Jump to content
Fantasy Football - Footballguys Forums

Personal Finance Advice and Education!


Recommended Posts

On 9/18/2020 at 2:30 PM, -OZ- said:

That's almost exactly our plan. 

The houses we like where we want to move are roughly $100-200k more than our current place, and my commute will go from 20 minutes to 45ish. Hopefully teleworking will be prominent. But that's 9-12 years away

What are your plans for moving when the kids leave the nest? We've always planned on being in a home with rooms for them through college and maybe a year or two afterwards just in case although we don't really want them back. But our good friends recently said they are moving to a smaller house in a different city as soon as the youngest leaves for college. That seems harsh to me, but maybe most people do that. 

Link to post
Share on other sites
  • Replies 5.9k
  • Created
  • Last Reply

Top Posters In This Topic

Top Posters In This Topic

Popular Posts

Well, today we paid off the last 22 years of our mortgage.  We sold/closed our investment property last week that we bought in 2013.  We did well on it and rolled that money up with some savings and p

Can't really talk about it with RL friends and most of it is pre-tax, but sat down with the wife and figured out that the household is officially in the two comma club. Ten years ago I was unemployed

My big win was in getting educated on personal finance, getting organized, and making a plan. Details: 1. Learned the value of an HSA and contributed for 2019 and 2020. 2. Got my wife’s

1 hour ago, BroncosFan07 said:

This is really what I was trying to get at.   I've pinched pennies my entire life and had a ton of luck with investing.   I've delayed getting knee replacements for 11 years now because I didn't want the financial expense and didn't want to miss time at work and miss my chance to impress someone for the next promotion.   I've always enjoyed high levels of stress since my work adds a lot however now that you add in having young kids and being so tight on money, my health is starting to sacrifice and I'm not combatting the stressful by doing things that I enjoy in life as much as I should.   My dad retired 3 years ago at age 62 and he seems pretty miserable in retirement.  His knees were just replaced, he had to have an ankle fused, and he needs to get his hip replaced once his knees recover.  On top of that he has high blood pressure and is diabetic and had quadruple bypass open heart surgery 20 years ago.   He has way more money than he needs in retirement and will eventually pass away without barely tapping into his balance.   I don't want my story to be like my dads.  

My general observation is that people have 4 stages of slowing down:

Mid-50s to Mid-60s - Still going well but starting to have some physical limitations. This is probably the best time to knock things off your bucket list and take long trips overseas. Of course, most people need to still be working throughout this stage. 

Mid-60s to Early/Mid-70s - Starting to slow down more but still generally active enough to enjoy some retirement trips and activities. This is when you need to do all those things you said you would do when you were retired. 

Mid-70s to Early/Mid-80s - A more sudden slow down, both physically and mentally. I've seen it in 6-7 different relatives so far. The trips and physical/mental excursions really slow down. Lots of hanging around the house, still seeing friends, rocking chair on the porch time. Not that many health issues yet but they are starting to pop up. 

Mid-80s to Death - Less movement, more likely to need care in the home or move to a nursing home, not a lot of fun in general. If you make it to your Mid-80s you have led a nice, long life, IMO. 

 

In terms of money needed, I think it's a U-shaped curve. You want to do lots of travel and bucket list stuff early on so you need money for that, on top of normal living expenses. Not much health care spending yet. 

Then in the 70s-80s, you are some more health care needs but much less leisure spending as the trips and excursions slow down. 

Finally by the mid-80s, health care costs go way up and that's the main component of your spending. 

My plan and advice to others is to enjoy that first part of retirement and do the things you want to do. I feel like people get too worried about the health care costs in their 80s and save more money that needed so that they never got that trip to Australia or cruise around the world or whatever. When you're lying in a nursing home at 86 as someone changes your bed pan, you'll wish you took those trips and not that you could be in a nursing home with gold plated bed pans. 

  • Like 2
Link to post
Share on other sites
On 9/18/2020 at 3:00 PM, -OZ- said:

We'll see how she does, but for 23 years together she's never been a big spender. She'll spend more now than ever before, but that's mostly the kids, DIY projects around the house (most of which I like) and weekly dinners with the girls, which has been good for her. The dinners probably add just over $100 / month, so I'm okay with it. 

I'd love it if she made more than I do. I'd settle for 5-10 years where she makes half my salary. Then we retire fully.

I've suggested we make her income the family fun money, she seems on board with that budget. 

I've been the sole provider for 28 years.  Settle for anything.

  • Love 1
Link to post
Share on other sites
41 minutes ago, ConstruxBoy said:

What are your plans for moving when the kids leave the nest? We've always planned on being in a home with rooms for them through college and maybe a year or two afterwards just in case although we don't really want them back. But our good friends recently said they are moving to a smaller house in a different city as soon as the youngest leaves for college. That seems harsh to me, but maybe most people do that. 

We have some time for that, but if I'm still working we'll probably move to a lake house an hour away (about 40 minutes from the current office). Get a place with 3 bedrooms, the kids can visit but not comfortable enough to crash long term. 

If all goes well, there's a chance we'd retire early, even while the youngest is in HS, home school her while traveling.  Teach math on the plane, world history in Rome, Egypt, normandy, Paris... That seems unfair to the others, but oh well. 

  • Like 1
  • Love 1
Link to post
Share on other sites
4 hours ago, BroncosFan07 said:

Thanks for the feedback.  Hare are my comments and follow up questions for these points.  Also, wanted to add that if we took the money out, it wouldn't be just for vacations.  Vacations would be one of the biggest expenses we have but really it would just to be less strapped everywhere.  The money would be a safety net incase we eat out too many times, use the babysitter too much, have unplanned medical expenses, etc.  Right now we are very careful about our money and break even.  If we relaxed a little, we could miss our budget by $400-$500 each month and at the end of the year learn that we spent 6k more than we earned.  The 100k would be used to support the 6k we need.   I have about 3 months in savings for emergencies that is not part of any of this discussion.  I never want to use the 6k out of the emergency fund.  I already had to tap into it twice in 2019 because we blew an engine twice 6 months apart on the same vehicle (lemon - and it's been traded in for a low mileage used car now).  

