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[Smiles and Cries]

about $6k selling my art... spent most of 2004 broke

 

[onion_pixy]

How much money did you lay out in the beginning, out of curiosity? For the record I'm totally debt free -- although I don't have much credit to my name as I don't even own a credit card.

I bought a crappy house in bad condition (had renters in it) for 260k SoCal housing prices make babyJesus cry :lol Tho its on a big lot and zoned for multi units (i.e. I could put an apartment building on the lot if I wanted too) I shelled out 14k between down payment and fees. That was with two mortgages initially. Within a year, the value went up enought to refi and buy out 2nd mortgage

Hopefully interest rates will stay low for awhile

 

[Incognito]

i'm interested in learning why it's more important to own a house than say, an apartment. right now, my parents fork over a grand+ a month for my apartment, and in san antonio, housing prices are extremely cheap. the thing is, with apartment's and their managment, they offer basically everything as part as the rent fee.

such as fixing anything and everything whenever at no cost, free washer/dryer, etc. what's the advantage in owning a house, then? especially for a college student. this topic came up quite a lot with my parents when my last apartment least was running down, and as i've described above, the pro's of an apartment at this poitn outweigh the pro's for any house thus the choice of new apartment over house.

 

[bionic77]

i'm interested in learning why it's more important to own a house than say, an apartment. right now, my parents fork over a grand+ a month for my apartment, and in san antonio, housing prices are extremely cheap. the thing is, with apartment's and their managment, they offer basically everything as part as the rent fee.

such as fixing anything and everything whenever at no cost, free washer/dryer, etc. what's the advantage in owning a house, then? especially for a college student. this topic came up quite a lot with my parents when my last apartment least was running down, and as i've described above, the pro's of an apartment at this poitn outweigh the pro's for any house thus the choice of new apartment over house.

Because when you rent the money you pay for rent is like throwing it down the toilet.

When you buy, that money goes towards the equity of the house and at the very least if you sell it back at what you bought it for you come out almost even (like living there for free). With the market the way it is today you would more then likely make a profit after living there.

 

[suikodan]

I made the same salary as the average income discussed here and bought a house with my gf.

Here is a little story about throwing money down the drain. The first apartment I got with my gf was a 4 1/2 for 700$ CDN. The electricity, taxes and other crap except phone and cable were included and it also included a dishwasher so it wasn't very bad.

But my gf started playing with the calculator and came to me one day saying: "We're gonna pay 84000$ for nothing in 10 years! That half a house".

So we bought a house. Ok, there's more to pay other than the mortgage like electricity, city taxes and all the rest but I never felt so good in all my life. I'm a guy who likes to receive friend over and the apartment was so "crappy" that my comfort gauge was in the red (The Sims players know what I'm talking about ). So with the house, I can finally invite people over, throw LAN parties and lawn parties and it's even too big for my gf and I so family expansion is definitely in the plans!

And if it goes bad, you can always sell it! There are people that prefer to live in an apartment and that's completely understandable but as a man who returned in his hometown after living three years in the city, it fells so good! *sheds a tear :lol

 

[ChumsGum]

Build a credit history. Bad credit is actually worse then having no credit. With excellent credit history and you can actually buy a home for zero money down. Personally, I put down 10% on my first home.

 

[ChumsGum]

Once that home is yours, pay the mortgage on time, watch that equity grow, and use it as a tax shelter too. With rent, you get nothing; no equity, no tax shelter.

 

[Agent Icebeezy]

Build a credit history. Bad credit is actually worse then having no credit. With excellent credit history and you can actually buy a home for zero money down. Personally, I put down 10% on my first home.

I did 20%

 

[Jesiatha]

Because when you rent the money you pay for rent is like throwing it down the toilet.

When you buy, that money goes towards the equity of the house and at the very least if you sell it back at what you bought it for you come out almost even (like living there for free). With the market the way it is today you would more then likely make a profit after living there.

Well, when you buy a good chunk of the payment goes to interest. We're paying more in interest on our house than we paid in rent, even after the tax deduction. The other problem is that we're probably in a housing bubble now - theoretically home prices could depreciate (and likely will if interest rates go way up).

