Chef Jim Posted October 8, 2008 Share Posted October 8, 2008 I was also wondering if people can allocate their money into different funds themselves... Are people offered a place to put their money into a safe, no risk fund? Working for the gov't, I know that is one thing I can do... Pull it all out of the risk areas and plop it into a no risk fund. The great thing now, is everything can be done online and daily... Not like the past where there was huge waiting periods. That's not necessarily a good thing. Many times it's a bad thing. Pick a diversified portfolio, dollar cost average as much as you can (at least the match if one) and rebalance annually. Saving long term is a marathon not a sprint. Link to comment Share on other sites More sharing options...
BillsFanNC Posted October 8, 2008 Share Posted October 8, 2008 Which is why the absolute best advice you can give someone entering the workforce is to put at least the minimum to get full company match in their 401k, and everytime they get a raise they should put part of that into their 401k as well until it is maxed out. If you never see the money in your pocket and never get used to spending it, it is a lot easier to keep yourself living w/in your means, and setting yourself up to actually be able to afford to retire in 40 years. This is great advice and is something I have adhered to for some time now. I work for a Fortune 500 company with over 25k employees worldwide. There was a retirement seminar at our site last year where we were told almost 25% of US employees do not participate in the 401k plan at all!! WTF??? I was shocked that people would be that stupid to throw away free money by not at least contributing to the company match. Link to comment Share on other sites More sharing options...
ExiledInIllinois Posted October 8, 2008 Author Share Posted October 8, 2008 That's not necessarily a good thing. Many times it's a bad thing. Pick a diversified portfolio, dollar cost average as much as you can (at least the match if one) and rebalance annually. Saving long term is a marathon not a sprint. Thanks. Like I posted before... Stocks have outpaced gov't securities in the last ten years by under 1%. Now with all this happening, I have a gut feeling that what you say may not be the truth... I think times are changing, more people retiring, etc.. etc.. I fear people are in for a rude awakening. We heard how real estate ALMOST always gains... That got blown out the window. I just don't believe what they are saying... I don't want to play the game that is such a con, for what 3% over the long haul. I would rather stay steady at 4-5%. IMO Link to comment Share on other sites More sharing options...
meazza Posted October 8, 2008 Share Posted October 8, 2008 I had to walk up hill BOTH WAYS to school in the pouring rain and whipping snow! And yes... I sort of agree with you. Again, should I spend or save. What happens like meazza said when we stop spending? You know what? The sad and disturbing thing is that the economy actually needs people to be out of control. And: No not for businesses. That would reduce the risk that many people take to start a business and succeed. Maybe there could be a failed business court. The verdicts are: Nice try you worked hard and dumbass, you're going to jail I figured you would say that. I like the idea about a failed business court though. I also corrected it to: The verdicts are: Nice try you worked hard, got sick you dumbass, you're going to jail. We don't necessarily have to be out of control to keep consumption at a normal level. It's just that the second people make a bit of money, it's already gone on a fancy new car or god knows what. I'll give you an example. I post on an analystforum for people doing their MBA or CFA as well as other finance degrees. There was one guy who posted about a year ago. He said, "Last year, I was making 280 K as an Ibanker but I lost my job due to being involved with one of the big banks (hint Bear) and now I have no money left because I have no job. What do I do?" How does someone who makes 280 K which is about 5 times my salary go from that much to zero so quickly? How does one not save at all? You don't have to put away 280 K but FFS, put that 100K aside a year and you'll be pretty fine for a rainy day. Link to comment Share on other sites More sharing options...
Chef Jim Posted October 8, 2008 Share Posted October 8, 2008 Thanks. Like I posted before... Stocks have outpaced gov't securities in the last ten years by under 1%. Now with all this happening, I have a gut feeling that what you say may not be the truth... I think times are changing, more people retiring, etc.. etc.. I fear people are in for a rude awakening. We heard how real estate ALMOST always gains... That got blown out the window. I just don't believe what they are saying... I don't want to play the game that is such a con, for what 3% over the long haul. I would rather stay steady at 4-5%. IMO The only people that were saying that were people in real estate. Stocks have outpaced gov't securities by only 1% the last ten years? Where are you getting that information? Link to comment Share on other sites More sharing options...