1.  I'm curious to learn more about a 401k loan.  I thought I read at one time you could only get a 401k loan to cover new home purchases or other limited categories.  I also recall that you can only take 1/2 of your vested balance, which wouldn't be ideal for me since I haven't been at my new company long enough to have much of a 401k balance.   90% of my retirement money was from the previous employee's 401k that I rolled over to a Fidelity IRA account.   Are there any "catches" to a 401k loan other than you pay back the loan monthly and the interest goes into your account?

2.  $500 after tax a month for my wife's side job.   I live in Missouri and daycare is below average cost so the 3 of them cost $31k.  My wife makes just over 40k working 3 days a week so after taxes hit that, it's virtually break even for her to watch the kids.  Also, she needs the 2 days a week in order to do her side job.   Having the kids home 5 days a week would probably drop the $500 per month savings.   The biggest factor in her keeping her 3 days a week job is because its a great job and she still gets adult interaction and she has the ability to go back to 4 days or 5 days in the future if she would ever want to (I hope she never has to).   Also, we shed 1 daycare in a few weeks so her working 3 days a week provides considerable more money than the soon to be 2 daycares.  I've already factored getting 1 daycare bill back into our situation that gets us income to expenses to break even for a month.

3.  I already did this 16 months ago when baby #3 was born.   It was a rough 2019 because we closed on a new house but had to pay 2 mortgages, had the 2 car engines blow for about 10k in expenses, had to go from no car loans to 2 car loans because of baby #3 and needing room for car seats, and also all of the money around the birth of the child.   We are back on track in 2020, but 2019 was a year I was very thankful to have that emergency savings.

Contact your 401k plan administrator for the options on the 401k loan. There is what the government allows and then there is what the individual plans allow/offer, so your specific options may vary. 

Link to post
Share on other sites
On 9/18/2020 at 4:57 PM, stbugs said:

Moving in a sense of getting the cheaper mortgage yes. Real moving no, but we both work from home (pre CV) so no job location distance that people would suspect.

I think income wise we should be fine. Not worried about that. Due to buying the last house at a great time and not being young, our current mortgage (balance not payment) is actually less than our combined salaries and my taxable accounts are also more than the mortgage. Since the mortgage interest isn’t tax deductible (maybe Biden?), I figured a shorter term would be the equivalent of just paying it down faster since we don’t plan on being here more than 5-10. Basically just reducing interest and partially because the loan rate would also drop. I just ran the numbers for where I am and bumping to a 15 year would bump my payment up $500 but my principal pay down would be almost $700 more a month. So a net extra 50% return on every payment. At the end of year 5, the extra principal is almost $800 more so a 60% return on the extra payment each month. Seems crazy to not do it.

Just pay ahead or in your case, invest the money.  Nothing like paying 2.75% and watching your Amazon do 20% a year.  I'm in the process of taking a 15 to 30 year because it will allow more dti flexibility.  Also dti ratios have dropped recently.

Link to post
Share on other sites

I've had my HSA for years at my local bank languishing at 0.005% interest or whatever it is. Just recently found Lively, which lets you invest your HSA deposits with TD.

Better late than never. In the midst of transferring everything now.

Link to post
Share on other sites

Well, today we paid off the last 22 years of our mortgage.  We sold/closed our investment property last week that we bought in 2013.  We did well on it and rolled that money up with some savings and paid off the house.

We had a 3.7% loan and thought about refinancing, but there was no way we were going to go full term on a 15 or 30 year, so it didn't make sense.

Since the future is unknown I don't know if in the long run this was the best choice versus other usages of the funds, but we now are 100% debt free at 39 years old.  Feeling pretty good about that.

 

  • Like 13
  • Thanks 1
  • Love 3
Link to post
Share on other sites
6 minutes ago, xulf said:

Well, today we paid off the last 22 years of our mortgage.  We sold/closed our investment property last week that we bought in 2013.  We did well on it and rolled that money up with some savings and paid off the house.

We had a 3.7% loan and thought about refinancing, but there was no way we were going to go full term on a 15 or 30 year, so it didn't make sense.

Since the future is unknown I don't know if in the long run this was the best choice versus other usages of the funds, but we now are 100% debt free at 39 years old.  Feeling pretty good about that.

 

Congrats.  Not the direction I would have gone, but very impressive on your part to pull that off.

  • Like 1
Link to post
Share on other sites
2 hours ago, xulf said:

Well, today we paid off the last 22 years of our mortgage.  We sold/closed our investment property last week that we bought in 2013.  We did well on it and rolled that money up with some savings and paid off the house.

We had a 3.7% loan and thought about refinancing, but there was no way we were going to go full term on a 15 or 30 year, so it didn't make sense.

Since the future is unknown I don't know if in the long run this was the best choice versus other usages of the funds, but we now are 100% debt free at 39 years old.  Feeling pretty good about that.

Did the same thing.  Don't regret it.  My liabilities are whatever my CC bills are at the moment.

Of course, as soon as I did that a hurricane decided to slap around my other place.  Sandblasted the paint off of one side it was so fierce.  Bah humbug.

  • Like 2
Link to post
Share on other sites
2 hours ago, xulf said:

Well, today we paid off the last 22 years of our mortgage.  We sold/closed our investment property last week that we bought in 2013.  We did well on it and rolled that money up with some savings and paid off the house.

We had a 3.7% loan and thought about refinancing, but there was no way we were going to go full term on a 15 or 30 year, so it didn't make sense.

