Join Early Retirement Today
Reply
 
Thread Tools Search this Thread Display Modes
Old 07-10-2021, 06:23 AM   #161
gone traveling
 
Join Date: Aug 2020
Posts: 682
Quote:
Originally Posted by Dtail View Post
I will agree that typically having debt in retirement might not be a good idea.
We are mortgage free, but with current mortgage rates there are folks on this site who feel they could earn more money in the markets than what they are paying on their mortgage loan.
There are UHNW people in my circle, very high financial acumen, who have mortgaged their principal dwelling to deploy capital in the market. They can squash the mortgage like a bug if there ever was a need to do so. It's a small piece of their net worth. They aren't retired.

Mortgage debt for the sake of deploying capital in the market is a legitimate and low risk strategy if the mortgage is a low percentage of net worth, for retired or not retired people. If a person has a 1% withdrawal rate on their net worth, and the withdrawal rate and net worth account for the mortgage balance and payment, the mortgage is simply a means to and end - capital growth.
chassis 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 07-10-2021, 06:31 AM   #162
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
audreyh1's Avatar
 
Join Date: Jan 2006
Location: Rio Grande Valley
Posts: 32,337
Quote:
Originally Posted by eleighj416 View Post
“Debt Free” is foreign term to the vast majority of people! I am amazed at the number of people who retire while still having a mortgage over their head.
It is not a requirement to retire with no mortgage. That can be a perfectly rational decision and not something dire “hanging over their head”. If annual retirement cash flow let’s them easily pay the mortgage then it’s a perfectly good option and probably taken because the mortgage rate is super low.
__________________
Retired since summer 1999.
audreyh1 is online now   Reply With Quote
Old 07-10-2021, 07:53 AM   #163
Recycles dryer sheets
 
Join Date: Jul 2012
Posts: 128
I know this thread is about people who are clueless about finances, but I thought some might be interested in how I came to investing. Early in my career I moved far away for a job. I was friendly with the people in my apartment complex and one who was a fellow educator invited me in for a discussion. She showed me her 403b statement and explained how it worked. She recommended I start one with my first paycheck. Later at the new employee workshop on benefits, they passed out the particulars on the 403b and a speaker explained the details. I read everything. I asked the people I worked with about it. One said “I don’t earn enough to contribute.” Another much older teacher took me aside later and encouraged me to participate. She brought her statement to show me and she had a tidy sum in it. I signed up the next day and contributed every paycheck for thirty years. As I received raises, I would increase the contribution. I became interested in personal finance and read many books. Now, many years later, I have far more money than I ever thought possible. I thank my lucky stars that that neighbor talked to me. Sometimes a chance encounter can make a huge impact, but one does have to be receptive and take action.
healthyandfun is offline   Reply With Quote
Old 07-10-2021, 08:12 AM   #164
Full time employment: Posting here.
ProspectiveBum's Avatar
 
Join Date: Sep 2006
Location: SoCal
Posts: 896
Quote:
Originally Posted by audreyh1 View Post
It is not a requirement to retire with no mortgage. That can be a perfectly rational decision and not something dire “hanging over their head”. If annual retirement cash flow let’s them easily pay the mortgage then it’s a perfectly good option and probably taken because the mortgage rate is super low.
I recall that long-time poster Nords, who with his DW had 2 military pensions, was an advocate of this approach.
__________________
I can't complain, but sometimes I still do.
- Joe Walsh
ProspectiveBum is offline   Reply With Quote
Old 07-10-2021, 08:19 AM   #165
gone traveling
 
Join Date: Aug 2020
Posts: 682
Quote:
Originally Posted by healthyandfun View Post
I know this thread is about people who are clueless about finances, but I thought some might be interested in how I came to investing. Early in my career I moved far away for a job. I was friendly with the people in my apartment complex and one who was a fellow educator invited me in for a discussion. She showed me her 403b statement and explained how it worked. She recommended I start one with my first paycheck. Later at the new employee workshop on benefits, they passed out the particulars on the 403b and a speaker explained the details. I read everything. I asked the people I worked with about it. One said “I don’t earn enough to contribute.” Another much older teacher took me aside later and encouraged me to participate. She brought her statement to show me and she had a tidy sum in it. I signed up the next day and contributed every paycheck for thirty years. As I received raises, I would increase the contribution. I became interested in personal finance and read many books. Now, many years later, I have far more money than I ever thought possible. I thank my lucky stars that that neighbor talked to me. Sometimes a chance encounter can make a huge impact, but one does have to be receptive and take action.
@healthyandfun That's a great story, thanks for sharing it.
chassis is offline   Reply With Quote
Old 07-10-2021, 09:26 AM   #166
Thinks s/he gets paid by the post
HawkeyeNFO's Avatar
 