If you want a similar quality of living, you're probably better off paying less in rent, and using the money saved on your payment to invest and build up equity in something other than a home.

What I would really recommend is getting a cheap "fixer-upper" house where your mortgage payment is similar to what rent would be. Then you build equity, and can also build "sweat equity" by improving the house.

 

[bionic77]

Well, when you buy a good chunk of the payment goes to interest. We're paying more in interest on our house than we paid in rent, even after the tax deduction. The other problem is that we're probably in a housing bubble now - theoretically home prices could depreciate (and likely will if interest rates go way up).

If you want a similar quality of living, you're probably better off paying less in rent, and using the money saved on your payment to invest and build up equity in something other than a home.

What I would really recommend is getting a cheap "fixer-upper" house where your mortgage payment is similar to what rent would be. Then you build equity, and can also build "sweat equity" by improving the house.

I thought interest rates for home mortgages were really low these days> It is true that interest can make renting seem more attractive, but even with a high interest rate I would always buy because at the end of the day you come away with something, whereas with renting you get nothing.

 

[fart]

i'm interested in learning why it's more important to own a house than say, an apartment. right now, my parents fork over a grand+ a month for my apartment, and in san antonio, housing prices are extremely cheap. the thing is, with apartment's and their managment, they offer basically everything as part as the rent fee.

such as fixing anything and everything whenever at no cost, free washer/dryer, etc. what's the advantage in owning a house, then? especially for a college student. this topic came up quite a lot with my parents when my last apartment least was running down, and as i've described above, the pro's of an apartment at this poitn outweigh the pro's for any house thus the choice of new apartment over house.

where else are you going to bury your bodies? backyard, hellloo

 

[pnjtony]

I think I hit about $31,000...total houshold was about $49,000. After my girlfriend (sugar-mamma) finishes her Masters program that oughta raise a bit, heh.

Not bad for being homeless 3 years ago!

 

[Jesiatha]

I thought interest rates for home mortgages were really low these days> It is true that interest can make renting seem more attractive, but even with a high interest rate I would always buy because at the end of the day you come away with something, whereas with renting you get nothing.

Interest rates are low, but at the start of a loan, you'll still pay most of it in interest.

My point - if you rent, you don't necessarily end up with nothing. If your rent is less than your mortgage payment would be, you have extra money. With that money you can build equity in stocks/bonds/whatever instead of in a home. Consult your financial advisor to decide which is better

Scenario A: Take out a mortgage for $X, pay $Y each month for 30 years. End up with the value of the house (which is $X + appreciation)

Scenario B: Rent for $Z per month (where $Z is less than $Y). Invest the savings ($Y - $Z) in stocks. 30 years later you end up with some large chunk of equity in the stock. Sell that and buy a house


Of course, most people are very bad at investing the money - it's so much easier to spend it!

 

[ChumsGum]

Interest rates are low, but at the start of a loan, you'll still pay most of it in interest.

My point - if you rent, you don't necessarily end up with nothing. If your rent is less than your mortgage payment would be, you have extra money. With that money you can build equity in stocks/bonds/whatever instead of in a home. Consult your financial advisor to decide which is better

Scenario A: Take out a mortgage for $X, pay $Y each month for 30 years. End up with the value of the house (which is $X + appreciation)

Scenario B: Rent for $Z per month (where $Z is less than $Y). Invest the savings ($Y - $Z) in stocks. 30 years later you end up with some large chunk of equity in the stock. Sell that and buy a house


Of course, most people are very bad at investing the money - it's so much easier to spend it!

This is the worst advice that I've ever heard.

Let's say you go into a 30 year fixed and your mortgage is $1000 a month. Barring you didn't refi or pull out any equity, you mortgage payment on that 30th year is still $1000.

Now let's say that you are paying rent of $700 a month. Sure you can save $300 a month, but what about next year, the year after that, and what about in 30 years? Your rent, my friend, will be astronomical, in the thousands, not the hundreds. Where will be your savings now? If you think your rent will be high then, what do you think home prices will be?

