Join Early Retirement Today
Reply
 
Thread Tools Search this Thread Display Modes
Old 07-06-2021, 05:44 AM   #61
Thinks s/he gets paid by the post
 
Join Date: Aug 2012
Posts: 1,452
Quote:
Originally Posted by REWahoo View Post
No reason to think lack of personal financial skills is limited only to the public sector. Our CFO had his car repossessed from the corp HQ parking garage.

Well that is funny.
finnski1 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!

Old 07-06-2021, 05:54 AM   #62
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
donheff's Avatar
 
Join Date: Feb 2006
Location: Washington, DC
Posts: 10,779
Quote:
Originally Posted by marko View Post
I'm sure I'm the outlier here but in 1st grade a lady from the local bank came by and had us open a savings account (likely illegal now...forcing kids to deal with one bank); she also came by each week to collect our nickels to add to our account. (Hi Miss McMahon!)

In 6th grade we were taught how to balance a checkbook. In 7th grade we were taught about compound interest.

In high school we had some guy come in every month or so from an investment house and explain the basics of the stock market (I must have been asleep a lot; witness my questions on this forum!), how to read a balance sheet, inflation, the differences between bonds and stocks etc. We even had an investment club where we played with fake money/investments.

Of course this was a private school.
I may have mentioned it here somewhere but my 11 year old grandson was involved in a fantasy stock club at school (real tickers, fake money). He was good and got hooked so I opened a custodial account at Schwab where he could by and sell stock "slices." He has invested all of his Xmas and birthday cash in the account and done pretty well. Now his younger sisters have accounts and he is their FA. A few weeks back he called to ask if he could walk over to check out his investments (he has to log in to my account to access his so he does his trading here). He added, "I'm stopping at Starbuck's on the way over, can I get you something"? I'm thinking this guy may be my FA when I start going down hill.
__________________
Every man is, or hopes to be, an Idler. -- Samuel Johnson
donheff is offline   Reply With Quote
Old 07-06-2021, 05:58 AM   #63
Moderator
braumeister's Avatar
 
Join Date: Feb 2010
Location: Flyover country
Posts: 21,779
Quote:
Originally Posted by donheff View Post
"I'm stopping at Starbuck's on the way over, can I get you something"? I'm thinking this guy may be my FA when I start going down hill.
Great FA, and he probably sends you a birthday card as well!

How much does he charge?
__________________
I thought growing old would take longer.
braumeister is offline   Reply With Quote
Old 07-06-2021, 06:11 AM   #64
Thinks s/he gets paid by the post
 
Join Date: Aug 2012
Posts: 1,452
Quote:
Originally Posted by donheff View Post
I may have mentioned it here somewhere but my 11 year old grandson was involved in a fantasy stock club at school (real tickers, fake money). He was good and got hooked so I opened a custodial account at Schwab where he could by and sell stock "slices." He has invested all of his Xmas and birthday cash in the account and done pretty well. Now his younger sisters have accounts and he is their FA. A few weeks back he called to ask if he could walk over to check out his investments (he has to log in to my account to access his so he does his trading here). He added, "I'm stopping at Starbuck's on the way over, can I get you something"? I'm thinking this guy may be my FA when I start going down hill.
That's awesome. I like to joke that when I was 11 I could barely tie my own shoes Though I can't remember and hopefully I was able to by then!
finnski1 is offline   Reply With Quote
Old 07-06-2021, 06:13 AM   #65
Thinks s/he gets paid by the post
FIRE'd@51's Avatar
 
Join Date: Aug 2006
Posts: 2,433
Quote:
Originally Posted by Markola View Post
Last night, we had dinner with a friend, whose father was a Goldman Sachs bond trader in Manhattan for 32 years. She grew up with limousines and even helicopters on demand. I know that her privileged upbringing causes less sympathy but she is a hard-working attorney and fully responsible person, whom we love as an amazingly good friend. We always assumed our friend would inherit many millions someday, and she might have assumed that, too. It turns out, she learned last week that her father was essentially wiped out through a margin call last year when the Covid recession struck. Beyond that, she doesn’t know how he was invested. He’s developed depression and other maladies and his remaining assets are being spent down so that he can go on Medicaid! We were shocked and saddened by her story.
I sure would like to hear more details about this story. I doubt that someone who worked at GS for 32 years (and was probably a partner and/or managing director} years was ignorant about personal finance. I would hope your friend continues to try to find out the details of his investments.
__________________
I'd rather be governed by the first one hundred names in the telephone book than the Harvard faculty - William F. Buckley
FIRE'd@51 is offline   Reply With Quote
Old 07-06-2021, 06:31 AM   #66
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
 