Join Date: Jan 2010
Location: 5-sided building
Posts: 1,009
Quote:
Originally Posted by JRon View Post
Years ago I went to a conference with 2 doctors I worked with (I was in Admin) - both were very intelligent and very nice men, not ego-maniacs. One night at dinner they talked to each other about investments, what they were doing and what others had told them to do. Not once did they include me in their conversation. I’m guessing they assumed I couldn’t add anything and didn’t have any money.

I knew about what they made and I made only about $10,000 less than them, but my expenses were far less. I just listened and by the end of dinner I realized I knew more than they did about investing and had more money than they did. I just smiled and ordered another beer.
That Sir, is AWESOME!
HawkeyeNFO is offline   Reply With Quote
Old 07-10-2021, 09:31 AM   #167
Thinks s/he gets paid by the post
HawkeyeNFO's Avatar
 
Join Date: Jan 2010
Location: 5-sided building
Posts: 1,009
Quote:
Originally Posted by RobbieB View Post
Bad news is good news.
HawkeyeNFO is offline   Reply With Quote
Old 07-10-2021, 09:38 AM   #168
Full time employment: Posting here.
 
Join Date: Mar 2004
Posts: 503
The discussion has veered from our financial educations, but mine is a little different. I am in my 60s, and was raised by Depression kids who well remembered Grandpa being out of a job for years, raising their own food and fishing, and making do. They were extremely frugal.



My dad had a job at the American Bankers Association, and on the side he wrote a personal finance column and later, the Time-Life Book of Family Finance. In 8th grade I learned to type, and began typing his columns to earn a little spending money. I learned about the advantages of mutual funds over individual stocks, the value of compound interest, and of LBYM.



Such a valuable junior high (and entire childhood) experience!
trumpeting_angel is offline   Reply With Quote
Old 07-10-2021, 10:14 AM   #169
Full time employment: Posting here.
 
Join Date: Jul 2011
Location: Reading, MA
Posts: 866
Quote:
Originally Posted by eleighj416 View Post
“Debt Free” is foreign term to the vast majority of people! I am amazed at the number of people who retire while still having a mortgage over their head.
I did, due to divorce in my late 40s.
But it was a modest amount, re-fied at around 3.5%.
My payment was less than $1000/month but I always paid a nice round $1000/month to reduce principal a bit faster.

This allowed me to keep lots of old and new money in investments, which gained lots more than 3.5% most years.

Then after 5-6 years of retirement, poof, that mortgage was paid off. That was around 2018.
So I effectively got a $1000/month increase in my retirement income at that point.
That was a nice inflation fighting boost...
TheWizard is offline   Reply With Quote
Old 07-10-2021, 10:20 AM   #170
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
audreyh1's Avatar
 
Join Date: Jan 2006
Location: Rio Grande Valley
Posts: 32,337
Quote:
Originally Posted by trumpeting_angel View Post
The discussion has veered from our financial educations, but mine is a little different. I am in my 60s, and was raised by Depression kids who well remembered Grandpa being out of a job for years, raising their own food and fishing, and making do. They were extremely frugal.

My dad had a job at the American Bankers Association, and on the side he wrote a personal finance column and later, the Time-Life Book of Family Finance. In 8th grade I learned to type, and began typing his columns to earn a little spending money. I learned about the advantages of mutual funds over individual stocks, the value of compound interest, and of LBYM.

