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Millionaire Cop next Door : Karlgaard Digital Rules
Old 07-18-2010, 04:00 PM   #1
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Millionaire Cop next Door : Karlgaard Digital Rules

Forbes Magazine article explains the latest batch of millionaires in the USA society
The Millionaire Cop Next Door Digital Rules - Forbes.com
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Old 07-18-2010, 04:48 PM   #2
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Which also brings into the question of the value of any public/private pension plan.

In another article I read today, current average SS benefits are a bit less than $1k/month.

Being generous (hey, it's your money ), let's say it is $1k/mo, or $12k/year.

Using the 4% "magic withdrawl" number (e.g. multiplying $12k * 25 years), we get an initial value of $300k. For a couple, double that to $600k.

Include other retirement income and possibilty for conversion of assets (such as a reverse mortgage), a lot of folks have quite substantial "inferred assets".

It dosen't take away the "sting" of the article, but it does show how Mr/Mrs "Average" also have a bit of inferred wealth.

You don't have to be a public worker to get the benefits of one (however, I still wish I retired from a government job )...
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Old 07-18-2010, 05:03 PM   #3
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Many of my friends are retired cops from NYC and Nassau County on Long Island NY. The NYC cops do OK but the gold is in Nassau County and also Suffolk County out on Long Island. Most of my friends retired 20 years ago at around 41 after 20 years. Most are receiving around 130K a year with a full Cola. Also Medical with dental and eyeglasses and death benefits. These pensions can also be extended to the spouse. If they live for another 40 years can you imagine how much $ this is worth.

That's why people are paying 20K in taxes on a small Cape Cod home with maybe 70X100 property. How much longer can this go on?
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Old 07-18-2010, 09:57 PM   #4
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Originally Posted by rescueme View Post
Include other retirement income and possibilty for conversion of assets (such as a reverse mortgage), a lot of folks have quite substantial "inferred assets".

It dosen't take away the "sting" of the article, but it does show how Mr/Mrs "Average" also have a bit of inferred wealth.
Good point, these articles never seem to do a very good job of apples-to-apples. But I suspect that is because accuracy would weaken the punch of the headline.

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Old 07-19-2010, 06:07 AM   #5
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Old 07-19-2010, 09:41 AM   #6
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Good point, these articles never seem to do a very good job of apples-to-apples. But I suspect that is because accuracy would weaken the punch of the headline.

-ERD50

Except that a number of these people are also eligible for SS... the pension is the only difference...

And if they do not have SS... they did not pay for it either... that is a lot of money at 15%...
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Old 07-19-2010, 09:47 AM   #7
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Except that a number of these people are also eligible for SS... the pension is the only difference...

And if they do not have SS... they did not pay for it either... that is a lot of money at 15%...
You are right. It ALL needs to be taken into account. Too much work for a journalist, I guess. Hmmm, I might start another thread on that....

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Old 07-19-2010, 10:14 AM   #8
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Except that a number of these people are also eligible for SS... the pension is the only difference...
That's a rather huge difference, wouldn't you say?
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Old 07-19-2010, 04:22 PM   #9
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I can't think of too many weeks that went by in which someone didn't remark to me, "I wouldn't do your job for a million dollars."

Turns out I was.
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Old 07-19-2010, 05:14 PM   #10
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I can't think of too many weeks that went by in which someone didn't remark to me, "I wouldn't do your job for a million dollars."

Turns out I was.

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and....
Old 07-19-2010, 05:19 PM   #11
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and....

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Originally Posted by rescueme View Post
Which also brings into the question of the value of any public/private pension plan.

In another article I read today, current average SS benefits are a bit less than $1k/month.

Being generous (hey, it's your money ), let's say it is $1k/mo, or $12k/year.

Using the 4% "magic withdrawl" number (e.g. multiplying $12k * 25 years), we get an initial value of $300k. For a couple, double that to $600k.

Include other retirement income and possibilty for conversion of assets (such as a reverse mortgage), a lot of folks have quite substantial "inferred assets".

It dosen't take away the "sting" of the article, but it does show how Mr/Mrs "Average" also have a bit of inferred wealth.

You don't have to be a public worker to get the benefits of one (however, I still wish I retired from a government job )...
that same cop has social security as well!
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Old 07-19-2010, 05:30 PM   #12
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That's a rather huge difference, wouldn't you say?

Sure... but I was pointing out that it really was more of an apples to apples comparison... SS is either part of the person package and they paid into it like we did... or it is not... and they did not pay into it...


What someone needs to do is calculate how much was contributed by the employee and then calculate the true value of the pension above that amount.
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Old 07-19-2010, 06:23 PM   #13
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that same cop has social security as well!
Ok - then he is the multi-millionaire next door ...
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Old 07-20-2010, 04:57 PM   #14
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That article is funny. It uses a cop's salary from a high paying area. Far from a realistic example. If I had stayed with either of my local agencies I would have made 15k or 20k in pension depending on the agency. In my current federal gig, I can expect to make about 40k (including military time purchased) in pension after 30 years on the clock. Of course that is not including social security or TSP. I'm not complaining, just saying I'm far below the 80k in pension.
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