Welcome to City-Data.com Forum!
U.S. CitiesCity-Data Forum Index
Go Back   City-Data Forum > General Forums > Retirement
 [Register]
Please register to participate in our discussions with 2 million other members - it's free and quick! Some forums can only be seen by registered members. After you create your account, you'll be able to customize options and access all our 15,000 new posts/day with fewer ads.
View detailed profile (Advanced) or search
site with Google Custom Search

Search Forums  (Advanced)
 
Old 10-27-2012, 05:46 AM
 
Location: SW MO
23,593 posts, read 37,361,284 times
Reputation: 29336

Advertisements

I think this is getting funny. So many theories. So many opinions. So much back-and-fourth. In my limited experience it's all a crapshoot. Some do well, others don't and still more manage to live on what they have without agonizing over every penny they might be missing out on. Count me among the latter. We know what our incomes are. We know what our costs are. We know where we can cut back if the need arises and we really don't give a whole lot of thought to it or spend a lot of time on it. For us that's a very comfortable way to live. Quite frankly, I would be totally bored spending any major portion of my day crunching numbers while trying to decide the what if's, if-comes and probabilities. Life in retirement, for us, is far more casual and relaxed without the drama and agonizing over the almighty dollar. But y'all enjoy!
Reply With Quote Quick reply to this message

 
Old 10-27-2012, 06:08 AM
 
14,346 posts, read 14,161,665 times
Reputation: 45629
Quote:
Let me save you tons of time on research, fancy theories, and any money that you might be spending on any newsletters or books.

The only reason you have made a dime, at the expense of savers and every working person, since the housing crash (or during tech bubble) on the stock or bond market on any other asset is because the Federal Reserve (and other central banks) is printing trillions of dollars in fiat money. Nothing else has mattered. When they stop (as they will have to eventually) your assets will tumble hard. Every professional on Wall Street knows this. That is why they wait with baited breadth over any hints about what the Federal Reserve is up to (insiders of course know way ahead of time). Everything else you written about is totally irrelevant. The markets will tank whenever the printing presses stop. And economies can start growing again once it moves beyond being simply a casino.

Any claim you may have on knowing how to make money on the market resembles a gambler claiming some fancy mathematical algorithm for making money on the slots. It is just plain silly.
Until the last couple of years, I might have agreed that investing money is over-hyped. However, the last couple of years have been good for equities and we've made up a lot of ground. I'd had been despairing for our 401K account until than. However, our return for the last 24 months--on equities--has exceeded 20% a year.

Personally, I think the rate of return on income funds and bonds ought to be low. Low risk equals low rate of return. I gather bonds don't have coupons you clip off anymore. However, the notion of sitting around and clipping off those coupons every month for a living never set well with me. The rate on these investments (particularly state and municipal bonds) has to be low because the rate on US Government bonds is particularly low and the risk for state and local securities shouldn't be much higher.

Its interesting to view what many of the elderly write within their bubble here in the Retirement Forum. Your focus, understandably, is upon developing and expanding a retirement nest egg and doing so with a minimum of risk. Understand though, that for your rates of return to rise that interest rates generally would have to rise. Every increase in interest rates makes it that much harder for someone to purchase a home and for a small business (and I consider myself that) to borrow money short term to meet payroll and other obligations. The Fed acts to keep interests rates low and prints money--as you point out ad nauseam--to maintain a climate in a tough economy where businesses can afford to borrow and people can continue to buy homes. You (the elderly living on investments) are just one piece of a complex economy. Of course your rates have gone down. Everyone in this economy is hurting. Have you figured that out yet? Have you ever thought about what a contracting money supply and increasing interest rates would have on the budget and paying interest on the budget deficit? It would greatly increase the percentage of the budget necessary to pay the interest on the national debt. It would complicate challenging problems of paying for defense, medicare, medicaid, and other essential programs.