 

[Jesiatha]

This is the worst advice that I've ever heard.

Let's say you go into a 30 year fixed and your mortgage is $1000 a month. Barring you didn't refi or pull out any equity, you mortgage payment on that 30th year is still $1000.

Now let's say that you are paying rent of $700 a month. Sure you can save $300 a month, but what about next year, the year after that, and what about in 30 years? Your rent, my friend, will be astronomical, in the thousands, not the hundreds. Where will be your savings now? If you think your rent will be high then, what do you think home prices will be?

Well, the difference between our mortgage payment and prior rent payment is well over $300. Assume a $1000 mortgage. If you pay $1000 in rent, you're definitely better buying. If you pay $1 in rent, you're definitely better renting (edit - even under the assumption that rent rates will appreciate). It would be an interesting exercise to see where the break even point is if you assume that the return on the invested savings is the same as the appreciation rate of the home.

I don't really recommend that people rent instead of buy - instead that they buy cheap instead of taking out the biggest loan possible. Plus, I do really worry about home prices depreciating when interest rates go up.

 

[iapetus]

Buying's a real pain in the arse in the UK at the moment. House prices are through the roof, to the extent that someone like me (actually earning more than the vast majority of people who've posted their salary here) can't afford to buy in the area where I'm working. I'm hoping to move to renting somewhere smaller and closer to work this year, which will cripple my social life, but hopefully give me more money and incentive to buy. But with house prices possibly due for a fall (or possibly not) it might not be the best time to buy.

 

[Boogie]

Dammit, I don't understand any of this financial talk. Talk of this sort always gets me depressed that I'll be screwed financially because I don't understand any of this stuff.


My future:

 

[Wellington]

I am considering buying a house, but I don't think I'd have enough for a down payment anytime soon.

I'm just curious, Chumsgums, how much (percentage-wise) do you put into savings each month (or per check)?

Maybe it's cause I am young, or maybe it's cause I am paying a large portion of my parent's mortgage, but I am having a hell of a time saving up much of anything.

 

[Ghost]

Buying's a real pain in the arse in the UK at the moment. House prices are through the roof, to the extent that someone like me (actually earning more than the vast majority of people who've posted their salary here) can't afford to buy in the area where I'm working. I'm hoping to move to renting somewhere smaller and closer to work this year, which will cripple my social life, but hopefully give me more money and incentive to buy. But with house prices possibly due for a fall (or possibly not) it might not be the best time to buy.

It's only a matter of time before the prices tumble, i do feel sorry for anyone trying to by a house in the UK atm...I guess you are a first time buyer so you'd need a hell of a down payment?





Anyway i worked 3 months in my shitty part time beer money job and earned £2500, which in your measly american currency is exactly $17 billion

 

[Loki]

What's the matter with how John Edwards made a living??

Hah, I knew as soon as I posted it that you'd chime in. If you'd really like to know, go do some reading-- I'm not here to do it for you. Preferably not from sites like "WeIsDemocrats.com".

 

[snaildog]

Since this thread is as good as any: Out of interest, what direction is best to go in for an intelligent person to make the biggest crapload of money with little risk? I'm confident that I could do any degree and adapt to most jobs well, and while I'm not that much of a selfish money-hungry person, I do have a certain dream house in mind (forest, trapezes, movie theatre, etc). I'm a couple of years into a Software Engineering degree because I love programming, but I probably won't want to do it forever (would probably want to retire / do something more social).

 

[Agent Icebeezy]

Since this thread is as good as any: Out of interest, what direction is best to go in for an intelligent person to make the biggest crapload of money with little risk?.

You'd have to be a fuckin idiot to fail in real estate

 

[Tommie Hu$tle]

It isn't and wasn't intended that way, but since some people felt insulted - better to apologize to them and move on.

Still surprised by the salaries I've been reading. Some of the posts I've read from some of these posters suggests they have a great understanding of various issues and deserve to be in a better paying (and managerial) position than their salary suggests.

