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Old 04-24-2008, 01:00 PM
 
Location: DC Area, for now
3,517 posts, read 12,049,244 times
Reputation: 2141

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A fortune of $1 million only yields an income of $50k per year that can last with moderate inflation rates. In today's dollars, $1 mil ain't what it used to be.

Very good points, Forest. Only a handful can be filthy rich and their path will not work for everyone. But there is still something to learn from them.

I just took a retirement course and the financial adviser section said we need a present value of $1 to 1.24 mil in today's dollars to retire on safely and reasonably in a moderately middle class lifestyle. Present value includes the value of the pension as well as net worth.
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Old 04-24-2008, 02:07 PM
 
48,516 posts, read 83,901,398 times
Reputation: 18049
You seem to be doing fine but I wouldn't worry about being a millonaire in your old age at the expense of wasting your youth. You don't have to spend alot of money to have good times and money will not make you happy. Even in rural areas their are people and things to do;but you have to look. As you get older you might find that the things in the city you think of as socal life are really not important.
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Old 04-24-2008, 02:53 PM
 
Location: Forests of Maine
30,677 posts, read 49,430,310 times
Reputation: 19129
Quote:
Originally Posted by Danny_boy View Post
...
Read the book "Rich Dad Poor Dad"
This book is a collection of myths and stereotypes.

Unfortunately not based on reality in the least bit.

Within the book he does not explain that it is fiction, rather the book implies that the stories were real. Only speaking outside of his book does he admit that neither of these two 'dads' exist, and that none of the data is real world.
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Old 04-24-2008, 03:04 PM
 
Location: Marietta, GA
857 posts, read 4,471,918 times
Reputation: 809
Quote:
Originally Posted by Dangerous-Boy View Post
I'm in my mid-20's, the only debt I have is my school loans. I don't pay rent, maxed out the 401k, and started a roth ira at fidelity. What else do I invest my money in? Right now, I make under 40k but that should rise. I spend nothing and have nonexistant social life thanks to living in the suburbs away from friends in the city. I only drive to work. The rest, I walk.
congratulations! You are doing so much better than most people your age.
I think the best thing you can do is to develop good saving habits and spending habits. When i think about buying something i don't ask myself "Can I afford it?" because the answer is probably Yes. I ask " Do I really need it?" and the answer is usually No. Learn to spend your money judiciously.
also, since you already have a relationship with Fidelity check out their Target date Retirement funds and pick one that matches when you want to retire (like Retirement 2035... you may as well retire early since you are doing such a good job with your finances) I set up an automatic payment to go right from my checking into the mutual fund every month, so you are dollar-cost-averaging your investment.
Keep up the good work!
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Old 04-24-2008, 04:21 PM
 
Location: California
1,268 posts, read 866,481 times
Reputation: 76
Quote:
Originally Posted by forest beekeeper View Post
This book is a collection of myths and stereotypes.

Unfortunately not based on reality in the least bit.

Within the book he does not explain that it is fiction, rather the book implies that the stories were real. Only speaking outside of his book does he admit that neither of these two 'dads' exist, and that none of the data is real world.

My dad has made LOTS of money following that mans advice. Not real? yea right!
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Old 04-24-2008, 06:10 PM
 
Location: Forests of Maine
30,677 posts, read 49,430,310 times
Reputation: 19129
It is possible to make a lot of money betting on a lottery too.

Does that make lottery tickets a good investment?

I think not.
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Old 04-25-2008, 01:38 AM
 
Location: Los Angeles, Ca
2,884 posts, read 5,178,709 times
Reputation: 2726
-Stay away from scams, "systems", follow my 3 easy steps to wealth. Or, make money in your underwear. Or anything like that.

Whether its real estate, stocks, anything, most people are behind the curve and catch the tail end of the trend. Remember all the gurus on infomericals in the 90's? Don Lapre? Cash Flow systems? 1-900 numbers?

I don't think people realize how quickly things change. Or on the internet, everyone rushed and built a website. Or search engine optimization.

Real estate a few years. I knew a woman that had to invest. She had to jump on board, this was mid 2004, right near the peak. People don't get rich thinking their going to miss something. You don't get rich by letting the crowd do your thinking for you.

-Most people are too short term oriented, I think its a huge handicap, when it comes to money and retirement.

I know people that have tried to get on gameshows. They tried to be actors/actresses. I knew a few people in the mid 90's, when I was in highschool. They wanted to be actors. One girl had an agent, she was pretty serious about it.

But, if you think about it. The best case scenario is, you'll make $50 or $100 k doing a few commercials or landing a few deals. And after taxes, and your agents cut and whatever other expenses (lost time going on auditions), you might end up with $50 k.

The $50 k will be gone in a few years, then what? Alot of people end up right back where they started. Or trying to go on a gameshow and win $30 k on the Price is Right. After taxes and expenses, you're left with $18 k. That's going to last a year, then you're back to square one.