Join Date: Nov 2009
Posts: 6,315
Quote:
Originally Posted by marko View Post
I'm sure I'm the outlier here but in 1st grade a lady from the local bank came by and had us open a savings account (likely illegal now...forcing kids to deal with one bank); she also came by each week to collect our nickels to add to our account. (Hi Miss McMahon!)

In 6th grade we were taught how to balance a checkbook. In 7th grade we were taught about compound interest.

In high school we had some guy come in every month or so from an investment house and explain the basics of the stock market (I must have been asleep a lot; witness my questions on this forum!), how to read a balance sheet, inflation, the differences between bonds and stocks etc. We even had an investment club where we played with fake money/investments.

Of course this was a private school.
Besides being an outlier in general, I'm sure I'm an outlier in the personal finance area like you.

I remember as a kid, starting around 10 years old (early 1970s), helping my mom out when she wrote the checks to pay the monthly bills. She had a spiral notebook where she posted the month's payments on a single page. I didn't do much more than seal the envelopes and put an address label on each one, but I gained an understanding on how the process worked. She also showed me how to balance the checkbook. And when tax time came around, I helped her complete the income tax forms, using pencil and paper and maybe a calculator. (I guess this is why I never had any interest in using software programs or hiring a CPA.)

Later on, my mom got me started on investing in mutual funds for my non-retirement money, even if it weren't for anything beyond muni bond funds. I already was investing in my employer's 401k although at the time (late 1980s) they had only 2 funds to choose from (stable value and SP500). I would later branch out into other types of funds.

Sadly, she passed away nearly 26 years ago at age 59, so she never saw the result of the wonderful seeds she planted in me (and she was a home gardener), culminating with my early retirement. She did well in home-schooling a personal finance education in me.
__________________
Retired in late 2008 at age 45. Cashed in company stock, bought a lot of shares in a big bond fund and am living nicely off its dividends. IRA, SS, and a pension await me at age 60 and later. No kids, no debts.

"I want my money working for me instead of me working for my money!"
scrabbler1 is offline   Reply With Quote
Old 07-06-2021, 06:41 AM   #67
Thinks s/he gets paid by the post
 
Join Date: Aug 2012
Posts: 1,452
Quote:
Originally Posted by scrabbler1 View Post
Besides being an outlier in general, I'm sure I'm an outlier in the personal finance area like you.

I remember as a kid, starting around 10 years old (early 1970s), helping my mom out when she wrote the checks to pay the monthly bills. She had a spiral notebook where she posted the month's payments on a single page. I didn't do much more than seal the envelopes and put an address label on each one, but I gained an understanding on how the process worked. She also showed me how to balance the checkbook. And when tax time came around, I helped her complete the income tax forms, using pencil and paper and maybe a calculator. (I guess this is why I never had any interest in using software programs or hiring a CPA.)

Later on, my mom got me started on investing in mutual funds for my non-retirement money, even if it weren't for anything beyond muni bond funds. I already was investing in my employer's 401k although at the time (late 1980s) they had only 2 funds to choose from (stable value and SP500). I would later branch out into other types of funds.

Sadly, she passed away nearly 26 years ago at age 59, so she never saw the result of the wonderful seeds she planted in me (and she was a home gardener), culminating with my early retirement. She did well in home-schooling a personal finance education in me.

Sounds like you had a great mom! 59 is much too young.
finnski1 is offline   Reply With Quote
Personal finance ignorance among the otherwise intelligent
Old 07-06-2021, 08:41 AM   #68
Thinks s/he gets paid by the post
Markola's Avatar
 
Join Date: Nov 2013
Location: Twin Cities
Posts: 3,282
Personal finance ignorance among the otherwise intelligent

Quote:
Originally Posted by RetiredHappy View Post
I know that this forum scoffs at AUM fees that people pay. The good part about legitimate money managers, not Bernie Madoff type, is that people don't lose their entire investments. Whether it is the ignorance or people who want to be one step removed from making knee jerk buy/sell decisions, wealth management would work well for them. As long as the market is up, it is not difficult to pick winners. It is when the market is down, it will separate the people who are good level-headed investors vs. panic sellers. Wealth management companies provide that protection against panic selling - buy high / sell low.