Phoenix how many times must I tell you. Don't ruffle the plebeians feathers they get so willful tis shame really. However as it has been already posted. There is money in land get yourself a rental property or two and you can sit back and live the good life. There is a guy I know who's sister is like 21 or 22 she took about 8k and invested it in real estate in her teens and now she owns her own mortgage comapny. Never went to college or anything and makes my salary look like chump change.

 

[mrklaw]

I was lucky. I bought a flat in the UK just at the right time. From that I managed to buy a house with a big deposit (only way, as even with above average salary, prices were out of my reach). So now I have a 3-bed house with about a 60% mortgage. So I should be OK even if prices tumble.

I don't understand the maths about rent+invest. With all the buy-to-let investement over here, most rental costs are more than the mortgage cost. You are actually paying more than if you bought a property.

 

[pestul]

Bought a house in May with my fiancee.. before we could even afford a car (fees/gas and shit plus the city is small anyway). Best decision ever so far. We've already made a lot of modifications on the house despite our combined salary of ~$40k/yr. The house was only $79k cdn too.. God bless Newfoundland. We got a 5yr fixed mortgage which locked us in to about $414/month before property taxes. Previously, I was paying over $300/m for a shitty one bedroom appt.

 

[DarienA]

Here in Montgomery County, MD it's a sellers market... the house my missus bought a good... what 5-7 years ago where we now live has EASILY over doubled in value. It's like that all over this area.... homes here just go for ridiculous amts.... we figure we'll live here for a few more years.... and if this area starts to grow up too much, either sell or rent and move a bit further south... based on other factors. Homes in this area easily run the 320,000 to 500,000. We are closer to the low side of that range with our 4 bedroom, 3 1/2 bed home. The value is only going to go up as this area is rapidly growing.

 

[Incognito]

Hah, I knew as soon as I posted it that you'd chime in. If you'd really like to know, go do some reading-- I'm not here to do it for you. Preferably not from sites like "WeIsDemocrats.com".

I've read quite enough about Edwards to know that he's a legitimate attorney who values justice and holding corporations accountable for their mistakes over making a quick buck at the expense of a client. He's also the senator who has proposed the "3 strike" rule concerning junk lawsuits and the lawyers who have a habit of bringing them to trial. Unfortunately, such legislation wasn't passed.

Also, not to turn this into a tort-reform argument, but junk lawsuits accout for <1percent of skyrocketing insurance costs.

 

[ChumsGum]

I'm just curious, Chumsgums, how much (percentage-wise) do you put into savings each month (or per check)?

Pre-ownership, I was putting almost 33% of what I made into saving. Post-ownership, between 10-20%. The only advice I can give about saving is to have a portion of your check direct deposited into some kind of savings account. I'd suggest something like a money market account, so that you can withdrawl the money, if you have to, without penalty yet it still earns more than a standard savings account. As I already mentioned though, there are so many financing options out there that you don't even need a down payment sometimes. Work on getting your credit score in the mid 700s and then see a mortgage broker to see about what kind of loan you can get. You'll be surprised how many options you have with excellent credit.

Personally though, I'd gamble that savings in the stock market, but that's just me. Stocks offer a much higher risk but also a much higher reward. I threw some extra money I had into Sirius Sattelite Radio in November; bought the stock at about $4.00 then sold at $7.00. That's a rate of 75% in a matter of 2 months, that's amazing.

 

[lordmrw]

I made about 18 or 19k last year. Up until about October, I wasn't in school and working two jobs, which would normally mean I would have alot of money saved. But one thing after another has taken all my money. First the 1000 I owed my local community college, then the 3500 dollar student loan, then various other bills, and then the biggest ass kicker, I now have to pay my tuition monthly ($761). Only good news is that I'll be done on September 23, 2005, a date I have circled on my calendar. Failing isn't even in my mind, as graphic design is something i excel at. Only thing that could possibly hold me back is my fucking tuition.

