Ben answered all your questions (?)!

I am planning to retire early next year or late this year at 45. *Need to get in another trip to Ireland soon. *We've visited several times and did a bicycle vacation along the western coast. *Had a great time...at the end of the day we'd cycle in to whatever town and just find a b&b and a pub. *No planning...it was a blast as long as you didn't mind a little rain.

I haven't followed but seems like the real estate market is booming in Ireland, or at least what I've read lately about Dublin?
__________________
You can either take action, or you can wait for a miracle. Miracles are<br />great, but they are so unpredictable.<br />(Peter Drucker)
kayelem is offline   Reply With Quote
Re: Greetings (from Ireland)
Old 03-25-2005, 06:36 PM   #8
Recycles dryer sheets
 
Join Date: Mar 2005
Posts: 90
Re: Greetings (from Ireland)

Hi kayelem, bicycling trips are always fun, watch out for those steep hills though! Yes its true - a property explosion tied to rapid economic growth nicknamed the 'Celtic Tiger'.

If you bought a house in Dublin 10 years ago chances are its more than trebled in value. GD-ER's caution is interesting, as prices are slowing and people are wondering if a market correction will occur.

You see we were mostly mortgage and credit card virgins before the 90's. It was the banks that were risk averse, you couldn't get a loan. Access to cheap money has changed all that, and as 2/3rd's of any economy is typically consumer spending, the economy basically expanded because we all leveraged ourselves up the kazoo. It'll be interesting to see how we cope . . .
__________________
1.Convert Euro assets to US$ now or not?<br />2.Tax haven work, anyone ventured?<br />3.ER income from Real-Estate or Equities?<br />4.ER to Canada or US?<br />5.Lifesavings secure in Funds after Worldcon/Enrot/Equitable Life?<br />6.House price correction risk as rates go up?<br />7.Prop arbitrage i.e. CA &gt; 20% IL&lt;8%?
ER@40 is offline   Reply With Quote
Re: Greetings (from Ireland)
Old 03-26-2005, 04:36 AM   #9
Thinks s/he gets paid by the post
MooreBonds's Avatar
 
Join Date: Aug 2004
Location: St. Louis
Posts: 1,855
Re: Greetings (from Ireland)

Quote:
From Ireland, but work and live in Europe & US (IL). Work is Derivatives Trading/IT.
Welcome to the board.

Here are my opinions (from a 28 year old, so take it for what it's worth):

Q1: Convert it all. Sure, people can make arguments about long-term trends of US trade deficits, etc., but the same could be said about potential stagnant growth in Europe with the Euro, which could effect the Euro's strength. I'm the very conservative type, and if I were in your shoes looking at a roughly 1.25:1 exchange rate, AND you were planning on living in the US for the rest of your life, I'd take the money and run. After all, if you're in the US for the long-term, you WILL have to convert it eventually. Why not go ahead and eliminate your currency risk now? If you don't, you will have to add currency risk among the interest rate, market, systemic, and a whole boatload of other risks that you may or may not be able to diversify against. OTOH, if you're planning on living 6 months/year in Ireland the rest of your life, then leaving a good stash in Euros makes sense.

Q2: No idea. Ask a tax lawyer/accountant. Are you mainly asking about if the tax-havens are as good as people say they are? Just be careful about where your official citizenship is - I have no idea how the IRS views income-earners in tax havens if they're still officially US citizens.

Q3: If you're looking at 3.5% rental yields, and really want to get into real estate, I suppose you could. I've done business with FISN.com (a CD broker), and they offer oustanding rates on callable FDIC insured CDs (6%). Sure, the CDs are callable, but even if you get called after 6 months or 1 year, you still get a pretty good rate (they also have multiple other CD yield options, ranging from flat-rates to step-up CDs). Also don't forget www.penfed.org for the Pentagon Credit Union and your local credit unions for great rates on FSLIC (Federal Savings & Loan Insurance Corp) insured CDs.

Q4: Not sure of your question. Being the conservative type (similar to JG), I'd rather have the (relatively) guaranteed fixed income cash flow, so I stick with that area mostly.

