RustyNails
Member
Read this comment on chained CPI on reddit, and it needs a re-post:
chernobyl169 said:
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PoliGAF 2013 |OT1| Never mind, Wheeeeeeeeeeeeeeee
- Thread starter ClovingWestbrook
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I know it is a bit off topic, but are there any investment options available to people who make very little money (I guess if I was to start saving money in accounts I would no longer be eligible for SNAP, but that's probably fine if I have decent crops this year)? Investment options that beat the interest on student loans? Or maybe is there a thread where I could learn how to not be so underwater?
CoffeeJanitor
Member
RustyNails
Member
I dunno, it does look like a game of chicken. Watch the PBS Frontline on Obama vs Boehner on tax dealing. Shit's bananas. Keeping that documentary in mind, this makes perfect sense that Obama would do something like this. Not calling it 11th dimensional chess, but Obama has Boehner figured out.
My biggest piece of advice is to start saving a little bit, each month, no matter what. I started investing when I was in college and delivering pizza. My wife and I opened a Roth IRA for each of us and set up automatic $50 contributions each month, so they came out the day after our mid-month paycheck landed.
For specific investment advice there might be another thread for it. But in general I put my money into three buckets based on goals. Short term (planned to spend in the next year or so), medium term (for use in the next several years) and long term (savings for retirement and the kids). What we invest in depends on the goal/bucket. Aside from the company stock purchase plan, I invest only in mutual funds that pay a decent dividend (3%+). But that's me. Others can probably point you to some good resources.
I agree. We've seen this exact "plan" play out repeatedly. The GOP sits there arms folded and says "no". Obama proceeds to negotiate with himself. I'm not yet persuaded this will be any different.
This has been a very educational discussion on the correct way to manage a retirement investment vehicle that one third of Americans can't even afford to have, much less become educated about.
But hey, their fault for living paycheck to paycheck their entire lives. I mean, they had 65 years to figure it out while they were working to eat and have shelter and all.
But hey, their fault for living paycheck to paycheck their entire lives. I mean, they had 65 years to figure it out while they were working to eat and have shelter and all.
RustyNails
Member
50k minimum investment. Dafuq man.
Sorry, I didn't mean to offend you or anything, my assertion is that pretty much everyone makes them, whether they want it or not, this was not directed at you specifically.
And maybe I should clarify what I mean by those assumptions, an assumption is something like "in this group of municipal bonds the variance of default rate over the next 10 years is no bigger than x and has this distribution", I think we all have to make them, usually by accepting some in house assessment based on reputation, and I think when you break it down to the gritty numbers, this is exactly what we keep getting wrong, every single cycle.
Listen, I do very basic modelling, I model my expected expenses in retirement and my expected assets, and I try to find the probability of me running out of money before I dies, I think that's the most basic question that you* need to ask yourself, and to put it harshly, if your financial planner (assuming you have one) can't answer that question, I think he's slacking at his job (they probably don't want to tell it to people because it will freak them out, though in my experience the couple of people I tried to talk with literally didn't know about any of that stuff).
Maybe I'm wrong, maybe I miss something obvious, but looking at my models, you don't need to kick those numbers too harshly (and again, in magnitude that is in no way unprecedented) for that figure to start looking really scary.
But read my edit from my last post, I don't want to sound too doom and gloom.
* I'm not talking about you specifically here.
Whats your interest rate on your student loans? If its like 3.5% and above, the best investment you can make is to pay off your student loan as quick as possible.
Either that, or get a public sector job, have all government student loans, and have them forgiven in 10 years
As for investments, I am a firm believer insanely low cost index funds. I invest in Vanguard:
Total Stock Market 40%
Total International 40%
Total Bond 20%
The goal is to basically follow the market, and slowly become more conservative with age (or if you already have enough money). You sadly needs stocks earning power to get you enough money to retire, but you dont want to get fucked by a bad market when you retire. So be bold when youre young, and get more conservative with age
Why follow the market? Well, because barely anyone can reliably beat the market, so why pay fund managers money to try and fail when you can simply follow the market and pay a shit ton less in fees?
Fees will seriously kill your return over time. Compare a 1% expense ratio to a .1% ratio over a 30 year period. It is pretty insane
If you can't afford the mutual funds minimums, go with etfs. those have no minimums
But yea, PAY OFF YOUR DEBTS. Do that first, then invest. its silly to pay 3-8% (or whatever) in interest and invest in something you will hope beats that. Take the sure investment and pay down the debt
RustyNails
Member
I'm pretty good at saving. One could call me scrooge mcduck. But being a investor noob like you mentioned is really tough. I'd love to understand all of it. If only.