Such a valuable junior high (and entire childhood) experience!
That is very cool!
__________________
Retired since summer 1999.
audreyh1 is online now   Reply With Quote
Old 07-10-2021, 10:30 AM   #171
Thinks s/he gets paid by the post
 
Join Date: Feb 2016
Location: SoCal
Posts: 1,142
Quote:
Originally Posted by Dtail View Post
Bolded by me - Hey there, men (me) also like gardening. lol I know it was just an example.
Yes, your example is correct. I have spent a lot of time invested in learning about gardening and now have a beautiful garden.
If someone enjoys gardening, the activity is called gardening.

If they don't like it, its called yard work.

I do yard work.
Mr. Tightwad is online now   Reply With Quote
Old 07-10-2021, 10:56 AM   #172
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
MRG's Avatar
 
Join Date: Apr 2013
Posts: 10,701
Quote:
Originally Posted by marko View Post
True to a certain extent. But one could argue that those who fear the market, "the next Depression" and the headlines are already those with little financial acumen. You could see it as more of a symptom of financial ignorance than a cause; it confirms their bias.



These are the people who call the market a "casino" because their idiot uncle lost $500 in the market 50 years ago.
+1
My sister and her husband have zero investments. They had to tear the walls apart at his father's house after he passed, he'd walled in the money he'd saved over his life. He'd never seen the depression just stories about it from his parents. While this sounds like the act of a demented old guy he was like that at 40, not the demented part just afraid of what he didn't understand.

Sadly his son and my sister seem to have inherited his financial paranoia.
MRG is online now   Reply With Quote
Old 07-10-2021, 11:40 AM   #173
Thinks s/he gets paid by the post
 
Join Date: Jul 2017
Location: Long Island
Posts: 2,118
Quote:
Originally Posted by MRG View Post
+1
My sister and her husband have zero investments. They had to tear the walls apart at his father's house after he passed, he'd walled in the money he'd saved over his life. He'd never seen the depression just stories about it from his parents. While this sounds like the act of a demented old guy he was like that at 40, not the demented part just afraid of what he didn't understand.

Sadly his son and my sister seem to have inherited his financial paranoia.
Maybe he was hiding his money from your sister and her husband . . .
__________________
Use it up, wear it out, make it do or do without.
MarieIG is online now   Reply With Quote
Old 07-10-2021, 11:43 AM   #174
Thinks s/he gets paid by the post
 
Join Date: Jul 2017
Location: Long Island
Posts: 2,118
Quote:
Originally Posted by marko View Post
And then there's just overall financial clueless-ness.

My SIL who's husband makes an easy 7 figures a year and lives in a 3.5MM house.

One day we were all chatting tangentially about financial differences and she said: "Well, you know, someone working in a grocery store could afford to live in my neighborhood".

We sat there with our mouths open for a few seconds and then said: "No, no they couldn't...you'r house is worth over 3 million dollars; your property taxes are more than they make in three years". She said: "Don't be silly. Of course they could! Anybody can afford to live here; we're nothing special" She meant it.

Marie Antoinette I suppose.
I see a trust in the future . . .
__________________
Use it up, wear it out, make it do or do without.
MarieIG is online now   Reply With Quote
Old 07-10-2021, 11:54 AM   #175
Thinks s/he gets paid by the post
 
Join Date: Jul 2017
Location: Long Island
Posts: 2,118
Quote:
Originally Posted by Bamaman View Post
My wife worked for a number of doctors, and they were generally of this scenario:

They lived in the country club neighborhood in a very nice home. He drives an older Escalade, and the wife has a luxury new SUV. Their 2.3 children went to private schools, and later to private colleges. The daughter went on to medical school, did her residency at Cleveland Clinic, married a young general surgeon and they're doing very well. The father has had to fund 100% of his pension because he's self employed, and he continues to work at 69 years old because he didn't invest well. And he could sure use some of that $1.25 million he spent on private schools and $75K a year private colleges.

The father would like to retire, but he's just not in any position due to the high lifestyle he led, and the expenses that come with that lifestyle. And he will continue to work into his 70's in a job he really no longer likes. The paperwork trail a physician has to follow is incredible, and he hates taking orders from non-medical people at The State on how to do his job.

The thing is that nobody ever took time to tell that Medical Doctor that he's going to be middle class in the economic scale.
Lots of people, with less income than physicians have to fund their retirement.