 

[Maxwell House]

Investing in stocks can be a more lucrative invesment vehicle than rental properties. There is also much less headache (no upkeep, no dealing with tenants, etc.).

There are many sector, small cap, mutual funds that have averaged over 20% return on investment over the past 5 years. Go to Kilpinger's website, go to their mutual fund finder..and do a search based on:

Kiplinger's Mutual Fund Finder

Fund Universe: US Stocks
Fund Style: All
Return of 20%+ over the past 5 years
S&P Star Ranking of 5 stars
Turnover 80% or less (to keep taxes down)
Volatility Rank of ModHi

Sort them by best return over the past 5 years. Those are the funds I would invest in. I'd diversify my money among 3-4 different funds that invest in different types of markets (gold, small cap, financial companies, etc).

A portfolio consisting of some of the best funds will IMO usually give you a better rate of return than real estate will, with less headache. My dad has some condo properties which aren't doing very well. He has been trying to offload two for them for about a year with no luck. I personally have my money invested in two funds and the rest in shorter term securities whose investment and selection I handle myself. I have been very pleased with my ROR the past few years.

I'd recommend leaving as little cash in hand as you can. Don't keep most of your money in saving accounts or checking accounts. Those don't give you any sort of real return on your money, and usually barely even keep up with inflation. I would suggest keeping maybe $1000-$1500 max in your checking account, syphoning off the rest when it accrues into your fund or stock portfolio of choice. Try to be as fully invested as possible in something at all times.

Also, if you decide to try to play the stock market yourself, I would recommend using the power of margin accounts. You basically are given double the real capitol you have to invest in stocks, with good rates given for the amount of money you borrow. It really can help you get much higher rates of return on your money.

I definitely agree that buying a house is MUCH better than renting an apt. Renting really is just throwing your money out the window. You don't own any of it. You aren't building up credit. You aren't building up equity to use against future loans. You don't get any tax sheltering. It really is a lose-lose thing. I would only rent a place out if you simply don't have the credit or money to purchase a place yet.

 

[pollo]

Gaming Age:

Now issuing tips on fiscal mobility, debt management, investment expenditures all under 0% APR financing!

 

[Loki]

I've read quite enough about Edwards to know that he's a legitimate attorney who values justice and holding corporations accountable for their mistakes over making a quick buck at the expense of a client. He's also the senator who has proposed the "3 strike" rule concerning junk lawsuits and the lawyers who have a habit of bringing them to trial. Unfortunately, such legislation wasn't passed.

Also, not to turn this into a tort-reform argument, but junk lawsuits accout for <1percent of skyrocketing insurance costs.

Well if that's all you know, then you obviously haven't done enough reading, particularly from non-"Democratic party line" sources.

Also, you specifically asked what was wrong about "how he made his living", and I responded to that-- not about any of the initiatives he sponsored during the presidential campaign; still, even those lack teeth if you examine them. The devil is in the details, Lonestar...

Point of fact: Edwards prosecuted his last case against physicians involving CP in either '94 or '95 (I forget), yet the medical establishment knew that the sometimes-employed live birth techniques at the time (use of forceps etc.) had no bearing on the incidence of CP (i.e., it was not statistically significant above and beyond the "normal" incidence of CP); studies and findings were published to that effect in such reputable and authoritative publications as the New England Journal of Medicine and The Lancet as early as 1987. Do the math.


Also, the "< 1% of costs" figure is for judgments paid, and doesn't take into account defensive medical practices, which even the most conservative estimates place at around $40 billion per year, and $100 billion on the high end-- more than enough to provide insurance to most of the uninsured. But whatever-- who cares, right?


But this is OT, so I'll desist.

 

[Phoenix]

This is the worst advice that I've ever heard.

Let's say you go into a 30 year fixed and your mortgage is $1000 a month. Barring you didn't refi or pull out any equity, you mortgage payment on that 30th year is still $1000.

Now let's say that you are paying rent of $700 a month. Sure you can save $300 a month, but what about next year, the year after that, and what about in 30 years? Your rent, my friend, will be astronomical, in the thousands, not the hundreds. Where will be your savings now? If you think your rent will be high then, what do you think home prices will be?