Since the future is unknown I don't know if in the long run this was the best choice versus other usages of the funds, but we now are 100% debt free at 39 years old.  Feeling pretty good about that.

 

Awesome.  Been in that boat for about 7 years now and it's great.  Just opens up so much.  And given all the employment uncertainties with COVID, just knowing that you don't have what most people's largest expense is.....that's a huge "peace of mind" aspect.

  • Like 1
Link to post
Share on other sites
9 hours ago, xulf said:

 I don't know if in the long run this was the best choice versus other usages of the funds, but we now are 100% debt free at 39 years old.  Feeling pretty good about that.

 

If it gives you peace of mind, it's the right move. Congrats!

  • Like 2
Link to post
Share on other sites

I wasn't sure where to post this question but this seems like the right spot for it (real estate related).

My wife and I live in a very high cost of living area. We've lived here for almost two years and currenty rent after owning a home in our previous location (reasonable cost of living area). In terms of property we also currently own a rental property, 3-unit building that is doing well and is cash flow positive.

Most of my adult life I have been against renting, that is until I moved to our current location. Where we live it is extremely tenant friendly (ex. we're on a "lease" but can leave at any time with 1-month notice, rent is tied to inflation, etc.) and while this is nice I do miss having a yard, BBQs, or even a balcony. To purchase an apartment our city is approximately $1,200/sqft and a house in the suburbs we would want to live in is approximately $750-850/sqft. Places do retain their value very well (I know we've all heard this one before...). Also to purchase a place requires a large amount of upfront fees (~8%) and the breakeven to renting would be about 5-6 years we figure. It's possible that we could purchase a place next year but it would really wipe out a lot of our savings and life certainly wouldn't be as comfortable. Also we need to move next year as baby #1 is on the way and we live in a 550sqft, 1-bedroom apartment. So would be moving to a house for the long haul or......

Lately I have been warming to the idea of renting longer term as we live in such a high cost of living area. Moving to rent to a slightly more expensive 2-bedroom apartment and using some our savings to purchase a vacation apartment. The vacation apartment would be in an area with lower upfront fees and cost less $ per sqft. More importantly we could purchase the vacation apartment, fill it with some toys (bikes, paddleboard, furniture, etc) and still have savings. Would be in a place that we like and is easily accessible and a place for our money to go while allowing us easy future vacations with our family and friends. Or just a long weekend. After looking at the amortization table for the amount of mortgage that we'd want, the monthly interest portion of the mortgage would be around $400-500 (very low interest rates). 

Is it crazy to consider continuing to rent while purchasing a place that is not a primary residence? I can't imagine this making sense if we were living in a low or medium cost of living area but in a high cost of living area I can understand it. I suppose it also depends on how much we think the vacation spot would appreciate over time. Could find a company to manage it to rent out every so often on AirBnB too, although not my first choice.

What do you think? Feel free to call me insane. TIA.

Link to post
Share on other sites

I think the two decisions are independent and there is no reason to think of them together

 

Decision 1 - Rent vs buy for primary.  5-7 years is a typical break even, so you need to know that you'll be there for that duration.  Some people like to fix things themselves, others like to call the Super/landlord.  I am a believer in having 20% downpayment, so that can be a barrier.  Some are young and are better served to be mobile for their career or life and not be tied to a house.  And so on.  

 

Decision 2 - Rent vs buy for vacation home.  Again, I would want to know that I am going to be in that area 5-7 years at least.  I'd compare the annual cost of renting vs annual cost of owning.  If you plan to be a landlord (rent the place in your absence) that's a decision.  Understand what it takes for upkeep (vacatoin is not a vacation if you're patching and painting the whole time).  There's pros and cons both ways

  • Like 1
  • Thinking 1
Link to post
Share on other sites
31 minutes ago, Harris said:

I wasn't sure where to post this question but this seems like the right spot for it (real estate related).

My wife and I live in a very high cost of living area. We've lived here for almost two years and currenty rent after owning a home in our previous location (reasonable cost of living area). In terms of property we also currently own a rental property, 3-unit building that is doing well and is cash flow positive.

Most of my adult life I have been against renting, that is until I moved to our current location. Where we live it is extremely tenant friendly (ex. we're on a "lease" but can leave at any time with 1-month notice, rent is tied to inflation, etc.) and while this is nice I do miss having a yard, BBQs, or even a balcony. To purchase an apartment our city is approximately $1,200/sqft and a house in the suburbs we would want to live in is approximately $750-850/sqft. Places do retain their value very well (I know we've all heard this one before...). Also to purchase a place requires a large amount of upfront fees (~8%) and the breakeven to renting would be about 5-6 years we figure. It's possible that we could purchase a place next year but it would really wipe out a lot of our savings and life certainly wouldn't be as comfortable. Also we need to move next year as baby #1 is on the way and we live in a 550sqft, 1-bedroom apartment. So would be moving to a house for the long haul or......

Lately I have been warming to the idea of renting longer term as we live in such a high cost of living area. Moving to rent to a slightly more expensive 2-bedroom apartment and using some our savings to purchase a vacation apartment. The vacation apartment would be in an area with lower upfront fees and cost less $ per sqft. More importantly we could purchase the vacation apartment, fill it with some toys (bikes, paddleboard, furniture, etc) and still have savings. Would be in a place that we like and is easily accessible and a place for our money to go while allowing us easy future vacations with our family and friends. Or just a long weekend. After looking at the amortization table for the amount of mortgage that we'd want, the monthly interest portion of the mortgage would be around $400-500 (very low interest rates). 

Is it crazy to consider continuing to rent while purchasing a place that is not a primary residence? I can't imagine this making sense if we were living in a low or medium cost of living area but in a high cost of living area I can understand it. I suppose it also depends on how much we think the vacation spot would appreciate over time. Could find a company to manage it to rent out every so often on AirBnB too, although not my first choice.

