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Lease or Buy? Big difference - many of those people driving those "new" Bimmer and Rovers are renting from the bank with no intention of owning either because they don't have the money to buy it outright or like to breathe in those VOC's every 3 years.
Financially if you look at the depreciation on new luxury cars, for people who want VOCs every four years or so it can make much sense to lease, especially if you're not going over 10-12K a years, and the warranty is about as long as the lease. Like all new cars, a luxury car plunges in value as soon as they drive off the dealer's lot. Three or four years down the line - they're worth even less. Run the math - sometimes a lease is ok, depdneing on the residual and the money factor, and you don't have to try to hit any target value on selling the car because you simply turn it back in. The math isn't really favorable for cheaper cars however.
OK. They may want to re-evaluate the value of their net worth once they try to sell their homes. That's how a lot of American and LI HHs got screwed.
For those who sold at the price they really wanted, kudos to them! =)
Again i dont see the point. As i stated they own the house out right plus they dont live in million dollar homes. Maybe at the peak of the bubble 600 to 800k but in todays market 400 to 500k.
Maybe this thinking isnt suitable for most people here but you can live a nice life for 100k and still save and retire well. However back to the point labeling poor middle or upper class is a waste and is only good for people who's self esteem is tied to their bank accounts or toys
Honestly yes some of them are but not all. The ones who work private sector saved, didnt foolish spend their money and had investments.
They wanted to have 20% for a house. Normal car not a 50k one. Didnt buy things to keep up with the Jones
Yeah, they saved $5million on a civil servant salary (or private sector but remember you said $100k salary). You are talking about a tiny few way out of the ordinary examples. YOU mentioned $100k salaried people in their 50's with $5 million (that's FIVE MILLION, with a 5 and a MILLION) net worth. That's some remarkable investing, I must say. Are their names Buffet?! Did they sock away 60% of each paycheck in a 401k (as if that were legal). They should write a book on how they raised $5 million NW on $100k/yr. Jim Cramer and Suze Ormon would jump on it.
And my friend, you are the FIRST one to EVER accuse me of suffering from "LI Mentality" so for that I say thanks. I have finally arrived!
You hear that, suckers! I have LI Mentality! I guess that means I'm leaving the keys on the counter and moving to Brooklyn!
It is possible and honestly not difficult if you have the mindset for it. The comment about the 401k shows it. There are another retirement investments methods besides a 401k. The 5 million is on the high side and the lower 2 million which is still reasonable. 100k a year with 9% going to 401k with an avg 7% return which is what it usually averages out to over 25 to 30 years yields 1.3 to 2.3 million end result.
It's not entirely impossible mongoose. Given a certain set of assumptions, $1M to $3M is attainable at $100K. $5M is hard to imagine. Some possibilities:
- Did not pay for kids' college educ. A late relative of mine had his sons take ROTC to get college funding. This should take care of the bulk of it.
- Lived in relatively low-tax neighborhoods where taxes were $10K or less.
- Happened to have stockholdings when the markets were expanding in the 80s and late 90s.
- Bailed out before 9-11.
- Kept heater off during the winter.
In the future, getting 7% avg return will be tough to do with a balanced fund. Opportunities for growth with well-diversified corporations are rare and bond yields will be meager for another decade.
It is possible and honestly not difficult if you have the mindset for it. The comment about the 401k shows it. There are another retirement investments methods besides a 401k. The 5 million is on the high side and the lower 2 million which is still reasonable. 100k a year with 9% going to 401k with an avg 7% return which is what it usually averages out to over 25 to 30 years yields 1.3 to 2.3 million end result.
I won't bother entertaining your fantasy while you backpedal from it Starwind. I'll grant you the $2.3million in a better than average investment environment and forget about the double digit jumps in taxes and inflation (plus at $100k/yr, 9% in 401k, I wonder where the $ come from for those "another retirement investments methods". So you're still 2 and a half million short. If you want to exaggerate to make a point, fine, but don't get in a lather when you get called out on it. Some of us aren't "reading with a LI mentality." We're just doing basic math. Just like you just did and came up with half. It takes more than a mindset. It takes revenue, guts and luck and even with all three of those, saving over $2 million on LI on $100k per year salary is a pretty amazing feat. Doable, but no where near the norm.
It is possible and honestly not difficult if you have the mindset for it. The comment about the 401k shows it. There are another retirement investments methods besides a 401k. The 5 million is on the high side and the lower 2 million which is still reasonable. 100k a year with 9% going to 401k with an avg 7% return which is what it usually averages out to over 25 to 30 years yields 1.3 to 2.3 million end result.
Are you assuming $100k over the 25-30 year period?
Guess what? $100k in 1984 on LI put you well into the UMC!
The $100k salary today is probably a $40k salary 30 years ago.
There is zero probablility of saving $2mil on a $100k salary on LI.
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