I hope we don't pull a Cyprus anytime soon.
https://personal.vanguard.com/us/funds/vanguard/TargetRetirementList#targetAnchor
Dump all your retirement money into that (or follow the asset allocation in my previous post), and you instantly become a great investor
Grats
Actually, those funds have surprisingly high stock percentages. Seems like they are chasing investors by showing good returns. So yea, screw that, create your own asset allocation with the three funds I mentioned above, and hold your age in bonds
https://personal.vanguard.com/us/funds/vanguard/core
Obama: "The Republican indifference to my concessions proves they aren't taking these negotiations seriously."
GOP: "It's high time that the President start taking the deficit seriously, and this distraction about cuttng social security when we could be saving it is getting us nowhere."
Media: "Why hasn't the President given the GOP at least some of what they want? Both sides refuse to budge."
GOP: "It's high time that the President start taking the deficit seriously, and this distraction about cuttng social security when we could be saving it is getting us nowhere."
Media: "Why hasn't the President given the GOP at least some of what they want? Both sides refuse to budge."
speculawyer
Member
If that is what the media is saying then god help us.
Thanks GhaleonEB and Piecake
I've been out of the legal job market for a while (I didn't have a job while going to college, yes stupid but I wanted to focus on my studies, then I graduated right as the market crashed), and have yet to get a real job since. I'm going to try and get a license and motorcycle so that I can commute to the nearest municipality which is beyond walking distance. My loans are currently deferred for another year so that's good (I was told that if I can't find a job in 30 years they will forgive my debt, silver lining I guess). Most of my loans are unfortunately above 3.5% (more poor timing).
I basically have a useless degree, and when I do once in a blue moon get job interviews they won't hire me because they figure I will move onto a job more suited to my degree (Anth, yeah I know, stupid decision) if I got offered one (who wouldn't?).
I really ended up screwing myself I guess. :lol
Anyway, I should stop shitting up the thread. Thanks again for the advice.
I've been out of the legal job market for a while (I didn't have a job while going to college, yes stupid but I wanted to focus on my studies, then I graduated right as the market crashed), and have yet to get a real job since. I'm going to try and get a license and motorcycle so that I can commute to the nearest municipality which is beyond walking distance. My loans are currently deferred for another year so that's good (I was told that if I can't find a job in 30 years they will forgive my debt, silver lining I guess). Most of my loans are unfortunately above 3.5% (more poor timing).
I basically have a useless degree, and when I do once in a blue moon get job interviews they won't hire me because they figure I will move onto a job more suited to my degree (Anth, yeah I know, stupid decision) if I got offered one (who wouldn't?).
I really ended up screwing myself I guess. :lol
Anyway, I should stop shitting up the thread. Thanks again for the advice.
empty vessel
Member
Why would anybody who has no personal interest in investing want to spend their free time doing any of that? You spent two months of your life doing this? You could have been learning a foreign language or how to play a musical instrument. Or drinking at a bar. Or any number of things that human beings prefer to do with their time. If this were a necessary endeavor, fine. But it doesn't seem to be to me. Other social arrangements make much more sense.
It's fine to be into investing and to want to invest and to enjoy it. Most people don't. (And, incidentally, these people aren't stupid. Most people have very little to nothing to gain from it. Ironically, not even the biggest investors know anything about investing. They pay people to do it for them.)
Some of you may have already seen this video, but it's worth posting again:
http://www.youtube.com/watch?v=d4o13isDdfY
Make sure to pay particular attention to the government hearing with Google, Amazon and Starbucks.
Some of the shit mentioned was just absolutely absurd. Apple pays 1.9% in taxes? For 14 years of business, Starbucks paid $1.6 million in corporate taxes? Are you fucking kidding me? It's crazy how that Double Irish with a Dutch sandwich loophole is even allowed to exist. Seriously, how the hell is this shit legal?
http://www.youtube.com/watch?v=d4o13isDdfY
Make sure to pay particular attention to the government hearing with Google, Amazon and Starbucks.