What do you think? Feel free to call me insane. TIA.

This thread might help you.  https://forums.footballguys.com/forum/topic/787050-buying-a-vacation-home-as-an-investment-property/?tab=comments#comment-22884692  There's a lot in there from a very helpful poster.  The caveat being that maybe French people are respectful of property.

How would you fill that second home with things that wouldn't walk off or get destroyed?  Also in addition to mayonnaise and vinegar on your bedding, not you have COVID in your place.

The expectation in metro areas here is that home prices will fall as the WFH people scatter from the huge metro areas.  Obviously you are going to have a much better handle on what COVID did to your local economy.  If COVID is with us for another year that $750 to $850 a square foot may drop.  From details presented, I would rent another year and see how the landscape changes.

Link to post
Share on other sites
6 minutes ago, FishNSuds said:

This thread might help you.  https://forums.footballguys.com/forum/topic/787050-buying-a-vacation-home-as-an-investment-property/?tab=comments#comment-22884692  There's a lot in there from a very helpful poster.  The caveat being that maybe French people are respectful of property.

How would you fill that second home with things that wouldn't walk off or get destroyed?  Also in addition to mayonnaise and vinegar on your bedding, not you have COVID in your place.

The expectation in metro areas here is that home prices will fall as the WFH people scatter from the huge metro areas.  Obviously you are going to have a much better handle on what COVID did to your local economy.  If COVID is with us for another year that $750 to $850 a square foot may drop.  From details presented, I would rent another year and see how the landscape changes.

Would likely not want to rent it out for the reasons you mentioned and would make it a spot we could easily get to and immediately unwind for the weekend or work remotely from for an small extended period. Perhaps one day 8 years from now I could turn it into a permanent rental but would not rent it immediately. And definitely would be a vacation condo/apartment vs. home. Do not want to worry about yard work or the large amount of work that comes with a house as compared to condo.

 

It's certainly interesting regarding the home prices falling in the US in large metro areas. Here in Paris the home prices in the city proper are likely to stay stable as the population density is outrageous. I have heard of a large amount of interest in people looking at places in the suburbs here as they want to have a yard and outdoor space to be able to work remotely from if work from home becomes more permanent. In the city proper here there is not much green space at all besides dedicated parks. And no one has houses, only apartments within the city limits. Leaving the metro area here is much more difficult as so many of the jobs in the country are concentrated in one city unlike in the US.

Link to post
Share on other sites
10 minutes ago, Harris said:

Would likely not want to rent it out for the reasons you mentioned and would make it a spot we could easily get to and immediately unwind for the weekend or work remotely from for an small extended period. Perhaps one day 8 years from now I could turn it into a permanent rental but would not rent it immediately. And definitely would be a vacation condo/apartment vs. home. Do not want to worry about yard work or the large amount of work that comes with a house as compared to condo.

 

It's certainly interesting regarding the home prices falling in the US in large metro areas. Here in Paris the home prices in the city proper are likely to stay stable as the population density is outrageous. I have heard of a large amount of interest in people looking at places in the suburbs here as they want to have a yard and outdoor space to be able to work remotely from if work from home becomes more permanent. In the city proper here there is not much green space at all besides dedicated parks. And no one has houses, only apartments within the city limits. Leaving the metro area here is much more difficult as so many of the jobs in the country are concentrated in one city unlike in the US.

I kind of like your idea of buying a second place you want to hang and enjoy if the housing landscape there forces you live in a place that isn't optimal.  A lot of people in the US working in the mega metros rented a small place for the week and then departed for their "home" on the weekends.

Link to post
Share on other sites
28 minutes ago, wilked said:

I think the two decisions are independent and there is no reason to think of them together

 

Decision 1 - Rent vs buy for primary.  5-7 years is a typical break even, so you need to know that you'll be there for that duration.  Some people like to fix things themselves, others like to call the Super/landlord.  I am a believer in having 20% downpayment, so that can be a barrier.  Some are young and are better served to be mobile for their career or life and not be tied to a house.  And so on.  

 

Decision 2 - Rent vs buy for vacation home.  Again, I would want to know that I am going to be in that area 5-7 years at least.  I'd compare the annual cost of renting vs annual cost of owning.  If you plan to be a landlord (rent the place in your absence) that's a decision.  Understand what it takes for upkeep (vacatoin is not a vacation if you're patching and painting the whole time).  There's pros and cons both ways

:goodposting:

Buy VS. Rent is a real thing, particularly in HCOL spots.  There are good calculators out there.

On the second one, I'm a big believer in "but utility, rent luxury". 

  • Like 2
Link to post
Share on other sites
1 hour ago, Harris said:

 

Is it crazy to consider continuing to rent while purchasing a place that is not a primary residence? I can't imagine this making sense if we were living in a low or medium cost of living area but in a high cost of living area I can understand it. I suppose it also depends on how much we think the vacation spot would appreciate over time. Could find a company to manage it to rent out every so often on AirBnB too, although not my first choice.

What do you think? Feel free to call me insane. TIA.

I couldn't imagine paying $750 or more per square feet. We're just under $100/sq ft. Maybe for like a 2nd row beach house I can see it, but wow. 

If you plan to visit the 2nd home fairly often I wouldn't bother renting it out. We've considered the same idea but it doesn't seem worth it to rent out and risk damaging the house. 

1 hour ago, wilked said:

I think the two decisions are independent and there is no reason to think of them together

 

Decision 1 - Rent vs buy for primary.  5-7 years is a typical break even, so you need to know that you'll be there for that duration.  Some people like to fix things themselves, others like to call the Super/landlord.  I am a believer in having 20% downpayment, so that can be a barrier.  Some are young and are better served to be mobile for their career or life and not be tied to a house.  And so on.  