Q5. You mentioned that you are fairly low-maintenance. I'd pick a nice but reasonable (i.e. non-McMansion) house in a nice area at the lower-end of the market. That way, if prices do tumble, a lower-priced house has lower absolute dollars to drop (also, percentage decline might be less than the McMansions, as people leave the McMansions for cheaper homes that they should have bought in the first place).

Q6: That has had several threads in its own. Pluses for Canada are health care (although there are residency and even 'buy-in' requirements that I'm not sure about). Given what you've mentioned so far, I'd be more concerned with what activities you're planning on and the areas you want to be in at this point. Take a few trips in Canada and in various parts of the US to start working up a short list.

Q7: House arbing...well, see my earlier answer about me being 'risk-averse' ...I managed to avoid investing at the top of the internet bubble because I kept telling myself "As soon as I pay 450x future earnings, the market will drop". While there are many pros/cons about housing prices, I'd suggest picking a house you would be happy to live in, in the event of house price stagnation/drops...unless you really like to take risks/gambles.

Q8: Everbank.com is one bank that offers foreign currency-based CDs and other similar instruments that can offer some foreign currency exposure. I don't know of many others. See if any of their offerings are what you're looking for.

Q9: I, personally, will never lose the "control over my own money" thing, and would never give a majority of my assets to other managers (I do have a large minority of my assets in municipal and a few stock/REIT ETFs, but a majority is under my direct management). If you have enough capital and a low enough income requirement, there shouldn't be enough of a problem doing it yourself, especially if you are interested/willing to go mainly fixed-income (once you set up a fixed income plan and execute it, you don't need to check prices on your bonds/cds/mutual funds, etc. every day - just withdraw the money from your MM account and have fun! ). While we're a minority, there are a few of us on the board that prefer a majority fixed-income investment strategy (both those already ER and us youngins).
__________________
Dryer sheets Schmyer sheets
MooreBonds is offline   Reply With Quote
Re: Greetings (from Ireland)
Old 03-26-2005, 05:53 AM   #10
Recycles dryer sheets
 
Join Date: Jul 2002
Posts: 420
Re: Greetings (from Ireland)

Good points peter!
As for your last point I see no problem in somebody having a mainly fixed income strategy - only problem is that for many of us that will not give enough income to live of...
Cheers!
__________________
preben is offline   Reply With Quote
Re: Greetings (from Ireland)
Old 03-26-2005, 05:58 AM   #11
Thinks s/he gets paid by the post
 
Join Date: Dec 2002
Posts: 3,875
Re: Greetings (from Ireland)

Peter is a smart guy. Excellent post!

JG
__________________
MRGALT2U is offline   Reply With Quote
Re: Greetings (from Ireland)
Old 03-27-2005, 12:35 AM   #12
Recycles dryer sheets
 
Join Date: Mar 2005
Posts: 90
Re: Greetings (from Ireland)

Really great post Peter, thanks for taking the time. Bonus Karma Guinness credits! Its really great to have a strong fixed income perspective. Iím funds challenged, lack of disclosure, industry jargon, fine print and weasel clauses - defeat me. Therefore very reliant on fixed income to reach ER.

6% CDís look great, 4% plus inflation cover. But with accelerated Fed rate increases lurking, what are your preferred approaches in protecting your capital?

__________________
1.Convert Euro assets to US$ now or not?<br />2.Tax haven work, anyone ventured?<br />3.ER income from Real-Estate or Equities?<br />4.ER to Canada or US?<br />5.Lifesavings secure in Funds after Worldcon/Enrot/Equitable Life?<br />6.House price correction risk as rates go up?<br />7.Prop arbitrage i.e. CA &gt; 20% IL&lt;8%?
ER@40 is offline   Reply With Quote
Re: Greetings (from Ireland)
Old 03-27-2005, 01:56 AM   #13
Thinks s/he gets paid by the post
 
Join Date: Dec 2002
Posts: 3,875
Re: Greetings (from Ireland)

I would love some 6% CDs. I am taking too much risk
for the extra 1% to 1.5%. This is what I refer to as the missing rungs in my "bond/CD ladder. OTOH, holding 50% in real estate gives me adequate diversification
and inflation protection. We could live on 6% from the
fixed income investments. Along with the real estate
and SS in sight, things look good right now. All things
considered, ER worked out much better than I envisioned it
when the idea hit me in 1992. OF course, things could still go to hell, just like life it's own self