Some of the shit mentioned was just absolutely absurd. Apple pays 1.9% in taxes? For 14 years of business, Starbucks paid $1.6 million in corporate taxes? Are you fucking kidding me? It's crazy how that Double Irish with a Dutch sandwich loophole is even allowed to exist. Seriously, how the hell is this shit legal?
"Both sides refuse to budge." is just the current mantra from idiots like Chris Matthews. It remains to be seen if this will chage but I'm not hopeful.
Link
The Autumn Wind
Agreed. Everyone that isn't a Fox News loyalist already knows the GOP is all about obstructionism at this point. Why is Obama "offering" a confession that does nothing but piss off his own base? And as unlikely as it is, god forbid if Boehner calls his bluff.
The Senate will never let it through.
Link
The Autumn Wind
I know, but that doesn't help Obama's case one bit.
Rocket Scientist
Member
Makes him look 'serious' about a solution, but not really.
It's fucked up. They pay themselves royalty fees but the only reason they do is so that they can funnel that money to tax havens. Since they are the owners of both the licence/trademark and the individual establishments, the concept of paying royalty fees is ridiculous. Crazy fucked up. Dutch government is getting a report on the economic effects of all of this in a few months. Interested in seeing what the numbers are going to be. Unless they hide it like they have many times with other reports here.
It's enough to make David Brooks happy, I'm sure.
For like 10 minutes, anyway. Until Boehner rejects the offer, at which point Brooks then whines about Obama being stubborn again.
Aaron Strife
Banned
He'll only be happy when Obama unilaterally caves to whatever Boehner's current concession is.
Until ten minutes later when Boehner moves the goalposts again. Consider that Boehner's last offer to Obama in the grand bargain deal was 1.2 trillion in revenue. Obama got 600 billion from the tax cuts and somehow now that's enough.
TacticalFox88
Banned
Ghaleon, you ever give financial advice to service members? I'm still relatively young compared to most of this thread, so it'd be nice to have an...."adult" perspective.
The Librarian
Banned
Oi! I started posting in PoliGAF when I was sixteen.
Trickle down consumption.
ClassyPenguin
Banned
Well, this has certainly been uh, something.
I still believe that 401's are for supplemental income together with SS. We should first or means guarantee a comfortable life for seniors which can only come from federal benefits. And yes, we should really have investment, savings and other economic matters as part of the school curriculum. I still think everyone should take part and learn as much as possible but I know not everyone has that desire or even the time to do so, especially as one accepts the responsibilities of work and family. It's easy to say that it's simple to learn how to invest properly but come on, it's unrealistic to have that take over the guarantee of federal benefits/
I still believe that 401's are for supplemental income together with SS. We should first or means guarantee a comfortable life for seniors which can only come from federal benefits. And yes, we should really have investment, savings and other economic matters as part of the school curriculum. I still think everyone should take part and learn as much as possible but I know not everyone has that desire or even the time to do so, especially as one accepts the responsibilities of work and family. It's easy to say that it's simple to learn how to invest properly but come on, it's unrealistic to have that take over the guarantee of federal benefits/
I'd prefer a better, simpler system. You and I agree on the problems with our country. You've even swung me to the MMT side of things.
Not sure why you latched onto that post. I don't think you had the full context. I'm doing what I can given the reality of the world. Nothing more.
ClovingWestbrook
Banned
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I think there are countless things we can teach our kids at school that are more beneficial to society as a whole than investing.
Also, the biggest barrier against being a successful individual investor is not lack of education, I mean it's a barrier no doubt, but one that you can overcome quite easily (those things are not complicated, just boring and obfuscated, 99% of it is high school math, and the other 1% is mostly math majors scaring people with MBA into paying them ridiculous amount of money because calculus*), the biggest problem is bias against individual investors, and I'm not even talking about the technical issues du jour like high frequency trading or transaction reordering, those are things we can fix with proper regulation, I'm talking about the fact that when you invest, you're forced to play a bunch of zero sum games against actors with significantly more information than you. Yeah, when the market is booming everyone makes money, but when the bad times roll, well, I don't think there is anything they can teach you at school that can prevent you from getting fucked.
Or to put it succinctly, they have research departments, you don't, who do you think is going to get fucked when shit hit the fan?
And again, I've researched this crap a lot (way too much actually), and I'm someone who made quite a bit of money the last crash cycle, but I'm also honest enough to admit that the good decisions I've made were done on very incomplete information, I was guessing and I got lucky (or more accurately, I panicked and it payed off).