 

Decision 2 - Rent vs buy for vacation home.  Again, I would want to know that I am going to be in that area 5-7 years at least.  I'd compare the annual cost of renting vs annual cost of owning.  If you plan to be a landlord (rent the place in your absence) that's a decision.  Understand what it takes for upkeep (vacatoin is not a vacation if you're patching and painting the whole time).  There's pros and cons both ways

:goodposting:

Link to post
Share on other sites
18 minutes ago, -OZ- said:

I couldn't imagine paying $750 or more per square feet. We're just under $100/sq ft. Maybe for like a 2nd row beach house I can see it, but wow. 

Same, it's quite hard to stomach for a house but interest rates here are around 1% on a 25-year term. Once you get over the initial hump of the high fees/taxes on the initial purchase, it's nearly all equity you're plowing into it. And most, but not all, houses are generally quite small here....at least for the price we're looking at.

 

  • Like 1
Link to post
Share on other sites
42 minutes ago, -OZ- said:

I couldn't imagine paying $750 or more per square feet. We're just under $100/sq ft. Maybe for like a 2nd row beach house I can see it, but wow. 

First row beach house here is about $500/sq.ft. or less.

Link to post
Share on other sites
12 minutes ago, Sand said:

First row beach house here is about $500/sq.ft. or less.

Gulf shores? We've considered it. 

We're headed to Hilton Head in a week. The house we're renting according to zillow is $450 /sq ft, third row. The first row homes we'll walk between both cost just over $3 million. Oddly, one is just over 3,000', the other is 6,700'. With only $300k difference in price. 

🤔 The house next door to where we're staying is actually for sale, if anyone has an extra $1.2 million laying around, looks like a nice place. 

Edited by -OZ-
  • Like 1
Link to post
Share on other sites
1 hour ago, -OZ- said:

Gulf shores? We've considered it. 

We're headed to Hilton Head in a week. The house we're renting according to zillow is $450 /sq ft, third row. The first row homes we'll walk between both cost just over $3 million. Oddly, one is just over 3,000', the other is 6,700'. With only $300k difference in price. 

🤔 The house next door to where we're staying is actually for sale, if anyone has an extra $1.2 million laying around, looks like a nice place. 

At least down in Ft. Morgan the land of my place is worth twice the structure.  This pricing makes sense.

  • Thanks 1
Link to post
Share on other sites
2 hours ago, -OZ- said:

Gulf shores? We've considered it. 

We're headed to Hilton Head in a week. The house we're renting according to zillow is $450 /sq ft, third row. The first row homes we'll walk between both cost just over $3 million. Oddly, one is just over 3,000', the other is 6,700'. With only $300k difference in price. 

🤔 The house next door to where we're staying is actually for sale, if anyone has an extra $1.2 million laying around, looks like a nice place. 

Be right back....going to short OTC Biotech stonks....

  • Like 1
  • Laughing 2
Link to post
Share on other sites
1 hour ago, Sand said:

At least down in Ft. Morgan the land of my place is worth twice the structure.  This pricing makes sense.

Good point. The extra 3,000' might only be worth $100 per foot. I'm not sure about Zillow, would damage or upgrades be included on the site if the house isn't for sale?

Link to post
Share on other sites
46 minutes ago, ConstruxBoy said:

Be right back....going to short OTC Biotech stonks....

I'll be happy to check it out for you. 

Hell, I'd be happy to go halfsies, or part of a group there. 

  • Laughing 1
Link to post
Share on other sites
On 9/22/2020 at 6:51 PM, xulf said:

Well, today we paid off the last 22 years of our mortgage.  We sold/closed our investment property last week that we bought in 2013.  We did well on it and rolled that money up with some savings and paid off the house.

We had a 3.7% loan and thought about refinancing, but there was no way we were going to go full term on a 15 or 30 year, so it didn't make sense.

Since the future is unknown I don't know if in the long run this was the best choice versus other usages of the funds, but we now are 100% debt free at 39 years old.  Feeling pretty good about that.

 

I would have advised differently but I am sure that is a huge emotional payoff. Congrats!

Link to post
Share on other sites
11 hours ago, -OZ- said:

Good point. The extra 3,000' might only be worth $100 per foot. I'm not sure about Zillow, would damage or upgrades be included on the site if the house isn't for sale?

Zillow is for poo and the answer is no. 

ETA: Unless the owner input this into Zillow.... even then... still for poo. 

Edited by Chadstroma
added info
Link to post
Share on other sites
  • 4 weeks later...

Interested in getting some other takes on this and to see if others have seen this at their employers. My company got a new CEO and the dude is slashing everything, expecting 20% headcount reduction, lots of other changes. Today we received an email that our company matching contributions to our 401K next year will change to an annual contribution. Currently they match dollar for dollar up to 6%, that part stays the same. What will change is matching contributions will not be paid into a person's account until the last Bus Day of the year and you must be employed as of 12/15 to receive them.

So this company is going down the tubes and I am trying to get my ducks in a row to start actively looking for another position. I think it unlikely that I will be around for all of next year either through possible layoff or by finding another job. Seems like a no brainer to turn off 401K contributions starting January 1st and to put that money in either a Roth (if I qualify due to FBG money) or some other investment vehicle. Wondering if I am thinking about this incorrectly or missing anything?

Link to post
Share on other sites
18 minutes ago, Buckna said:

Interested in getting some other takes on this and to see if others have seen this at their employers. My company got a new CEO and the dude is slashing everything, expecting 20% headcount reduction, lots of other changes. Today we received an email that our company matching contributions to our 401K next year will change to an annual contribution. Currently they match dollar for dollar up to 6%, that part stays the same. What will change is matching contributions will not be paid into a person's account until the last Bus Day of the year and you must be employed as of 12/15 to receive them.