More importantly the tax savings from owning property and just upkeeping it makes it much more valuable than renting. Even if you went interest only (which is in essence renting as you get no equity in the property) and wrote off all the interest on your tax return - you'll come out better than renting. Renting is almost always a bad proposition compared to purchasing.

 

[Incognito]

I know about the case you're referring to, and yes, in hindsight, it seems like a case he titled into his favor. I also remember specifically reading that his findings concerning that specific were correct for the time only to be discounted many years later.

Also, the "3 strike" rule wasn't just some campaign initivate to quell voters mind after they had been been scared shitless of attorneys via Bush's incoherent stance on the real problems effecting medical costs and instead focusing on a lesser problem that directly attacked his competition: Kerry and Edwards.

Edwards proposed that legislation long before he was considered a VP candidate and, IIRC, the legislation was shot down by Bush himself after being sent through congress. I'll try and search for it, but I'm on <56k in the hosptial and the connection is constantly dropping, so it might take awhile...

 

[Phoenix]

Investing in stocks can be a more lucrative invesment vehicle than rental properties. There is also much less headache (no upkeep, no dealing with tenants, etc.).

It can be but you have to be VERY mindful of watching your investments as they can turn in the course of a week. In addition, investing in mutual funds assumes that you have no intent to touch that money until retirement age unless you want to pay the INSANELY massive penalties that come with fund grabs. In terms of headache there really isn't a whole lot if you bring in a property management company. You're writing 100% of it off at the end of every year, so unless you just don't have the cash on hand its not a big deal to run rental property. I have a set of them: a single and half a 4 plex I share with my dad. Mine are managed by a property management company. My dad likes the hands on work of screwing around with them (which I don't understand). At the end of the year we are both writing off whatever we spend to maintain the property. While he may be 'saving' more than I am in the long run, it just wasn't worth the aggravation to me.

I will absolutely agree about keeping the 'cash on hand' small. Keeping a lot of cash around doesn't make any sense. You're just about doing as well putting your money in a sock as keeping your money sitting in the bank. But if you do - ING Direct is by far the best savings/checking account I've seen yet.

 

[Loki]

Lonestar: No offense, but don't bother. One, because I've already read about everything you've mentioned (as well as the opposition's side, which is something I feel you haven't done), and two, because this really isn't the place for it. I'm sure this topic will come up again, however (in fact, I plan on making a substantial post on the litigation system in this country and resurrecting an old topic about it within the next week), and then you can feel free to own me with your righteous logic.


I don't want to derail this topic any further-- it's not good form.

 

[Incognito]

Lonestar: No offense, but don't bother. One, because I've already read about everything you've mentioned (as well as the opposition's side, which is something I feel you haven't done), and two, because this really isn't the place for it. I'm sure this topic will come up again, however (in fact, I plan on making a substantial post on the litigation system in this country and resurrecting an old topic about it within the next week), and then you can feel free to own me with your righteous logic.


I don't want to derail this topic any further-- it's not good form.

yeah, i meant to add something like your post above to my last post. anyway, i've read both sides, adn we can discuss that when the proper thread shows its head.

EDWARDS 08!!!! :lol

 

[DCharlie]

"Buying's a real pain in the arse in the UK at the moment. House prices are through the roof, to the extent that someone like me (actually earning more than the vast majority of people who've posted their salary here) can't afford to buy in the area where I'm working."

i never understood this, when i lived in London about 4 years ago, i was making enough to get by, but now...

holy shit, it's more expensive than friggin' Tokyo. Yet all my friends that i used to work with have been on the same pay for the last 3-4 years....

How are people surviving?! I'd struggle on my Japanese wage if i had to live in London now.
Plus the service is still as shit as usual and nothing works (trains in particular)

 

[Future Trunks]

Made last year? Less than I hoped. I just started working back in August. :lol I'd say approx. 16K+ over the past 4 months.