JG
__________________
MRGALT2U is offline   Reply With Quote
Re: Greetings (from Ireland)
Old 03-29-2005, 05:27 AM   #14
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
brewer12345's Avatar
 
Join Date: Mar 2003
Posts: 15,890
Re: Greetings (from Ireland)

I guess the big things we don't know are what your current distribution of assets/currencies is and how long you have until ER. Having said that:

1. Maybe. I personally find it very difficult to do more than a blind guess on the direction of currencies at this point. The USD is no longer wildly overvalued. The Euro has backed off its high. The Fed seems to be getting off its butt and doing something finally. If you are over-exposed to the Euro, I'd probably move some of your exposure to USD, but I wouldn't go whole hog. Diversification makes sense here.

2. No clue.

3. RE markets in the US look pretty generously valued on the coasts. Maybe some markets that have not been inflated (Midwest) would be OK. I would suggest that you not make a big bet on RE right now, especially if you have little or no experience.

4. Funds are safe, especially index funds run by Fidelity, Vanguard, etc. Skullduggery by managers of index funds is extremely unlikely. Having said that, you had better be comfy with the underlying asset class (bonds, equities, whatever). Given your apparent lack of risk tolerance, a balanced fund like Wellington or Wellesley might be a good choice.

5. Very possibly, but it depends on what else is going on in the local market. All RE markets are local, so a particular market might do great while another market explodes.

6. I think that's a matter of personal preference. Seems like you could have a good time in either country.

7. Problem with that idea is that if you are not actually living in the home you have A) the PITA of being an absentee LL and B) a lot of exposure to a volatile bubble market. Buy a home where you want and can afford to live. Housing markets are sufficiently illiquid that you probably don't want to be trying to set up an arbitrage.

8. Dunno what to tell you. Assuming you are diversified by asset class and currency, I think you'd have to have a real good reason to want to lock anything in.

9. I think this depends on your own inclinations, abilities and available time. I personally manage the US stock portion of my portfolio because I believe I have an edge doing so (then again, I am a financial analyst by trade). I know squat about managing commodities or non-US stocks or non-US bonds, so I use the lowest cost, most diversified vehicles I can find to get exposure to these asset classes. I don't hold a lot of US fixed income, but I typically shop for the highest yielding, lowest penalty 5 year CDs I can find, since the rewards for accepting credit risk are currently pretty low. Others do things differently.

__________________
"Neither my companion or I carry firearms on our persons. We depend on the goodwill of our fellow man and the forbearance of reptiles."


- English Bob
brewer12345 is offline   Reply With Quote
Re: Greetings (from Ireland)
Old 03-29-2005, 07:49 AM   #15
Recycles dryer sheets
 
Join Date: Mar 2005
Posts: 90
Re: Greetings (from Ireland)

Quote:
I guess the big things we don't know are what your current distribution of assets/currencies is and how long you have until ER . . .
Hi brewer12345.
Many thanks for your perspective.
__________________

__________________
1.Convert Euro assets to US$ now or not?<br />2.Tax haven work, anyone ventured?<br />3.ER income from Real-Estate or Equities?<br />4.ER to Canada or US?<br />5.Lifesavings secure in Funds after Worldcon/Enrot/Equitable Life?<br />6.House price correction risk as rates go up?<br />7.Prop arbitrage i.e. CA &gt; 20% IL&lt;8%?
ER@40 is offline   Reply With Quote
Reply


Currently Active Users Viewing This Thread: 1 (0 members and 1 guests)
 
Thread Tools Search this Thread
Search this Thread:

Advanced Search
Display Modes

Posting Rules
You may not post new threads
You may not post replies
You may not post attachments
You may not edit your posts

BB code is On
Smilies are On
[IMG] code is On
HTML code is Off
Trackbacks are Off
Pingbacks are Off
Refbacks are Off


Similar Threads
Thread Thread Starter Forum Replies Last Post
ER in Rural Ireland? ESRBob Life after FIRE 30 06-01-2005 11:29 AM

 

 
All times are GMT -6. The time now is 01:02 PM.
 
Powered by vBulletin® Version 3.8.8 Beta 1
Copyright ©2000 - 2016, vBulletin Solutions, Inc.