So this company is going down the tubes and I am trying to get my ducks in a row to start actively looking for another position. I think it unlikely that I will be around for all of next year either through possible layoff or by finding another job. Seems like a no brainer to turn off 401K contributions starting January 1st and to put that money in either a Roth (if I qualify due to FBG money) or some other investment vehicle. Wondering if I am thinking about this incorrectly or missing anything?

:unsure: Do we work at the same place?

  • Sad 1
Link to post
Share on other sites
48 minutes ago, Buckna said:

Interested in getting some other takes on this and to see if others have seen this at their employers. My company got a new CEO and the dude is slashing everything, expecting 20% headcount reduction, lots of other changes. Today we received an email that our company matching contributions to our 401K next year will change to an annual contribution. Currently they match dollar for dollar up to 6%, that part stays the same. What will change is matching contributions will not be paid into a person's account until the last Bus Day of the year and you must be employed as of 12/15 to receive them.

So this company is going down the tubes and I am trying to get my ducks in a row to start actively looking for another position. I think it unlikely that I will be around for all of next year either through possible layoff or by finding another job. Seems like a no brainer to turn off 401K contributions starting January 1st and to put that money in either a Roth (if I qualify due to FBG money) or some other investment vehicle. Wondering if I am thinking about this incorrectly or missing anything?

Do you already max your Roth IRA? If not, probably makes sense to do that first and then any excess you feel comfortable into your 401K (even if no match it’s still a good investment vehicle). 

Link to post
Share on other sites
34 minutes ago, bcnfinance said:

Do you already max your Roth IRA? If not, probably makes sense to do that first and then any excess you feel comfortable into your 401K (even if no match it’s still a good investment vehicle). 

Roth vs. 401k probably should be more of a tax situation. I max out 401ks because my tax bracket with my wife working as well. That 401k is money that would have been taxed at our highest bracket and can impact other things like capital gains. If you are in a high tax bracket then maxing 401k is a good move even without a match (that change sucks). If you aren’t then that match change would make me think differently. Also, Roth may not even be an option for FBG’s salaries.

Also, we need to see what happens in the election as Biden wants to change 401k tax deductions to some sort of credit. I’m sure I’ll get screwed somehow.

  • Like 1
Link to post
Share on other sites
1 hour ago, bcnfinance said:

Do you already max your Roth IRA? If not, probably makes sense to do that first and then any excess you feel comfortable into your 401K (even if no match it’s still a good investment vehicle). 

Thanks, this is kind of along the lines I was thinking as we don't currently max our Roth's and are not quite up to the phase out limit for married filing jointly (although getting close.)

Link to post
Share on other sites
  • 1 month later...
On 10/21/2020 at 8:48 PM, stbugs said:

Roth vs. 401k probably should be more of a tax situation. I max out 401ks because my tax bracket with my wife working as well. That 401k is money that would have been taxed at our highest bracket and can impact other things like capital gains. If you are in a high tax bracket then maxing 401k is a good move even without a match (that change sucks). If you aren’t then that match change would make me think differently. Also, Roth may not even be an option for FBG’s salaries.

Also, we need to see what happens in the election as Biden wants to change 401k tax deductions to some sort of credit. I’m sure I’ll get screwed somehow.

1. You can always backdoor it (unless for some reason you have a traditional IRA which complicates things)

2. If you aren't at the phaseout, it is almost always a better choice to get money into your Roth IRA - after making sure you maximize any 401(k) company match, that is. 

Link to post
Share on other sites
25 minutes ago, Instinctive said:

1. You can always backdoor it (unless for some reason you have a traditional IRA which complicates things)

2. If you aren't at the phaseout, it is almost always a better choice to get money into your Roth IRA - after making sure you maximize any 401(k) company match, that is. 

For 2, I’m not eligible for it anyway with my wife, but I’d still stick with 401k max because I think my tax levels when retired will be less. Only your top tax bracket would matter as every dollar you take off the tax table is at that highest rate. For people earlier in their career or having a lower top bracket, it makes a lot of sense. Also, I don’t think I’ve ever seen a study on it, but I wonder if having all the taxable dollars working for you during a bull run like we’ve had changes the discussion. You still get taxed on withdrawal but could you end up with enough that you never withdraw it all and it keeps compounding until your kids get it? I think there are new tax laws about having them have to drain those accounts and not just let them keep rolling.

Link to post
Share on other sites
1 hour ago, stbugs said:

For 2, I’m not eligible for it anyway with my wife, but I’d still stick with 401k max because I think my tax levels when retired will be less. Only your top tax bracket would matter as every dollar you take off the tax table is at that highest rate. For people earlier in their career or having a lower top bracket, it makes a lot of sense. Also, I don’t think I’ve ever seen a study on it, but I wonder if having all the taxable dollars working for you during a bull run like we’ve had changes the discussion. You still get taxed on withdrawal but could you end up with enough that you never withdraw it all and it keeps compounding until your kids get it? I think there are new tax laws about having them have to drain those accounts and not just let them keep rolling.

There's more to it than "will my rate be higher or lower in retirement?"

 

There's the ability to pull Roth funds without it affecting that rate, and the argument in favor of diversified sources to pull from in retirement. AND, if you can afford it now, saving post-tax dollars means you are functionally saving more dollars in a tax advantaged space, which is the biggest thing people overlook. Savings in a Roth account are literally more dollars in retirement than savings in traditional accounts. 

 

I don't like timing the market but the last insight is interesting at least. 

Link to post
Share on other sites
13 minutes ago, Instinctive said:

There's more to it than "will my rate be higher or lower in retirement?"

 

There's the ability to pull Roth funds without it affecting that rate, and the argument in favor of diversified sources to pull from in retirement. AND, if you can afford it now, saving post-tax dollars means you are functionally saving more dollars in a tax advantaged space, which is the biggest thing people overlook. Savings in a Roth account are literally more dollars in retirement than savings in traditional accounts. 

 

I don't like timing the market but the last insight is interesting at least. 