A majority here might scoff but not me. We have AUM with Vanguard Personal Advisory Services for .35% for all sorts of interpersonal reasons and it might be the best money we spend. I view it as, first and foremost, cheap mistake prevention insurance.

Quote:
Originally Posted by FIRE'd@51 View Post
I sure would like to hear more details about this story. I doubt that someone who worked at GS for 32 years (and was probably a partner and/or managing director} years was ignorant about personal finance. I would hope your friend continues to try to find out the details of his investments.

She’s more concerned about her dad than how specifically he lost his shirt, so I felt I could only probe a little bit. On the other hand, it doesn’t really matter. If one buys on margin, they can lose far more than they have bet on even the S&P 500 when it tanks periodically. “Leverage” instantly becomes a crow bar turned back on you.
Markola is offline   Reply With Quote
Old 07-06-2021, 09:44 AM   #69
Thinks s/he gets paid by the post
jollystomper's Avatar
 
Join Date: Apr 2012
Posts: 4,776
My personal observation is that many "educated" people still fall victim to these items:

1)Not thinking long term beyond the next large purchase.
2)Listen more to those who claim they can "beat the market", because, after all, we're smart, we should be able to beat the market, right?
3) Have heard of folks having financial problems but tend to take the "That can't happen to me, I'm too smart for that" attitude vs. the "wow, that could happen to be, what do I do to prevent it" attitude.
4) May be more tempted to push "keep up with the Joneses" for appearances ahead of invisible personal finance basics.

In addition, there are different types of education. For example, "book smarts" vs "street smarts", or "knowledge" versus "wisdom". Not everyone who is smart has street smarts, and not everyone who has knowledge has wisdom .

Sometimes the toughest action, when it comes to personal finances, is to not assume one's "smartness" in other areas maps to personal finance intelligence. At a recent family wedding I was talking to one of my nieces. She is 30, with undergraduate and graduate degrees from Ivy leagues schools and a law degree from a to law school, working for a large law firm and living with her parents while she saves to buy a house. The conversation turned to long term plans, and she mentioned about "I should invest in the market, but it seems so complicated to figure out what to buy". I told her about the basic approach to start simple, using a few broad index funds, dollar cost in, worry about individual stocks much later (if ever)... all of this was new news to her. But she took the "I need to learn more about this" attitude, and enjoyed me showing her the Bogleheads site, so I think the seed was well planted.
__________________
FIREd date: June 26, 2018 - "This Happy Feeling, Going Round and Round!" (GQ)
jollystomper is offline   Reply With Quote
Old 07-06-2021, 09:52 AM   #70
gone traveling
 
Join Date: Dec 2018
Posts: 1,196
In the 1979 Business Week ran an article " The Death of Equities ". How so wrong these writers were.
Nick12 is offline   Reply With Quote
Old 07-06-2021, 10:07 AM   #71
Thinks s/he gets paid by the post
 
Join Date: Sep 2006
Posts: 1,396
I was 18 or 19 years old and planning to buy my first car and I was talking to my uncle about my plans to get a car loan and pay it off as soon as possible because I don't like having loan payments, and he said "That's silly, you should always expect to have a car payment, that's a part of life."

I never forgot that, not because I agreed with him, but because it struck me how he had internalized being in debt as a part of life and it was silly to think about being debt free. I've always made it a point to have as little debt as possible and avoid car payments and I always think about what my uncle said as a counter example of how I do not want to live.
JustCurious is offline   Reply With Quote
Old 07-06-2021, 10:11 AM   #72
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
Amethyst's Avatar
 
Join Date: Dec 2008
Posts: 11,425
If he'd said, "A car payment is part of life," I could see it - just his personal philosophy. Calling you silly for wanting to be different was not very...avuncular! Or kind.

In our family, it was sort of a merit badge to get to where you could pay cash for a car. My parents didn't have much but they avoided debt any way they could.