I'm actually looking to get a Townhome/Condo (something I can own) myself this summer. I'd go for a house, but I don't have the time to maintenance and up keep a house. I'm sure the townhouse will be stretching my limits already. I plan on going through a realtor and renting it out when I'm done with it and making money off of that.

I'm also getting into investing, cause from what I've predicted and read, putting your money in the bank isn't helping much. I plan on investing $10000 a year (at the moment) with 70% going into diversified common stocks (hoping to get to owning 20-40 different stocks across 12 different sectors one day), 25% into short term federal bonds through my 401K or IRA (for tax protection purposes), and 5% into a money market savings - as a just-in-case fixed income asset.

This investing thing is tricky (as I'm learning).

 

[Truelize]

$0

:lol:lol:lol

 

[Maxwell House]

In addition, investing in mutual funds assumes that you have no intent to touch that money until retirement age unless you want to pay the INSANELY massive penalties that come with fund grabs.

There isn't any additional penalty for selling shares of a mutual fund before retirement age unless you bought the fund with pre tax dollars. Selling funds for a gain gets taxed at normal capital gains rates.

 

[WHOAguitarninja]

Abut $70k.


It should be noted that when discussing salaries like this, I like converting to pesos in order to feel significantly not poor. But hey I'm just starting college so I'm not too worried yet =).

 

[Bravoexo]

If I minus what I spent w/ my income.... I get a (-$300+) ...

 

[Phoenix]

There isn't any additional penalty for selling shares of a mutual fund before retirement age unless you bought the fund with pre tax dollars. Selling funds for a gain gets taxed at normal capital gains rates.

And it gets counted as tax-year income and taxed accordingly.

 

[Maxwell House]

And it gets counted as tax-year income and taxed accordingly.

Yes, as does any sort of capital gains. You made it sound like mutual funds were taxed at some higher rate than stocks, bonds, etc do. They are taxed exactly the same way, not anymore so. There is absolutely no reason to hold a mutual fund until retirement age unless you are invested in the fund via some sort of tax shelter.

And profit from a fund, stock, etc only gets counted as income and taxed at income levels when held for less than a year.

If you hold a mutual fund for over a year, when you sell you are only taxed 20% on the profit.

 

[duderon]

Abut $70k.


It should be noted that when discussing salaries like this, I like converting to pesos in order to feel significantly not poor. But hey I'm just starting college so I'm not too worried yet =).

ahhhhhh, yeah.

*dies*

 

[Phoenix]

Yes, as does any sort of capital gains. You made it sound like mutual funds were taxed at some higher rate than stocks, bonds, etc do. They are taxed exactly the same way, not anymore so.

No or else I would have stated that they were taxed at a higher rate.

In addition, investing in mutual funds assumes that you have no intent to touch that money until retirement age unless you want to pay the INSANELY massive penalties that come with fund grabs.

There are insanely massive penalties that come from selling off mutual funds because you will get an early withdrawal penalty along with everything else which is not something you incur if you sell of stocks.

 

[onion_pixy]

If you hold a mutual fund for over a year, when you sell you are only taxed 20% on the profit.

only 20% thats a hell of a lot. That means your investments need to make quite a return on investment to SEE any profit whatsoever.

Income from sales of a house are much less restrictive. If under 250k, you can usually avoid paying ANY income tax on the money.

Not that investing in funds is a BAD thing, just throwing reality into the picture. Especially when the market is so bad. People always need a place to live tho

 

[Myllz]

Somewhere in the neighborhood of $25k.

 

[Maxwell House]

It is a 20% tax on aggregate gain, meaning that it isn't per gain, but over the whole year, what your total gain or loss was over the portfoilio. I don't think that is that harsh of a penalty. It certainly isn't harsh enough to be labeled "insanely massive". If 20% was too harsh of a hit, no one would invest in the stock market.

In addition, investing in mutual funds assumes that you have no intent to touch that money until retirement age unless you want to pay the INSANELY massive penalties that come with fund grabs.

The way you worded it, it sounded like you thought that selling mutual funds was subject to the same penalties that withdrawing early from a 401K would entail.