If your tax rates are identical, they are exactly the same assuming you withdraw every dollar. People mention that you save more, but that is an apples to oranges comparison as it means that you used extra money to pay taxes so that you invested the same amount . You also need to use an example where that extra money you put in the Roth is put into a brokerage account because that money can grow and will be taxed at capital gains rates which historically is less than income taxes and unless Biden passes a change, can be passed to children with a step up basis. It doesn’t matter to me as I can’t take advantage of it right now but just saying that someone spends $15k to net $10k in Roth and compare it to $10k in 401k/Traditional. There’s $5k missing that could go into stocks and either never get taxed (inherited) or get capital gains treatment. 

Link to post
Share on other sites
13 hours ago, stbugs said:

If your tax rates are identical, they are exactly the same assuming you withdraw every dollar. People mention that you save more, but that is an apples to oranges comparison as it means that you used extra money to pay taxes so that you invested the same amount . You also need to use an example where that extra money you put in the Roth is put into a brokerage account because that money can grow and will be taxed at capital gains rates which historically is less than income taxes and unless Biden passes a change, can be passed to children with a step up basis. It doesn’t matter to me as I can’t take advantage of it right now but just saying that someone spends $15k to net $10k in Roth and compare it to $10k in 401k/Traditional. There’s $5k missing that could go into stocks and either never get taxed (inherited) or get capital gains treatment. 

Yeah I mean if your goal is to build an inheritance fund your function changes significantly. That is not my goal and I haven't looked at that as a goal at all. Would defer to you there.

 

I'm not comparing apples to oranges. I'm simply stating that if you can afford the taxes now, you are getting more pre-tax dollars into tax advantaged space. And I have made such an example (I'll dig it up if I can), and because you're growth is getting taxed along the way (dividends) in your traditional, your drag there does still put you behind on the same amount of cash (of course you can always play with the assumptions to change that).  For me, as I have plenty of income + savings now, I highly value the creation of tax free income for retirement (especially since I'm on target to retire around age 35) as well as the ability to pull principle if I need to. Given that so much is unknown about the future, and we are currently at the lowest marginal tax rates in the history of the nation, chances are, IMO, taxes will actually be higher even with lower income in a decade plus. So even if we go with the basic "tax rates higher now or later", I think there's a strong argument they'll be higher later for anyone with meaningful income/wealth.

  • Like 1
Link to post
Share on other sites
2 hours ago, Instinctive said:

Yeah I mean if your goal is to build an inheritance fund your function changes significantly. That is not my goal and I haven't looked at that as a goal at all. Would defer to you there.

 

I'm not comparing apples to oranges. I'm simply stating that if you can afford the taxes now, you are getting more pre-tax dollars into tax advantaged space. And I have made such an example (I'll dig it up if I can), and because you're growth is getting taxed along the way (dividends) in your traditional, your drag there does still put you behind on the same amount of cash (of course you can always play with the assumptions to change that).  For me, as I have plenty of income + savings now, I highly value the creation of tax free income for retirement (especially since I'm on target to retire around age 35) as well as the ability to pull principle if I need to. Given that so much is unknown about the future, and we are currently at the lowest marginal tax rates in the history of the nation, chances are, IMO, taxes will actually be higher even with lower income in a decade plus. So even if we go with the basic "tax rates higher now or later", I think there's a strong argument they'll be higher later for anyone with meaningful income/wealth.

I feel like we had this discussion several months back, or at least stbugs and I did. I agree with you. His point about the same amount of money does make sense. However the diversity of having already taxed monies and the possibility that rates do go up makes it wise to have a portion in Roths. I'd say 20-30%. 

Also, I believe the latest tax laws did away with the stretch IRAs. So now your kids need to take the money out within 10 years. In the past, they could keep the accounts forever without paying any tax and just pass on the account to their kids. 

Link to post
Share on other sites
On 10/21/2020 at 9:07 PM, bcnfinance said:
On 10/21/2020 at 8:17 PM, Buckna said:

Interested in getting some other takes on this and to see if others have seen this at their employers. My company got a new CEO and the dude is slashing everything, expecting 20% headcount reduction, lots of other changes. Today we received an email that our company matching contributions to our 401K next year will change to an annual contribution. Currently they match dollar for dollar up to 6%, that part stays the same. What will change is matching contributions will not be paid into a person's account until the last Bus Day of the year and you must be employed as of 12/15 to receive them.

So this company is going down the tubes and I am trying to get my ducks in a row to start actively looking for another position. I think it unlikely that I will be around for all of next year either through possible layoff or by finding another job. Seems like a no brainer to turn off 401K contributions starting January 1st and to put that money in either a Roth (if I qualify due to FBG money) or some other investment vehicle. Wondering if I am thinking about this incorrectly or missing anything?

Do you already max your Roth IRA? If not, probably makes sense to do that first and then any excess you feel comfortable into your 401K (even if no match it’s still a good investment vehicle). 

The other thing to remember here is that a new employer would typically have a lag before you start getting a match there too (and sometimes a month or quarter for eligibility). So it may make sense to front load the 401k actually if you won't have it as an option later in the year. You can always put money into the Roth even while unemployed.

Link to post
Share on other sites

Interested in folks take on the right play here.

My 16 year-old son (HS sophomore) just inherited $100K from his grandmother to be held in trust until he is 30 (unless the money is used for school, housing, or medical expenses).   We already are fortunate to have enough saved in a 529 to cover at least four years of any college (and possibly grad school/prof school as well, if necessary), so hopefully the money can remain untouched for at least 7-10 years.  

My son is very interested in finance and investments so I told him I would post here to get the FBG-expert take on where the trust should stash his money.  The kicker to make this more complicated - his mother and I both work in Federal oversight positions and our ability to invest in specific stocks or some sector funds is extremely limited.  We also would not be allowed to make frequent trades - all transactions need to be approved and any purchase has to be held for at least 30 days.  