In fact - I did not want to get a credit card (which I knew was just debt) until somebody explained that, as long as you paid it off every month, it was actually leverage - you could spread out your debt for 2-3 weeks and not pay any interest.

Quote:
Originally Posted by JustCurious View Post
I was 18 or 19 years old and planning to buy my first car and I was talking to my uncle about my plans to get a car loan and pay it off as soon as possible because I don't like having loan payments, and he said "That's silly, you should always expect to have a car payment, that's a part of life."

.
__________________
If you understood everything I say, you'd be me ~ Miles Davis
'There is only one success – to be able to spend your life in your own way.’ Christopher Morley.
Even a blind clock finds an acorn twice a day.
Amethyst is offline   Reply With Quote
Old 07-06-2021, 10:12 AM   #73
gone traveling
 
Join Date: Dec 2018
Posts: 1,196
Quote:
Originally Posted by JustCurious View Post
I was 18 or 19 years old and planning to buy my first car and I was talking to my uncle about my plans to get a car loan and pay it off as soon as possible because I don't like having loan payments, and he said "That's silly, you should always expect to have a car payment, that's a part of life."

I never forgot that, not because I agreed with him, but because it struck me how he had internalized being in debt as a part of life and it was silly to think about being debt free. I've always made it a point to have as little debt as possible and avoid car payments and I always think about what my uncle said as a counter example of how I do not want to live.
The way your uncle described - car payment, part of life etc is a perfect example of what fuels our economy, millions of Americans are slaves to debt.
Nick12 is offline   Reply With Quote
Old 07-06-2021, 10:15 AM   #74
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
 
Join Date: Feb 2013
Posts: 8,827
One of the dads in our area was a financial adviser for one of the big name investment companies. He coached kids sports teams, in part to court the parents as customers. He invited me in once for a free consultation so I went. He charged an annual fee to find the "right" money manager (which I assumed to be one of his golf buddies) for his clients, so he was charging a percent of portfolio annual fee on top of the golf buddy's annual percentage fee. The whole time I listened to his pitch I was just thinking you've got to be kidding me. After the two fees, taxes and inflation there wouldn't be any real portfolio growth, especially factoring in down market years. It seemed like a scam but the guy had a big, fancy office and a nicer house than ours so I assume he was making a good living.

We were kind of shocked to find out someone one of us knew from work in a tech field actually used this guy as her financial adviser and highly recommended his services. I have never understood how people who worked in a logic based field with college degrees would be so gullible to people like this and take so little interest in managing their own finances.
__________________
Even clouds seem bright and breezy, 'Cause the livin' is free and easy, See the rat race in a new way, Like you're wakin' up to a new day (Dr. Tarr and Professor Fether lyrics, Alan Parsons Project, based on an EA Poe story)
daylatedollarshort is online now   Reply With Quote
Personal finance ignorance among the otherwise intelligent
Old 07-06-2021, 10:22 AM   #75
Thinks s/he gets paid by the post
 
Join Date: May 2007
Posts: 1,147
Personal finance ignorance among the otherwise intelligent

Quote:
Originally Posted by ivinsfan View Post
Kind of, but you know live by the sword die by the sword.. a goldman sachs market guy with that kind of margin exposure? Guessing he thought he was smarter then the little guy. How many little guys have GS squashed like a bug while laughing all the way to the bank?


There are so many ways to interpret those unfortunate circumstances that have nothing to do with so called karma. Life is such that anyone of us can have really unfortunate circumstances (even more so if we live a long life). It doesn’t matter if you’re rich, poor, good or bad. It’s just what it is.
Letj is online now   Reply With Quote
Old 07-06-2021, 10:36 AM   #76
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
ivinsfan's Avatar
 
Join Date: Feb 2007
Posts: 9,297
Quote:
Originally Posted by Letj View Post
There are so many ways to interpret those unfortunate circumstances that have nothing to do with so called karma. Life is such that anyone of us can have really unfortunate circumstances (even more so if we live a long life). It doesn’t matter if you’re rich, poor, good or bad. It’s just what it is.
I think I said if you play the game long enough you are going to get burned. But I'm not wrong saying GS didn't mind fleecing the little guys. For the record I don't believe in karma
ivinsfan is online now   Reply With Quote
Old 07-06-2021, 11:37 AM   #77
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
OldShooter's Avatar
 
Join Date: Mar 2017
Location: City
Posts: 8,727
Quote:
Originally Posted by JustCurious View Post
... it struck me how he had internalized being in debt as a part of life and it was silly to think about being debt free. I've always made it a point to have as little debt as possible and avoid car payments ...
In the early 90s I bought DW a car, a kind of hot sedan called a Merkur Scorpio. She was standing in a group at work and mentioned the gift. The response was: "Sure, but who is going to make the payments?" Everyone in the group was astonished when her response was: "There are no payments."