The real crime or at least problem in this economy is not what is happening to YOU. Its what's happening to people who actually work for a living. They see wage stagnation (if they are lucky), layoffs, downsizing, extended hours, and reduced benefits.

So, get out of your bubble and take a look around. For once contemplate the harm it would do everyone else to have policies in place that would give you a higher income from your investments. Also, you might consider the equities market. Although, it may be starting to cool down.
Reply With Quote Quick reply to this message
 
Old 10-27-2012, 07:40 AM
 
Location: Chicago
5,559 posts, read 4,607,245 times
Reputation: 2202
Quote:
Originally Posted by mathjak107 View Post
enough already! we all know the problems.

the issue is we have to assume your retirement is failing following the path you are and thats why your complaining so much over and over , so how are YOU going to deal with it other then complaining on forums?
You asked the question. I reckon your question has been answered to your satisfaction.

Last edited by richrf; 10-27-2012 at 07:55 AM..
Reply With Quote Quick reply to this message
 
Old 10-27-2012, 08:09 AM
 
Location: Chicago
5,559 posts, read 4,607,245 times
Reputation: 2202
Quote:
Originally Posted by markg91359 View Post
The real crime or at least problem in this economy is not what is happening to YOU. Its what's happening to people who actually work for a living. They see wage stagnation (if they are lucky), layoffs, downsizing, extended hours, and reduced benefits.

So, get out of your bubble and take a look around. For once contemplate the harm it would do everyone else to have policies in place that would give you a higher income from your investments. Also, you might consider the equities market. Although, it may be starting to cool down.
Family income has been going down as costs have been going higher. Only the top 1% has benefited from current policies. What's more the Federal Reserve policies have not only harmed the American family it has also harmed economies around the world (by exporting inflation). Far from being in a bubble, those who have condemned the current loose money policies have very much a world view as well as a future view (the excerpt from John Mauldin's newsletter I posted above).

Let me suggest to you that those who brag about some short term marketing gains which have come at the cost of hundreds of millions of people worldwide (do you read about worldwide unemployment and poverty) are those who are living in a bubble. This bubble will also bust, and the few that have may partially benefited (maybe the stock market gains partially offset the lost of income and the price hikes) will have lost that too. It happened after the tech bubble and after the housing bubble. This (as Sheila Bair is warning) is the bond and equity bubble that is about to burst).

The simple fact is that one cannot grow any economy by printing money. In all of history, printing money has led to disastrous consequences. More and more people are ending up in poverty (the percentage of retirees at or near poverty has gone up significantly). Given current policies, the trend will probably accelerate. This is a retirement forum. Do you care? I sure do.
Reply With Quote Quick reply to this message
 
Old 10-27-2012, 08:25 AM
 
14,249 posts, read 17,870,733 times
Reputation: 13807
Quote:
Originally Posted by mathjak107 View Post
enough already! we all know the problems.

the issue is we have to assume your retirement is failing following the path you are and thats why your complaining so much over and over , so how are YOU going to deal with it other then complaining on forums?
Exactly. Rates are what they are. So what strategy do we use to deal with the issue? To your credit, you have outlined a strategy. Some may disagree with it but, at least, it exists. My strategy is broadly similar to yours although, benefiting from our manager, we do have access to some investments that many do not. Also, we have enough cash that we are also able to widen our diversification in a way that many cannot.

As I said early on in this discussion, we retired two years ago at age 55. Right now we can live on our pensions but we need our money to last at least 30 years, maybe more. In the present climate, CDs simply do not cut-it so you need to do something else.
Reply With Quote Quick reply to this message
 
Old 10-27-2012, 09:02 AM
 
106,056 posts, read 108,015,953 times
Reputation: 79628
i was pretty much done replying as its a moot point trying to explain any of this to those who have not even a basic understainding yet argue it anyway .

well think of it this way.

researchers found if you want to use the inflation adjusted 4% as your model and a 60/40 mix as your portfolio that inorder to run out of money if markets and bonds were bad you would need to fall below 1 % real return for 15 years .