Not to downplay what people try. Some people certainly make a career out of tv or film. But it's not a "quick hit".

Things are not what they seem to be. People see actors and think they make alot of money. They see singers and see they make alot of money. People see lawyers...that's where the money is! Not everyone obviously, but some people are very simplistic. Actors, singers, lawyers will tell you it isn't that easy.

-I'd read alot, and find 5 star books on Amazon in whatever subject you're interested in. Most people don't read much.

-You don't have to be a genius to do well. You can go far just on spending less than you earn, investing the difference, maxing retirement accounts, keeping your health. Warren Buffett has talked about "liquor and leverage" as two things that have ruined people.

-Beware of the CEO hype in the media. The media is absolutely in love with CEO's and their lifestyle...be the next Martha Stewart. Be the next Donald Trump. Be the next Oprah.

It's a fantasy lifestyle to sell airtime. The CEO world is a completely different life than most people could imagine. Every minute of your day is scheduled. And the sacrifices made, etc. To say nothing of the ethics or morality of it (i.e. CEO's walking away with tens of millions as their companies go bankrupt).

With sports or travel, the media is realistic about the work it takes to be successful. But in business/finance/economies, they sell a fantasy world.
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Old 04-25-2008, 04:51 AM
 
Location: Ohio
2,178 posts, read 8,074,583 times
Reputation: 3910
Marry an older lady with a million dollars and treat her like gold.
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Old 04-25-2008, 06:24 AM
 
Location: Forests of Maine
30,677 posts, read 49,430,310 times
Reputation: 19129
Quote:
Originally Posted by John23 View Post
-Stay away from scams, "systems", follow my 3 easy steps to wealth. Or, make money in your underwear. Or anything like that.

Whether its real estate, stocks, anything, most people are behind the curve and catch the tail end of the trend. Remember all the gurus on infomericals in the 90's? Don Lapre? Cash Flow systems? 1-900 numbers?

I don't think people realize how quickly things change. Or on the internet, everyone rushed and built a website. Or search engine optimization.

Real estate a few years. I knew a woman that had to invest. She had to jump on board, this was mid 2004, right near the peak. People don't get rich thinking their going to miss something. You don't get rich by letting the crowd do your thinking for you.

-Most people are too short term oriented, I think its a huge handicap, when it comes to money and retirement.

I know people that have tried to get on gameshows. They tried to be actors/actresses. I knew a few people in the mid 90's, when I was in highschool. They wanted to be actors. One girl had an agent, she was pretty serious about it.

But, if you think about it. The best case scenario is, you'll make $50 or $100 k doing a few commercials or landing a few deals. And after taxes, and your agents cut and whatever other expenses (lost time going on auditions), you might end up with $50 k.

The $50 k will be gone in a few years, then what? Alot of people end up right back where they started. Or trying to go on a gameshow and win $30 k on the Price is Right. After taxes and expenses, you're left with $18 k. That's going to last a year, then you're back to square one.

Not to downplay what people try. Some people certainly make a career out of tv or film. But it's not a "quick hit".

Things are not what they seem to be. People see actors and think they make alot of money. They see singers and see they make alot of money. People see lawyers...that's where the money is! Not everyone obviously, but some people are very simplistic. Actors, singers, lawyers will tell you it isn't that easy.

-I'd read alot, and find 5 star books on Amazon in whatever subject you're interested in. Most people don't read much.

-You don't have to be a genius to do well. You can go far just on spending less than you earn, investing the difference, maxing retirement accounts, keeping your health. Warren Buffett has talked about "liquor and leverage" as two things that have ruined people.

-Beware of the CEO hype in the media. The media is absolutely in love with CEO's and their lifestyle...be the next Martha Stewart. Be the next Donald Trump. Be the next Oprah.

It's a fantasy lifestyle to sell airtime. The CEO world is a completely different life than most people could imagine. Every minute of your day is scheduled. And the sacrifices made, etc. To say nothing of the ethics or morality of it (i.e. CEO's walking away with tens of millions as their companies go bankrupt).

With sports or travel, the media is realistic about the work it takes to be successful. But in business/finance/economies, they sell a fantasy world.
Good post

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Old 04-27-2008, 09:08 AM
 
26,589 posts, read 52,267,707 times
Reputation: 20410
Quote:
Originally Posted by John23 View Post
-You don't have to be a genius to do well. You can go far just on spending less than you earn, investing the difference, maxing retirement accounts, keeping your health. Warren Buffett has talked about "liquor and leverage" as two things that have ruined people.
The only thing I would add is that I have seen quite a few marriages that ended in divorce and left nothing but a path of destruction behind.

Maybe it's living in California or years of managing residential rentals... but it is sad to see so many people "Starting" over in mid-life or worse... not being able to start over because the fighting never stops.

I don't believe the value of a good marriage can ever be over estimated...
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