It seems that his problem was living an inflated lifestyle. (At least with his daughter he got a "return on that investment" in that she finished school and is doing well financially.)
__________________
Use it up, wear it out, make it do or do without.
MarieIG is online now   Reply With Quote
Old 07-10-2021, 12:00 PM   #176
Full time employment: Posting here.
teetee's Avatar
 
Join Date: Jul 2019
Posts: 640
Quote:
Originally Posted by Chuckanut View Post
+1

Wake me when the market is down over 20%.
If that happens, why wake up? I am not going to do anything to my portfolio, possibly not even when the market are down 80% cause selling anything at that point would realize my lose.

Oh maybe you have large wad of cash waiting to go into the market when it's down. In that case, people would say it is not desirable to time the market. You are missing out by waiting before the right time comes.

"Do no harm" for the doctors. "Do nothing" for the long term investors.
teetee is offline   Reply With Quote
Old 07-10-2021, 12:23 PM   #177
Thinks s/he gets paid by the post
 
Join Date: Jul 2017
Location: Long Island
Posts: 2,118
Quote:
Originally Posted by Markola View Post
Thank you. You seem on the right track about my friend’s father’s mindset. Yes, early 80s, was on his second marriage and the new DW was a high consumer/high maintenance type. Apparently, they’d been living beyond even their considerable means for some time, so the DF rolled the dice for one last big win. Instead, he got the devastating margin call and two years later he has dementia and is in a facility, so one wonders if he should have had his hands on the controls at all.

As salt in the wound, DW #2 told my friend last week that she no longer loved DF, was selling their home and would be moving back to Manhattan, essentially abandoning him to his subpar memory ward in NJ., or leaving him to my friend to manage from Minnesota somehow. I don’t see how DW II could legally keep the proceeds from the sale of their residence while her spouse is on Medicaid but my friend thinks the Medicaid laws in NJ are more generous than elsewhere. All kinds of life lessons in this story.


My dear see money-spend money father, of course, took SS at 62, even though I suggested that he wait. Yes, I’ll be glad to help him however we can.
There is a lot to be said there. There is a huge difference between a spouse continuing to reside in the house and selling the house. Your friend may be able to check on line for mortgages to determine whether there is equity left in the house, or whether it is mortgaged to the hilt.

I would recommend that your friend schedule a zoom conference with an elder care specialist who practices in NJ.

(She is going to have to take care she does not run up a huge legal bill for which she is responsible; but she may be able to get enough info a the consult to steer her in the right direction as to how DF can get support w/o her paying for it.)

I like the idea of showing up at the closing with an order to show cause directing the net proceeds of the sale be paid into the Court until the issue of a Medicare/ Medicaid set aside trust can established on behalf of the husband.

To the extent any fees are required for his care, or for a guardian ad litem on his behalf, or for a lawyer to represent him in a property dispute, those fees should come out of marital assets (to the extent medical costs are not covered by Medicaid/ Insurance).

With your DF, yes, that's very frustrating.
__________________
Use it up, wear it out, make it do or do without.
MarieIG is online now   Reply With Quote
Old 07-10-2021, 12:24 PM   #178
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
MRG's Avatar
 
Join Date: Apr 2013
Posts: 10,701
Quote:
Originally Posted by MarieIG View Post
Maybe he was hiding his money from your sister and her husband . . .


Could be. They could have bought another new car!
MRG is online now   Reply With Quote
Old 07-10-2021, 12:33 PM   #179
Thinks s/he gets paid by the post
 
Join Date: Jul 2017
Location: Long Island
Posts: 2,118
Quote:
Originally Posted by MRG View Post


Could be. They could have bought another new car!
__________________
Use it up, wear it out, make it do or do without.
MarieIG is online now   Reply With Quote
Old 07-10-2021, 02:54 PM   #180
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
 
Join Date: Jan 2018
Location: Tampa
Posts: 9,847
Quote:
Originally Posted by Mr. Tightwad View Post
If someone enjoys gardening, the activity is called gardening.

If they don't like it, its called yard work.

I do yard work.
Haha very good. Well I don't mow the lawn or put the chemicals into the lawn. Just the planting and gardening.
__________________
TGIM
Dtail 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 02:10 PM.
 
Powered by vBulletin® Version 3.8.8 Beta 1
Copyright ©2000 - 2022, vBulletin Solutions, Inc.