So, based on these limitations and initial research, he proposed to put most of the money in a standard index fund, another portion in one or two sector funds, and a small amount (maybe 5-10 percent) as a "gamble" in a potential growth stock of his choosing (obviously only one that we would be permitted to hold).

Thoughts?

Link to post
Share on other sites
37 minutes ago, scorchy said:

Interested in folks take on the right play here.

My 16 year-old son (HS sophomore) just inherited $100K from his grandmother to be held in trust until he is 30 (unless the money is used for school, housing, or medical expenses).   We already are fortunate to have enough saved in a 529 to cover at least four years of any college (and possibly grad school/prof school as well, if necessary), so hopefully the money can remain untouched for at least 7-10 years.  

My son is very interested in finance and investments so I told him I would post here to get the FBG-expert take on where the trust should stash his money.  The kicker to make this more complicated - his mother and I both work in Federal oversight positions and our ability to invest in specific stocks or some sector funds is extremely limited.  We also would not be allowed to make frequent trades - all transactions need to be approved and any purchase has to be held for at least 30 days.  

So, based on these limitations and initial research, he proposed to put most of the money in a standard index fund, another portion in one or two sector funds, and a small amount (maybe 5-10 percent) as a "gamble" in a potential growth stock of his choosing (obviously only one that we would be permitted to hold).

Thoughts?

Can a trust invest in real estate?

Link to post
Share on other sites
2 hours ago, scorchy said:

Interested in folks take on the right play here.

My 16 year-old son (HS sophomore) just inherited $100K from his grandmother to be held in trust until he is 30 (unless the money is used for school, housing, or medical expenses).   We already are fortunate to have enough saved in a 529 to cover at least four years of any college (and possibly grad school/prof school as well, if necessary), so hopefully the money can remain untouched for at least 7-10 years.  

My son is very interested in finance and investments so I told him I would post here to get the FBG-expert take on where the trust should stash his money.  The kicker to make this more complicated - his mother and I both work in Federal oversight positions and our ability to invest in specific stocks or some sector funds is extremely limited.  We also would not be allowed to make frequent trades - all transactions need to be approved and any purchase has to be held for at least 30 days.  

So, based on these limitations and initial research, he proposed to put most of the money in a standard index fund, another portion in one or two sector funds, and a small amount (maybe 5-10 percent) as a "gamble" in a potential growth stock of his choosing (obviously only one that we would be permitted to hold).

Thoughts?

Seems like a very wise proposal to me 

  • Like 1
  • Thanks 1
Link to post
Share on other sites
2 hours ago, scorchy said:

Interested in folks take on the right play here.

My 16 year-old son (HS sophomore) just inherited $100K from his grandmother to be held in trust until he is 30 (unless the money is used for school, housing, or medical expenses).   We already are fortunate to have enough saved in a 529 to cover at least four years of any college (and possibly grad school/prof school as well, if necessary), so hopefully the money can remain untouched for at least 7-10 years.  

My son is very interested in finance and investments so I told him I would post here to get the FBG-expert take on where the trust should stash his money.  The kicker to make this more complicated - his mother and I both work in Federal oversight positions and our ability to invest in specific stocks or some sector funds is extremely limited.  We also would not be allowed to make frequent trades - all transactions need to be approved and any purchase has to be held for at least 30 days.  

So, based on these limitations and initial research, he proposed to put most of the money in a standard index fund, another portion in one or two sector funds, and a small amount (maybe 5-10 percent) as a "gamble" in a potential growth stock of his choosing (obviously only one that we would be permitted to hold).

Thoughts?

Any particular sector funds you're looking at? Tech is already expensive, and I don't know what else you would want to hold that long without rotation. Would be my biggest concern with that approach. 

Alternatively, @tdoss would like to suggest an investment in tulips.

Link to post
Share on other sites
35 minutes ago, scorchy said:

I think so.  Unfortunately, not sure what real estate you can buy around here for $100K.  

I was thinking land in the outskirts of a growing region such Jacksonville. You'd have to do a lot of research. But about a 1,000 people were moving to Florida per day, before the pandemic. It's picked up again.   

  • Like 1
Link to post
Share on other sites
3 hours ago, scorchy said:

Interested in folks take on the right play here.

My 16 year-old son (HS sophomore) just inherited $100K from his grandmother to be held in trust until he is 30 (unless the money is used for school, housing, or medical expenses).   We already are fortunate to have enough saved in a 529 to cover at least four years of any college (and possibly grad school/prof school as well, if necessary), so hopefully the money can remain untouched for at least 7-10 years.  

My son is very interested in finance and investments so I told him I would post here to get the FBG-expert take on where the trust should stash his money.  The kicker to make this more complicated - his mother and I both work in Federal oversight positions and our ability to invest in specific stocks or some sector funds is extremely limited.  We also would not be allowed to make frequent trades - all transactions need to be approved and any purchase has to be held for at least 30 days.  

So, based on these limitations and initial research, he proposed to put most of the money in a standard index fund, another portion in one or two sector funds, and a small amount (maybe 5-10 percent) as a "gamble" in a potential growth stock of his choosing (obviously only one that we would be permitted to hold).

Thoughts?

does he work?  If so, can open a Roth and start that as well.  (Well...now that I read it again, not sure how a trust would come into play there....but it's something to look into at least)

 

Link to post
Share on other sites

Join the conversation

You can post now and register later. If you have an account, sign in now to post with your account.

Guest
Reply to this topic...

×   Pasted as rich text.   Restore formatting

  Only 75 emoji are allowed.

×   Your link has been automatically embedded.   Display as a link instead

×   Your previous content has been restored.   Clear editor

×   You cannot paste images directly. Upload or insert images from URL.

  • Recently Browsing   1 member


×
×
  • Create New...