well the long term average real return for t-bills is about 1 to 1.5% thats after inflation . the average real return for the s&p 500 is 8% long term after inflation .

stocks and bonds can do pretty damn crappy and still stand a chance of hitting 1% real return over 15 years and even if they didnt you still have another 15 years to do it. before running out of money.. .

ask your self how much slack t-bills have before they fail? the answere is pretty much none and thats why those counting on living off just interest rates on cd's are getting a haircut in income they can draw with no hope for recovery.

while these studies and calculators are just guides to work your own plan around which model has the greatest chance of failure by a huge margin?

Last edited by mathjak107; 10-27-2012 at 09:26 AM..
Reply With Quote Quick reply to this message
 
Old 10-27-2012, 09:53 AM
 
31,672 posts, read 40,937,970 times
Reputation: 14419
Perhaps all of us involved in this discussion on the best way to invest in this low interest rate environment should take a moment to pause and be thankful that we have the resources to be worried about investing and not have to worry if we have enough money to feed ourselves and family and to worry what a storm might do to our financial survival. Millions do and are wondering if this storm could push them into a deeper hole.
Reply With Quote Quick reply to this message
 
Old 10-27-2012, 09:55 AM
 
Location: Chicago
5,559 posts, read 4,607,245 times
Reputation: 2202
Quote:
Originally Posted by TuborgP View Post
Perhaps all of us involved in this discussion on the best way to invest in this low interest rate environment should take a moment to pause and be thankful that we have the resources to be worried about investing and not have to worry if we have enough money to feed ourselves and family and to worry what a storm might do to our financial survival. Millions do and are wondering if this storm could push them into a deeper hole.
A thought that I will share with you this weekend. Thank you.
Reply With Quote Quick reply to this message
 
Old 10-27-2012, 10:00 AM
 
31,672 posts, read 40,937,970 times
Reputation: 14419
Quote:
Originally Posted by richrf View Post
A thought that I will share with you this weekend. Thank you.
You know Rich, I was just moving some money around just in case services in the NE and Mid Atlantic states are knocked out. Said let me assume pension checks don't get deposited and automatic payments still occur etc etc. I thought about folks I know who probably don't have that luxury and the millions more who aren't in as good a shape as they are and it is scary.
Reply With Quote Quick reply to this message
 
Old 10-27-2012, 10:05 AM
 
Location: Chicago
5,559 posts, read 4,607,245 times
Reputation: 2202
Quote:
Originally Posted by TuborgP View Post
You know Rich, I was just moving some money around just in case services in the NE and Mid Atlantic states are knocked out. Said let me assume pension checks don't get deposited and automatic payments still occur etc etc. I thought about folks I know who probably don't have that luxury and the millions more who aren't in as good a shape as they are and it is scary.
I so much agree. I am wishing the best for all those you speak about.
Reply With Quote Quick reply to this message
Please register to post and access all features of our very popular forum. It is free and quick. Over $68,000 in prizes has already been given out to active posters on our forum. Additional giveaways are planned.

Detailed information about all U.S. cities, counties, and zip codes on our site: City-data.com.


Reply
Please update this thread with any new information or opinions. This open thread is still read by thousands of people, so we encourage all additional points of view.

Quick Reply
Message:


Over $104,000 in prizes was already given out to active posters on our forum and additional giveaways are planned!

Go Back   City-Data Forum > General Forums > Retirement
Similar Threads

All times are GMT -6.

© 2005-2024, Advameg, Inc. · Please obey Forum Rules · Terms of Use and Privacy Policy · Bug Bounty

City-Data.com - Contact Us - Archive 1, 2, 3, 4, 5, 6, 7, 8, 9, 10, 11, 12, 13, 14, 15, 16, 17, 18, 19, 20, 21, 22, 23, 24, 25, 26, 27, 28, 29, 30, 31, 32, 33, 34, 35, 36, 37 - Top