ExiledInIllinois Posted October 8, 2008 Author Share Posted October 8, 2008 The only people that were saying that were people in real estate. Stocks have outpaced gov't securities by only 1% the last ten years? Where are you getting that information? Correction... I am sorry... The fund in my retirement that is linked to the Dow Industrial. Link to comment Share on other sites More sharing options...
SD Jarhead Posted October 8, 2008 Share Posted October 8, 2008 My wife and I made a decision long ago, before we got married, that we were not going to have kids. It makes a huge difference these days with how much is being spent on kids. When I was a kid (in the dark ages) we made due with a bike, a bat, ball and glove (and lots of times we just shared), a tin can and a sled in the winter. And those things were all good for several years and handed down. I'm not sure how it is in other parts of the country but here in Orange county people just need to have all the toys and the need to keep up with the Joneses. I had a case just yesterday of a couple with a combined income of over $160k. They had a modest mortgage of around $1500 but they had all the toys. An RV, four wheelers, dirt bikes, brand new truck etc, etc. On that income they had only $3k in the bank and my rep had to squeeze them to save $200 per month. They were ok with retirement but if they lost their jobs they had three weeks of fixed expenses put aside and no life insurance. They had no idea where their money was going and kept saying "we don't have to do anything right?". I understand the paycheck to paycheck thing for some people. But for most it's a spending issue. They're just out of control. I cry Bullschit. A $1500 mortgage in the OC? Do they live in a studio? But seriously, I see that all around me here in SoCal. except most don't have that income and pulled funds for the toys out of the 2nd on their house. Fuggin idiots! I am blessed to have the toys mentioned above and two kids to boot. I am also fortunate to have a wife who does well working, but those little monkeys of mine sure are money drains. I pay $1200 a month just to put them in a Christian school. I told my wife that this may not be forever and we may have to consider putting them in public if things get bad. She doesn't want to hear it though. Women- can't live with 'em, can't shoot 'em! Link to comment Share on other sites More sharing options...
Chef Jim Posted October 8, 2008 Share Posted October 8, 2008 I cry Bullschit. A $1500 mortgage in the OC? Do they live in a studio? But seriously, I see that all around me here in SoCal. except most don't have that income and pulled funds for the toys out of the 2nd on their house. Fuggin idiots! I am blessed to have the toys mentioned above and two kids to boot. I am also fortunate to have a wife who does well working, but those little monkeys of mine sure are money drains. I pay $1200 a month just to put them in a Christian school. I told my wife that this may not be forever and we may have to consider putting them in public if things get bad. She doesn't want to hear it though. Women- can't live with 'em, can't shoot 'em! No they actually live in a SFR in Huntington Beach. Not everyone bought the $800,000 home here. Link to comment Share on other sites More sharing options...
TPS Posted October 8, 2008 Share Posted October 8, 2008 The rate cuts are for companies to spend on production, you know so they can hire employees, increase consumption etc. If everybody drastically starts saving, the market will crash even more, which will cause stock values to go down which will cause more panic. Jesus Christ open a book. Sorry, I disagree on that. The rate cuts are a signal to the markets that the world's policymakers realize this is serious, and they intend to do whatever's necessary. Link to comment Share on other sites More sharing options...
SD Jarhead Posted October 8, 2008 Share Posted October 8, 2008 No they actually live in a SFR in Huntington Beach. Not everyone bought the $800,000 home here. Well then they've done at least one thing right. They are probably in the minority or at least purchased before things went nuts. Link to comment Share on other sites More sharing options...
meazza Posted October 8, 2008 Share Posted October 8, 2008 Sorry, I disagree on that. The rate cuts are a signal to the markets that the world's policymakers realize this is serious, and they intend to do whatever's necessary. I agree that it is a message but the bottom line is people don't shut the door completely on spending and companies stop profitable projects because they can't borrow any money. Link to comment Share on other sites More sharing options...