Quote:
Originally Posted by ivinsfan View Post
I think I said if you play the game long enough you are going to get burned. ...
Try Nassim Taleb's "Fooled by Randomness." In it he thoroughly discussed the syndrome where someone gets lucky and from that concludes that they are an investing genius.
__________________
Ignoramus et ignorabimus
OldShooter is offline   Reply With Quote
Old 07-06-2021, 11:40 AM   #78
Full time employment: Posting here.
 
Join Date: Oct 2013
Posts: 745
This thread reminds me of the advice I got from my FIL around 1990 or so after he had heard I was buying S&P 500 mutual fund shares in my 401K. He told me one day, I have great advice for you about the stock market, "GET OUT NOW!".

I later found out that he had received a sizable inheritance in his mid 20's, gave most of it to some broker to "invest" and lost it all on individual risky stocks in about 2 or 3 years.

I nodded to acknowledge what he had said but kept right on investing in low cost mutual funds such as VTSAX inside and outside of the 401K and was able to retire early. He continued working till death.
freedomatlast is offline   Reply With Quote
Old 07-06-2021, 11:59 AM   #79
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
Sunset's Avatar
 
Join Date: Jul 2014
Location: Spending the Kids Inheritance and living in Chicago
Posts: 13,938
Quote:
Originally Posted by Markola View Post
A majority here might scoff but not me. We have AUM with Vanguard Personal Advisory Services for .35% for all sorts of interpersonal reasons and it might be the best money we spend. I view it as, first and foremost, cheap mistake prevention insurance.
.....
I have no issue with AUM of .35% or less, it's when it gets to 2% or more that I want to know why they deserve so much.. and to be upfront about the cost in % and dollars to customers.

The old folks I helped didn't even know they were being charged a fee, it was there on page 35 of an annual statement of about 60 pages
__________________
Fortune favors the prepared mind. ... Louis Pasteur
Sunset is online now   Reply With Quote
Old 07-06-2021, 12:08 PM   #80
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
 
Join Date: Nov 2009
Posts: 6,315
Quote:
Originally Posted by OldShooter View Post
In the early 90s I bought DW a car, a kind of hot sedan called a Merkur Scorpio. She was standing in a group at work and mentioned the gift. The response was: "Sure, but who is going to make the payments?" Everyone in the group was astonished when her response was: "There are no payments."
Car salesmen have always seemed a little surprised when I told them I was paying cash. It's probably because they have one chance to squeeze me for some extra money with the "finance guy" afterward. As with credit cards, I can't conceive of paying interest on those or as part of a car loan.
__________________
Retired in late 2008 at age 45. Cashed in company stock, bought a lot of shares in a big bond fund and am living nicely off its dividends. IRA, SS, and a pension await me at age 60 and later. No kids, no debts.

"I want my money working for me instead of me working for my money!"
scrabbler1 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
Finally! A bright spot in an otherwise gloomy day. chinaco FIRE and Money 19 10-08-2008 01:43 AM
Favorite Charities, holiday time or otherwise? Zoocat Other topics 13 11-27-2007 10:01 PM
Boo Yaaaaaah Cramer Fans and Otherwise JPatrick FIRE and Money 1 10-21-2005 06:46 PM
Any one ER'd or otherwise in Branson? JPatrick Life after FIRE 21 07-06-2005 08:05 AM
Should I invest in VCAIX? Convince me otherwise! ganda FIRE and Money 10 04-28-2004 02:55 PM

» Quick Links

 
All times are GMT -6. The time now is 02:03 PM.
 
Powered by vBulletin® Version 3.8.8 Beta 1
Copyright ©2000 - 2022, vBulletin Solutions, Inc.