We should not be sending our citizens to Wall Street to be eaten alive by the banks, even economically, it just moves money from productive people to the financial industry, which is an overhead on the economy, generally, a required overhead, but it's getting out of hand -
*slight hyperbole, but only slight.
empty vessel
Member
Oh, I know that. My post probably came off more hostile than it was meant to! I just feel strongly that we ought to spend as much of our lives doing stuff that is personally rewarding and meaningful as possible. I'm sure you don't disagree with that at all.
PhoenixDark
Banned
If republicans were smart they'd let this pass and then run a fresh crop of house challenger candidates against the democrats who voted to cut social security.
ClovingWestbrook
Banned
If they were smart but I'm not sure if they are.
Aaron Strife
Banned
The GOP young guns are more likely to be tea partiers, who would argue the social security cuts don't go far enough. It'd be disingenuous if nothing else.
Also for Republicans to let it pass that'd require some of their own rank to pass it as well... it would cut both ways.
Have Republicans in deep red districts vote for it, moderates against. Democrats in moderate districts would be in super danger. I take the point on the tea partiers though. I think Republicans are oddly capable of having it both ways.
Aaron Strife
Banned
What if the winning coalition were made up of deep red Republicans and deep blue Democrats?
It would also be the deep red Republicans would be the ones in danger of primary challenges. Signing off on Obama's budget would sink them. As for the moderates, consider that almost every GOPer voted yes on the Ryan budget, the few that didn't voted against it from the right. The accusations that Democrats want to take your medicare or whatever might not resonate as well from the party that wants to privatize it completely.
NYCmetsfan
Banned
The mortgage interest deduction is indeed terrible. In addition to wealthier families benefiting from it far more than middle class and poor families, it's also a subsidy for homeowners in general at the expense of renters (who are, on average, poorer than homeowners). I don't know why anybody other than the wealthy would defend that thing.
Rocket Scientist
Member
While it's crazy how much money is going to people who are in the top percentiles, it's pretty insane that so many homeowners have such low incomes. I guess a lot of those are people who lost jobs, but paying a mortgage and making less than 10, 20 or 30 thousand dollars must be hell.
ClassyPenguin
Banned
That's not surprising. Many people buy into the whole homeownership spiel when they don't need to.
The whole "you don't need to buy a house" kinda breaks down in retirement.
Where are people who can't afford buying a house will find the income to pay rent when they don't work?
And that's before getting into the issue of what the fuck do you do when your landlord evict you when you're 85.
And just so we're clear, I think there are many problems with the current model of home ownership, but telling people 'just rent all your life' merely replace it with another set of problems, which I'm not even sure are smaller on a personal level.
ClovingWestbrook
Banned
Apparently Rick Perry wants to run again in 2016. Lol.
Certainly puts a spin on the term 'voting with your dollars'.
I'm okay with this.
I don't disagree, and that's why I'm investing aggressively and put a lot of time into it. Because, given the fucked up system we have, it's the only way I'm going to enjoy a window of decent retirement in which I can do more meaningful and rewarding things. I wish it were not so.
tanooki141
Member
Thanks for posting this.
It was super interesting to watch, I almost felt bad for the guys in the hearing.
And then there were four.
It's crazy how quickly the dominoes have fallen regarding democratic support for marriage equality in the senate.
It's crazy how quickly the dominoes have fallen regarding democratic support for marriage equality in the senate.
ClovingWestbrook
Banned
Would you mind recommending some books on getting started in investing? Last October my family sold a piece of property that I owned a piece of and I got back a nice piece of change. It's been sitting in my bank aince which isn't really smart if I'm trying to parlay it into something more. But I don't really know the first thing about investing and am hesitant to move before I get a good enough understanding in what is the best path to take.
I'd have to have read some first.
A while back some good sites with resources were posted, with some advice I've followed since. Let me see what I can dig up.
Edit: this is the one. http://www.bogleheads.org/wiki/Main_Page
Use the links on the front page - getting started, investing, etc. Some great stuff in there.
Take some time to watch these videos:
http://www.bogleheads.org/wiki/Video:Bogleheads®_investment_philosophy
Aaron Strife
Banned
Don't feel bad for them. They are a big part of the problem and should be stripped of whatever licenses or certifications they may have. What they are doing is highly unethical, far worse than breaking a confidentiality clause or whatever it is keeping them tight-lipped.
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