Chef Jim Posted October 8, 2008 Share Posted October 8, 2008 Well then they've done at least one thing right. They are probably in the minority or at least purchased before things went nuts. No they're not totally messed up. As I mentioned they are doing ok with retirement but their monthly budgeting is whacked. My rep said they told her that some months they get their pay check and just tack them up on the refrigerator until they need money. By the way I'm part of that minority too. Link to comment Share on other sites More sharing options...
ExiledInIllinois Posted October 8, 2008 Author Share Posted October 8, 2008 With this whole housing mess... What part of people getting inheritence had on shooting for the stars with expensive houses? Is that really a factor? Link to comment Share on other sites More sharing options...
Chef Jim Posted October 8, 2008 Share Posted October 8, 2008 With this whole housing mess... What part of people getting inheritence had on shooting for the stars with expensive houses? Is that really a factor? Why did we just have a lot more people die the past couple of years than usual? Link to comment Share on other sites More sharing options...
ExiledInIllinois Posted October 8, 2008 Author Share Posted October 8, 2008 Why did we just have a lot more people die the past couple of years than usual? No. But, older parents are dieing and leaving more and more to their children than they ever have. No? I know our ex-neighbors a few years ago inherited a bunch of money and ploped it down on a 350k house when they were living in a 150k house. Now more power to them... But, I wonder what kind of factor that plays on things. Link to comment Share on other sites More sharing options...
SD Jarhead Posted October 8, 2008 Share Posted October 8, 2008 No they're not totally messed up. As I mentioned they are doing ok with retirement but their monthly budgeting is whacked. My rep said they told her that some months they get their pay check and just tack them up on the refrigerator until they need money. By the way I'm part of that minority too. In this case the minority wins! BTW, who still gets checks? Link to comment Share on other sites More sharing options...
Chef Jim Posted October 8, 2008 Share Posted October 8, 2008 In this case the minority wins! BTW, who still gets checks? The people who still write them in front of me at the grocery store. Link to comment Share on other sites More sharing options...
bills_fan Posted October 8, 2008 Share Posted October 8, 2008 We don't necessarily have to be out of control to keep consumption at a normal level. It's just that the second people make a bit of money, it's already gone on a fancy new car or god knows what. I'll give you an example. I post on an analystforum for people doing their MBA or CFA as well as other finance degrees. There was one guy who posted about a year ago. He said, "Last year, I was making 280 K as an Ibanker but I lost my job due to being involved with one of the big banks (hint Bear) and now I have no money left because I have no job. What do I do?" How does someone who makes 280 K which is about 5 times my salary go from that much to zero so quickly? How does one not save at all? You don't have to put away 280 K but FFS, put that 100K aside a year and you'll be pretty fine for a rainy day. Simple. If he made 280k, my guess is his base salary was about 100k, with 180k in bonus. 100k base is not much to live on in NYC, think 50k in Buffalo, it really is comparable. That bonus splits out to, my guess, 130k-150k in cash and 30k - 50k in restricted stock options (Bear was notorious for giving these out). The restricted stock options he got last year would have been virtually worthless. Bonuses are taxed at 43% in NYC, you see 57%. He would have seen about 75k on the bonus. Now, the question is...did he make any big ticket purchases (NYC apt, engagement ring etc.)? Not defending him, but just saying...it could happen quickly. Link to comment Share on other sites More sharing options...
SD Jarhead Posted October 8, 2008 Share Posted October 8, 2008 The people who still write them in front of me at the grocery store. Dude, is it hot today or what? This is one of those rare occasions that I wish I had AC in my house. Damn! Link to comment Share on other sites More sharing options...
IDBillzFan Posted October 8, 2008 Share Posted October 8, 2008 Dude, is it hot today or what? This is one of those rare occasions that I wish I had AC in my house. Damn! It'll cool off quite a bit this weekend...but then again, the Santa Anas are coming this weekend, too. Link to comment Share on other sites More sharing options...
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